Posted 4 years, 8 months ago

Just as there are certain actions that you SHOULD take to improve your FICO score (see previous article “Credit DOs”), there are certain actions that you should avoid in order to improve your FICO score.

To keep your credit rating as high as possible, DON'T do the following: 

  • Don’t do anything without talking to us first.  We’ve listed just a few actions to avoid, but it’s always best to contact us before you do anything that could have an impact on your credit rating.  We assist homeowners every day and can help you avoid doing anything that might jeopardize your ability to qualify for a home loan.
  • Don't apply for several credit cards in a short period of time.  Looking for new credit can indicate higher risk and lower your credit score (most often the FICO Score).  However, if you're applying for a mortgage, or an auto loan and multiple lenders ask for your score over a short period of time, it shouldn't be affected.  These are seen as a single inquiry.
  • Don't move your debt around.  The best way to improve your credit score is to pay down your revolving credit instead of moving it around.  Actually, owing the same amount on fewer accounts may lower your score.
  • Don't close unused credit cards to raise your score.  Closing an account doesn't make it go away.  It still appears on your credit report and may be considered in the credit score.
  • Don't open several new credit cards you don't need, to increase your available credit.  This can backfire and wind up lowering your credit score.
  • Don't quickly open lots of new accounts if you're starting out.  New accounts lower your average account age, which isn't good.  Rapidly adding accounts also looks risky for new credit users. 
  • Don't open new credit card accounts just to have a better mix.  It won't raise your credit score and may even lower it.  Only open new accounts as you need them.
  • Don't think closing an account makes it go away.  Closed accounts still show up on your credit report and may be factored into your score. 

Please don’t hesitate to contact us with any questions or if you would like us to review your personal credit report.  We can often times help improve your credit score which will assist you in qualifying for a home loan and help you obtain a lower interest rate.

-The Kavanewsky Team