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What Does Available Credit Have to do With Your Credit Score?

June 11th, 2010

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The amount of credit you have open is a considerable element in your FICO score. As you can tell from Home Loan Credit Score, up to 30% of your score is concerned with how much outstanding debt you have, in contrast to to how much credit you have open . Having less than 50% of your available credit open can have negative results on your credit score. It’s good to try and keep 75% available credit, as this demonstrates low risk behavior and can significantly increase your credit score.

Another important thing to pay attention to is, after you pay off a debt, do not close the account , even if you have no intention of using it in the future . By closing the account you are reducing the amount of available credit you have available and in turn lowering your FICO score. If you have already closed accounts after paying them off , make contact with the creditors and attempt to negotiate opening the accounts again . To be clear, this does not mean to get them give you a new account with he same creditor, as this is is completely different and will not be counted toward your length of credit history. Instead, try to enourage them to allow you to reopen the closed account with that account’s history intact.

By monitoring your credit report and guaranteeing that the important pieces of your credit are well-maintained , you can keep your credit score as high as possible , or even raise it considerably in as little as 60 days . While maintaining a good payment history and maintaining available credit at a maximum are imperative to keeping your score high , there are other credit related issues that affect your credit score even more . To find out more about credit score repair, Credit Score Professional and other issues that affect your FICO score, go to Home Loan Credit Score and see what you need to know about maintaining good credit.