credit score
13 questions
- Finance
Does closing a credit card hurt your credit score?
Yes — closing a card can lower your score by raising your utilization ratio and reducing your average account age. Here's when it's worth it anyway.
- Finance
How long does a hard inquiry affect your credit score?
A hard inquiry drops your score by fewer than 5 points on average and stops affecting it after 12 months — but stays on your report for 2 years.
- Finance
How long does it take to build credit?
You need at least six months of account history to generate a FICO score; reaching a good score (670+) typically takes one to two years of consistent on-time payments and low utilization.
- Finance
How do I remove a collection from my credit report?
Collections generally stay on your credit report for 7 years from the original delinquency date. You can remove them early by disputing errors under the FCRA, or by negotiating a pay-for-delete agreement with the collector — though collectors are not legally required to delete accurate, verified accounts.
- Finance
How do I use a balance transfer without hurting my credit?
A balance transfer temporarily lowers your credit score from a hard inquiry and a new account, but it improves your score over time by reducing credit utilization if you don't run up the original card's balance again. The main risk isn't the transfer — it's the behavior after it.
- Finance
What credit score do I need to get a mortgage?
Most conventional loans require a minimum 620 FICO score. FHA loans allow scores as low as 580 with 3.5% down, or 500 with 10% down. Your score also affects your interest rate — a 760+ score typically gets the best available rates, which can mean tens of thousands of dollars in savings over the life of a loan.
- Finance
What happens if I stop paying my credit cards?
Stopping credit card payments triggers a predictable sequence: late fees and penalty rates immediately, a credit score drop within 30 days, collections contact after 60–90 days, charge-off around 180 days, and potential lawsuit. The damage stays on your credit report for seven years.
- Finance
What is an authorized user on a credit card?
An authorized user is someone added to another person's credit card account who can use the card but has no legal obligation to pay the balance. The account's payment history may appear on the authorized user's credit report, which can help build credit — but the primary cardholder is entirely responsible for the debt.
- Finance
What is credit utilization and how does it affect my score?
Credit utilization is the percentage of your revolving credit limit you're currently using — it makes up 30% of your FICO score, and keeping it below 10% (not just 30%) gives you the best possible impact.
- Finance
What is debt settlement?
Debt settlement is negotiating with creditors to pay less than the full amount owed — often 40–60% of the balance — as a lump-sum payment in exchange for the debt being considered satisfied. It damages your credit and may result in a tax bill, and using a for-profit debt settlement company adds significant risk.
- Finance
What is a good credit score?
740 or above is where you qualify for the best rates on loans and credit cards. Getting from 650 to 740 saves far more money than getting from 740 to 800.
- Finance
What is the difference between a soft inquiry and a hard inquiry?
A hard inquiry happens when a lender pulls your credit after you apply for credit and can temporarily lower your score by a few points; a soft inquiry — like checking your own credit or a pre-approval check — has no effect on your score at all.
- Finance
What is the difference between VantageScore and FICO?
FICO and VantageScore are competing credit scoring models that use the same 300–850 scale but weigh factors differently — FICO is used by roughly 90% of top lenders for lending decisions, while VantageScore is what most free credit monitoring tools show.