Student Loan Debt vs. Credit Card Debt. Which Impacts Credit Scores More? - Episode #64
Today’s question has to do with student loan debts and we are going to look at student loan debt versus credit card debt and how those impact your credit score., So, what do you think the answer is? Student loan debt impacts your score less than credit card debt and that’s because installment debt hurts less than revolving debt and student loans are an example of installment debt and credit cards are example of revolving debt. You want to make sure that if you’re going to apply some accelerated payments, that you do so against your credit cards first you want to wipe your credit cards clean in terms of the the amounts owed and then go after student loans. One more thing to remind you of, while there are differences between these types of debts when it comes your credit score, in terms of your debt to income ratio which is a common ratio lenders use to make a decision about you, there isn’t a difference here. They basically add up all your debt, your credit card debt plus your student loan debt and make a decision on what your ratio is so that’s an important thing for you remember.
Manage Your FICO Credit Score for a Refinance - Episode #52
This episode discusses:
1. Why most of us may need to refinance
2. How to handle your credit score in the short time you have before you refinance
3. Tips for getting your score higher such as keeping your credit card utilization low and paying off your cards 2x per month or even more!
Many of us are needing to refinance as we enter the unraveling of our 5-year interest only adjustable rate mortgages. But we all know that times have changed and we need to be realistic to the fact that times have changed. Many of us are living in houses that are worth less than we paid for them, and that the credit markets have tightened up, and that now all the pieces matter — your income, your FICO credit scores, your loan/value.
This video addresses the credit score piece. While a 680 might have been enough to get approval without income back in 2005, it’s not enough now. You will need a 760 or above to get the best rates possible.
I’ve increased my FICO score by 30 points in the past 7 months, well really most of this was in the past 4 months. How did I do this? Not through debating inaccuracies. Not through any shady practices. I’ve increased my FICO credit score through watching my balances and paying on time - scratch that - paying ahead of time. By paying my bills two times per month or even every week, I’ve lowered my credit utilization ratio and that has increased my FICO credit score.