Here's our next question from Jeremy.
I used to be partial to the idea of having one card myself--certainly makes it easier to track your spending.
Discover and American Express are not always accepted so you might want a MasterCard or Visa if you carry one of them. You could have a spare card in case you lose your main card
But I think in addition to a variety of types of accounts (revolving lines of credit like a credit card, auto loans, mortgages, student loans), your score may benefit from showing that you hold more than one card.
If you are using a card that gives you rewards, you probably want to concentrate your spending on that card. However, you might want a card with gas rewards if you drive as a second card.
Right Joan. I went to Costco yesterday and they only take AmEx and debit cards. I usually use my MasterCard, so I was happy to have an AmEx in reserve.
So, it sounds like it mostly comes down to personal preference/spending habits.
You probably can't get a "perfect " score if you don't have a mix of credit - auto loan,mortgage and credit card but you can get a score that is high enough to qualify for the best rates if you have good habits
Probably. I'll have to check with our sources to find out if having more than one card can help your score.
True Joan--very few people have the "perfect score" and you don't really need one!
In some ways, it's about making the cards work for you (i.e. rewards, perks, etc.)
Having a second card will add to the amount of available credit you have so you are likely to user a smaller percentage of it, which might help your score.
That's a good point, Joan. Definitely something to consider
Speaking of the "perfect score," here's our next question from JJ233.
I just wrote about this in my story 6 Things to Know About Your Credit Score
It all depends on what scoring method was used to calcuate your score
Your score should be about 720 or higher to qualify for the lowest rates. That number does fluctuate some
For example FICO runs from 300-850 and most of the bureau scores mimic that
But VantageScore runs 501-990
Joan's correct, a 720--on the FICO range--should be good enough for the best rates on most things. You'll likely need a 760 to get the best mortgage rates
You can get a free score from Credit Karma that will give you an indication of your score but it won't be what a lender gets
Can I throw in something on where to get your score?
If you're in the market for a home loan, go directly to MyFICO.com--it'll cost $20, but it is most likely what the lender would be looking at.
Otherwise, you can get it a variety of places, but beware of any site promising a FREE score...usually they require you to sign up for a paid monthly credit monitoring service.
Definitely something to be aware of, Jessica. Great tips!
If you are denied credit or don't get the lowest rate, the lender has to give you a copy of your credit score
I think Credit Karma is an exception to that rule!
Yup, and it has to be what they used to deny you and they have to point to why.
Alright, speaking of applying for credit, here's our next question from CC question.
Credit Karma doesn't sign you up for credit monitoring but many places do. Jessica is right,. You have to read the fine print or you'll start getting a monthly bill
So, a lender does have to explain why they turned you down? That's good to know.
That's probably a good amount of time.
That is another new consumer protection
Here's a good question from TwellsC