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Originally Posted by angry pancake
It has more to do with the credit limits you have with how much of that limit is used. So in a backward way, the more credit you have with less debt creates your score.
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That's what I meant by this:
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Definitely keep your limit below 33%. This is the biggest differences I've noticed.
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I said it kind of confusing, but what I meant was keep your balance below 33% of your limit. If your limit is $10k, try not going over $3k.
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DTI and history play into it, but it really ties into it more than anything.
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Are you sure income has anything to do with FICO? After they ask you what your income is initially, they never check again. DTI counts huge for mortgage loans (which I acknowledge is a type of credit), but I don't think it actually affects your score.
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Originally Posted by f3lix
No, that's what is stupid about the whole credit thing. You have to pay interest to a bank in order to raise your credit. When I bought my car, I found out my credit wasn't as high as I thought it would be, all because I hadn't made payments on a large purchase before, due to paying everything in cash. So all because I've never had debt, my credit score was in the low 700s.
Clearly to me, credit is just another way the banks have figured out how to force you into getting loans and paying the banks interest.
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It's true that buying a house without a mortgage doesn't raise your credit score, but why would it? Credit reports are basically a way for lenders to see what your track record for paying bills on time is. Having a lot of money doesn't mean you pay on time. You can raise your score without paying interest by doing what I said above. Use your credit card for most purchases, and pay the balance in full every month. If you get a card with reward points, you get also get free shit (like cruises).
For things like cars and houses, of course you have to pay interest. If you don't want to pay interest, save up and buy with cash. But then that has nothing to do with credit, and therefore won't and shouldn't raise your credit score.