Credit Scores

[railfancwb]

I now get my credit score routinely, whether I want it or not, as a byproduct of a financial application.

Unless I get a bee in my bonnet to buy a vehicle on credit or refinance my house the score is not currently relevant to me.

But it is interesting to watch. It will bounce up a few points, then bounce down a few points. Seems to hover in a narrow range. Those bounces seem unrelated to any thing I’m actually doing with money.

Curious…

[janice6]

My last vehicle purchase said it was 840.  I don't monitor it,  I just pay my bills. 

[crockett]

1 hour ago, railfancwb said:

I now get my credit score routinely, whether I want it or not, as a byproduct of a financial application.

Unless I get a bee in my bonnet to buy a vehicle on credit or refinance my house the score is not currently relevant to me.

But it is interesting to watch. It will bounce up a few points, then bounce down a few points. Seems to hover in a narrow range. Those bounces seem unrelated to any thing I’m actually doing with money.

Curious…

 

It's most likely your regular credit card usage. The credit scores update weekly in many cases. When one of your credit card accounts reports back with a couple grand of balance on a certain day and the bill wasn't posted or due yet, it will lower your available credit at that point of reporting, and the credit bureaus consider any usage of credit as a potential sign of finical distress, even if you pay off your credit cards in full every month, and in time.

Using just a bit over 10% of your credit line lowers your credit score. Its called credit card utilization and makes up 20% of your vantage score.

I monitor my score and my history once a month, for a long time now, just to make sure I'm not a victim to any fraud or banks reporting bullshit. Currently at 814 points. Never missed a payment, never been late. Only way to improve my score is by adding even more accounts and letting them age. I have no need for more accounts, credit line on personal credit cards is 6 figures, I can get up to 100k cash on the same day from my credit union bank and I get the best interest rates if I needed anything.

Using credit or loans only makes sense in 3 cases:

1. Using a good 2% cash back credit card, and only if you pay it off in full, every month, in time.

2. When you have the same amount in liquid assets, invested in anything that has a higher ROI than the interest you are paying on your loans. Aka passive income.

3. When the interest rate on your loan is lower than the inflation rate. Aka free money.

If none of those 3 cases match your circumstances, you are throwing your money at the elite.