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fla-tan · #31 (**permalink**) 10.19.2002, 11:15

Quote:

Originally posted by Lizardking
Here is my tip for boosting your score real quick for a big loan you are expecting. This will work assuming you have a mostly clean report of other negatives.

The past 2 months I have been getting my credit report(s) ready for when I apply for my mortgage next month.

To absolutely maximize your score, the best thing you can do in the short term is to pay down credit card revolving balances.

The problem is that even if you pay off the balance in full, the credit card reports the balance that was on there at the closing of the statement. So if you charge $2,000 and pay it off as soon as you get the bill, your report still shows $2,000 in revolving debt.

The trick is to pay off the account prior to the statement closing. This will cause the satement to close with a $0 balance and the report to list $0 in revolving debt.

I did this last January prior to a car lease and it boosted my Experian score from 714 to 762 by merely getting my revolving debt down from $3,000 to $250.

I have been paying off all of my balances prior to the statement closing for two months now just to give myself a cushion in case they don't report each month.

I have Equifax up to 742 and Experian up to 730.
The ONLY debt on my reports right now is my wife's auto lease with $17,300. It is from Jan 2002.

Lizardking

This is an excellant technique. The important thing to remember though is to pay before the cycle closes. Keep your debt ratio low and your FICO score stays high. Also, and this is VERY important to remember, DO NOT buy anything on credit nor apply for credit between the time you apply for a mortgage and the time that you close. It is common practice for mortgage lenders to pull credit either the day before of the day of closing to make sure there has been no material changes in your credit. Any inquiries after approval will require an acceptable explaination and if there have been alot of inquiries within the past year, underwriting many times will require that they be explained as well.

fla-tan