I was interviewing a mortgage broker named Debi Merchain when she told me something shocking. To get the best credit score I need to have three active credit cards. What??? I thought I just had to pay my bills on time!
“A lot of people make the mistake of just using one credit card,” Debi said. Ideally you would make regular, on time payments on three credit cards, a mortgage and a car loan. The three main credit card reporting agencies, Experian, TransUnion and Equifax, like consumers who use multiple types of credit responsibly, Debi said.
I’m not in a position to buy a home so I’m not going to consider that option. But should I buy a new car and get another credit card? I paid for my used car in cash and have two credit cards.
That could help, she said. But don’t buy a car or get a mortgage just to bump up your score a few points. Because my housing and car needs are met, Debi recommended I get a third credit card and use it once a month or so. Just enough to show it is active and to establish a record of paying the bill on time.
Debi also said that the criteria the credit agencies use to determine your score changes. So three credit cards plus a car loan and mortgage won’t be the top standard forever.
If you want to know what your credit report looks like, once a year you can get a one from AnnualCreditReport.com.
March 30th, 2009 at 9:42 am
i don’t agree. in bankrate and other website
you can find opposite advices. one or two credit card are enough
March 31st, 2009 at 2:27 am
i don’t agree. in bankrate and other website
you can find opposite advices. one or two credit card are enough
Oops…forgot to say great post! Looking forward to your next one.
March 31st, 2009 at 1:43 pm
If you’re young, and have all of these possible expenses, then MAYBE it’s a good idea.
But if you’re over 60, we think it’s best to go back to the way we started our married lives…..with good old fashioned CASH. If we didn’t have the cash in hand, or at least in the checking account, we didn’t buy it. Period.
Still a GREAT idea in today’s uncertain economy.
And we also allowed just so much a month for groceries, cash which I carried in my coupon keeper when I shopped. Again, as the month wound down, I spent less. And actually, since I kept any ‘left-over’ money from each month in a separate fund (envelope:o)….we often had enough to eat out. With no worries about having our credit cards compromised by possibly unscrupulous
employees.
Just a few thoughts from an old lady!
And keep up the Good Work, Babe!
April 1st, 2009 at 10:48 am
Thanks Dogzmum! You bring up a good point. For some people, establishing a credit record is not a top priority.
April 3rd, 2009 at 4:27 am
Either you have a big adjustment like a 20 percent or 30 percent decline, or you have a big recession or you have a slow decline in property prices or several years of no growth.par
April 4th, 2009 at 2:59 am
Nice site! Thanks for the great post
April 8th, 2009 at 9:04 pm
Not that I’m impressed a lot, but this is a lot more than I expected for when I found a link on Delicious telling that the info is awesome. Thanks.
April 14th, 2009 at 12:11 am
Nice site! Thanks for the great post
April 19th, 2009 at 11:28 pm
A fantastic read….very literate and informative. Many thanks….where is your RSS button ?
April 21st, 2009 at 10:41 am
The RSS button is on the Email Updates/RSS tab at the top of bargainbabe.com.