Comments on: 25 Rules to Grow Rich By #18: Credit Scores http://www.thesimpledollar.com/2006/12/06/25-rules-to-grow-rich-by-18-credit-scores/ Simple, applicable personal finance advice for the modern world Fri, 10 Feb 2012 07:17:51 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Fuller http://www.thesimpledollar.com/2006/12/06/25-rules-to-grow-rich-by-18-credit-scores/comment-page-1/#comment-120809 Fuller Mon, 26 Nov 2007 14:30:35 +0000 http://www.thesimpledollar.com/2006/12/06/25-rules-to-grow-rich-by-18-credit-scores/#comment-120809 I was told something similar about leaving open lines of credit that you are not using. Many times when a bank looks at your financial situation they don't just analyze your credit score, they create a Bankruptcy score as well. This is something that is calculated by: 1)your credit score 2) your salary 3) your potential for becoming further in debt than you already are. Essentially by having several open lines of credit (by keeping open cards you no longer use), you have the potential to run up thousands of dollars in debt on a single day though the use of the cards. So when a bank sees that you have access to 30K in loans, and you are asking for a 30K car loan, it thinks twice before extending you any more credit than you already have. I was told something similar about leaving open lines of credit that you are not using. Many times when a bank looks at your financial situation they don’t just analyze your credit score, they create a Bankruptcy score as well. This is something that is calculated by: 1)your credit score 2) your salary 3) your potential for becoming further in debt than you already are.
Essentially by having several open lines of credit (by keeping open cards you no longer use), you have the potential to run up thousands of dollars in debt on a single day though the use of the cards. So when a bank sees that you have access to 30K in loans, and you are asking for a 30K car loan, it thinks twice before extending you any more credit than you already have.

]]> By: Nathan http://www.thesimpledollar.com/2006/12/06/25-rules-to-grow-rich-by-18-credit-scores/comment-page-1/#comment-723 Nathan Wed, 06 Dec 2006 17:03:55 +0000 http://www.thesimpledollar.com/2006/12/06/25-rules-to-grow-rich-by-18-credit-scores/#comment-723 I was told by my bank that having open lines of credit is a bad thing if they are not being used. I understand the debt/credit ratio and couldn’t agree more, however wouldn’t it be better to keep the lines of credit open that you can use and pay off completely each month. I was told by my bank that having open lines of credit is a bad thing if they are not being used.

I understand the debt/credit ratio and couldn’t agree more, however wouldn’t it be better to keep the lines of credit open that you can use and pay off completely each month.

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