Find the best credit score faq. Get your answers to many frequently asked credit and credit repair questions.
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Our goal is to help you find answers to the most frequently asked questions on credit scores.
If I have too many unused credit cards. Why is it not a good idea to close these accounts, when I don’t have any balances in them?
Don't do it during the loan process. In fact, you shouldn't take any action that would have an adverse affect on your credit score once your loan package is sent to the lender for review.
Especially don't close cards that have balances remaining. This raises a red flag to the scoring system. It makes it appear that you many be in financial trouble. If you want to close some accounts after the loan process is completed, only close the newer credit card accounts. You'll keep the good points for credit history from the older cards.
Perhaps your score is above 680+. Having too many credit cards really doesn't affect you that much. When you have a high score, you've already proven that you're responsible with managing your credit. That’s why too many credit cards really doesn’t hurt you.
Maybe you are just establishing credit (under two years). Then it's a good idea to have two to three credit cards and make all payments on time. This way you will have several trade lines on your credit report and will boost your credit history.
Why did they change the bankruptcy law?
Credit card companies are the reason for the new law and they pushed hard for its passage. In this way they lock most consumers into their debt by forcing a payment plan instead of erasing it.
Of course, people would and should pay for their purchases. But, in the past, sometimes when it became hard to do this you could declare bankruptcy to eliminate these debts. Now this has changed.
Because of the new law, it is of great importance that you completely understand there is no escape from your obligations. So you must avoid the circumstance of getting there in the first place.
When does the 14-day window for unlimited credit inquiries start?
You can have unlimited inquiries within a 14-day period, whether these inquiries are for a mortgage loan or auto loan. The 14-day time frame starts when the first credit report is pulled. Any subsequent inquiries within 14 days will still only count as one hard inquiry.
What happens if I don't have a credit score?
Credit scoring cannot be generated if you haven't applied for credit at some time. Since there is not enough credit information to give you a score, lenders will hesitate loaning you money. Try applying for a small loan or obtain a credit card to start a credit history on yourself.
Does the 14-day window close once the loan funds?
The 14-day window ends on the 14th day, regardless of what day the loan funded.
Does shopping for the best interest rate hurt my score?
This is a very good question. The agencies keep track of every credit application initiated by you. So if you have too many applications in a short period of time, they can affect your score.However, they are getting better at recognizing when you are shopping for the best rates. Especially when shopping for a mortgage or an automobile. In such cases, shopping around may have little or no impact on your score
Do pre-approved offers get considered as new credit and affect my credit score?
No, begin pre-approved doesn't mean you actually have the loan. These type of inquiries are just checking to see if you have good credit. So they have not effect on your scores. Credit card companies do these type of inquiries to know who to send applications to. Thus such inquiries don't have an effect on your scores.
Does co-signing for a loan affect my credit score?
Yes. Remember, when you sign you are agreeing to pay if the other person does not. So the debt is looked at as yours. Thus it will appear on your credit report.
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