July 6th, 2010
Answers To Your Credit Score & Credit Card Questions
If you are looking for all questions and topics that are credit-related, you’ve stumbled into the right place! The Credit Advice Center at Credit Karma is keeping busy with hundreds of questions asked by consumers and answered by consumers too.
Below is a glimpse of conversations popping up right now. And feel free to stop by the Credit Advice Center yourself and submit a question of your own, or browse through posted questions and suggest an answer! It’s the new way to empower yourself through consumer-generated knowledge.
Question: To boost my credit score, should I pay off a student loan over time or right away?
Your Answers:
- Paying them off at once will be more beneficial to your credit score than paying them over time, especially if you have other accounts (like a credit card). The effect of reducing your debt is greater than the effect of making on-time payments on an open account…
Question: What does “charge off” mean exactly?
Your Answers:
- Many people mistakenly think when a debt has been charged-off that it’s been cancelled by the creditor. This is not true. You are still responsible for paying off the debt. However, you will not be able to use your credit card to make purchases…
Question: How often to use a paid off credit card to keep line of credit open?
Your Answers:
- The short answer is to use each of your cards once a month (and pay them off) to maximize your credit score….
- Thank you so much for your suggestions…once a month is a lot to demand from these companies… I have heard every 6 months would suffice…..
- So far, with the two companies I have credit with, one has a “one-year” clause of closing the account for inactivity and the other has a “six-month” clause. So I think you’re on the money (so to speak
– six months is the minimum that I’ve heard of or encountered but some banks go longer (e.g., Chase) before penalizing in some way… - The new credit law that just went into affect BANS inactivity fees…
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Can someone please tell me how a foreclosure could possily increase my credit score??? I was playing around with the simulator on this site to see what I could do to increase my score of 635. I tried adding a new credit card, paying off my credit cards, and making payments on time. None of these gave me an increase in my score by more than 7 points. I cleared the simulator and chose foreclosure (only), and my credit score increased from 635 to 679. I don’t get it. How could a forecloser on my report increase my credit score? It makes no sense to me.