Home Depot Card Kills Credit Score
Now, I have a pretty good credit score and I utilize my credit to own properties in some cases.
I was out with a buddy of mine who "knows this credit score guy". He told me that those credit cards that offer no payments and no interest for 12 months, will make your credit score drop by up to 60 points. I have such a hard time believing this, but he swears on it. Does anybody know if this is true? Has anybody heard a similar theory/rumor? This is troubling me. How can this be? 60 points is a lot for a credit score to drop...
Thanks,
[addsig]
Matty,
According to my mortgage broker "avoid like the plague long term installment debt like no intrest no payments for 12 - 24 months etc".
I suppose promotional rates triggered by a purchase or sign up of that rate / terms can also change the reporting of a regular credit card to a program that like you mention.
Attached ia a previous thread on the subject.
http://www.thecreativeinvestor.com/residential/modules.php?op=modload&name=Forum&file=viewtopic&topic=40641&forum=27[ Edited by happyhome on Date 03/21/2005 ]
I opened one, and it had no significant affect on my credit score...
Credit scores seem very subjective to me...
[addsig]
Point very well taken! Thanks!
[addsig]
I would think they would impact a credit score. You are basically taking on debt, but not paying it off. It is a great deal for you to have no interest, but they would view it as debt against you with no income to counter it.
I would also think that this type of activity is an indication that someone is just moving debt around without ever paying it off, which would be a pretty good indicator of risk in a scoring model.
On everything what I read, what I have learned it is not the the home depot card that you got affects you so you fico drops, the key is on the limit that you have and if you are over the 50% of your credit limit for home depot. I am still making credit and I do not want to run it until 2 months so I can check it out how I am doing
I also have a Home Depot and a Lowes card. I have made major purchases from both stores in the form of 0% int no payments for 6 months. But I also make payments every month. I am not waiting for the 6 months to expire before I start making payments. Your score will be effected not by the type of deal the store makes with you, but it will be calculated by how much of your available credit is left available to you. If most of your credit is used up then your score will be lower. Pay off the loans and your score will eventually rise again, as long as you havent messed up and missed any other payments that could affect your score.
[ Edited by theREIkid on Date 05/30/2005 ]
nope, but if u get it, let me know how it went.
go to www.annualcredit.com. Get your credit report FREE. If you want your score pay $5.00 and get it. Dispute any info that is incorrect.
Though I am not a lawyer, please read the Fair and Accurate Credit Transactions Act of 2003 (FACTA) which became effective December, 1, 2004. If you use the assistance of a "credit repair organization" (CRO) as defined by the Credit Repair Organizations Act 15 U.S.C 1679-1679j, you will forfeit your new FACTA rights.
Before using the service that you indicated above (or even a lawyer) it might be wise for you to research it.
Also, as a parting thought, "if it seems to good to be true, perhaps it is."
Good luck and feel free to PM if you would like more info
Derek
But all of the accounts are WAY past due... like years. Should I try debt consolidation or should I try ot pay them off one by one & get one of those high interest cards to try ot get my crdit rebuilt. By the way, thanks for the response.
Try and negociate a discount to pay them off. It works.
I agree with RUMAN. Sounds like you want someone (cedit card company) to pour more money into a sinking ship.
You need to pay your bills, then start the slow process of rebuilding your credit.
However , first you will need to ask yourself the ultimate questions of "Why did I get in debt to begin with?" Once you answered this and corrected the problem of overspending, then you can truely begin to re-build your credit - until the problem is fixed you will always be indebt.
I think debt negotiation might be the best way to go. I had a guy negotiate my bills down and he did a pretty good job. Private message me for the details.
Thank you all for your replys. I hope to recieve more. Also after posting I realized my error of posting in wrong area.
You may also want to consider birddogging. It will give you experience and cash.
You can wholesale properties. Wholesaling is the process by which you would locate the property, negotiate with the seller a price, place the property under contract by putting up earnest money only and assigning the contract to another investor who will in turn rehab and sale the property. The basically buy the ocntract from you. The key is to get the property at low enough price, that after rehab the property will sale for enough for you to at least make 5 grand and the invester 10. There are several books and courses on the details.
Also, crazyfnmama will you PM me the name of the credit repair company you used, thanks in advance?
Sorry, I am new.
What is REI?
REI = Real Estate Investing
[addsig]
When you pull a credit report on yourself, it is a soft pull and does not count towards your score.
Thanks Joe
What if the same mortgage broker checks my credit multiple times over a period of a few months?
Your credit score will be impacted negatively if the inquiries are spread out over a few months. The scoring models treat multiple inquiries in a 14 day period as just one inquiry and ignore all inquiries made within the prior 30 days.
Quote:
What if the same mortgage broker checks my credit multiple times over a period of a few months?
[ Edited by Money4RE on Date 06/05/2005 ]