Credit Myth #3 - Close Some Lines Of Credit

Q:If I close some of my credit card accounts, I will have a better credit score.

A: Credit experts generally agree that once you have opened accounts
you should keep them open. The reason is that as soon as you close them
then you are shutting down the continuation of building credit history.

Closing them will never help your score, and it might actually hurt your
score by lowering you overall utilization rate and shortening the average
age of your active accounts, which is one of the reasons why some not
knowing this have had a declining credit score.

Keep them open and pay your cable bill with it once a month. Then pay it in full every month to avoid interest charges. Or you can keep a small balance on it for a month or 2 then pay it off in full. The fact is that the credit bureaus do not know when you have paid off your credit card in full every month or not. They simply are more interested on your payment patterns regarding the reporting of late payments starting at 30 days since there is no grace period after this time frame.

Many people avoid purchasing a home due to credit repair issues.  This week I am going to display some great blogs written by my friend Robert Montoya who has personally helped many of my clients repair their credit issues so they can purchase a home.  If you need help, contact Robert, 818-298-6894.