Will paying down credit card debt with a Home Equity product affect your credit score?

Answer 1

Just don't close those accounts. It should help your score. Here is a excert from Phil Turner's Credit Bible. Its a good reference to get information about this matter. Here are points to consider: 1. Concentrate your efforts on entries in your credit report that's less than two years old. Some things are not that important to challenge when attempting to increase your credit score. Personal information, e.g. address, employment, birthday are not important to your credit score. If you see a different name or social security number on your credit report, take notice, you could be a victim of identity thief and must make this a high priority to look into this matter to have these items removed. Important items are as follows:A. Collection accounts less than two years old and duplicates collection accounts. Some collections accounts are report twice and total illegal. Make challenge this one of your highest priority. B. Other duplicate items. C. Accounts that do not belong to you should be a high priority. D. Credit Card Limit being reported correctly should be a high priority. 2. Important: Reduce the balance of your credit cards to 30% and below of your credit limit. If you have a credit card with a $5,000 limit, your balance reported to the credit bureau should be $1500 and under in order to have a excellent credit score. If you go over this amount it will affect what is called your "utilization rate." Credit score formulas respond favorable to utilization 30% and below. It's a good idea to assess all of your credit cards and align them correctly with this formula. Use the form in the appendix. Please note: if you have an American Express card or card with no preset limits. You will be rated on the highest credit you have charged and the 30% rule still applies. Try using the card to increase your high credit limit by spending more with the card with cash you were already going to use and get that limit up to a ratio that will keep you within 30% of that high credit. This is why if you pay your credit off each month in full will not give you a great credit score.