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How To Pay Bills?

How should I pay for my bills to boost credit.?

  • I am looking to get approved for either a conventional loan or an FHA loan in September for a condo. Mt credit is 515. I have credit card debt, medical bills, car payment, student loans, and other small bills. I am spending 1,300 a month in bills. I am trying to cover my debts and boos my credit score for better chances of working with a lender. I have paid off one student account which is one less debt. I have an application for a secured credit card which is to help people rebuild credit. On this card you have to have a deposit. The higher the deposit, the higher your credit limit. I have been thinking about ways to pay off my debts on time without financial stress while improving my credit. I am thinking of asking for a credit limit of $1,500 and using the credit card to cover my monthly bills because they are all due on different days of the month then paying off the balance of the credit card with cash. Is this a good idea? What do you suggest? My bills are only $1,300 per month total. Having a card with a limit of $1,500 gives me security so that I wont go over the limit before I pay off the monthly balance on the card.

  • Answer:

    You already have a credit card that needs to be paid off.. why not use that one for this "project"? It is not a good idea... because a huge part of your credit score is calculated by how you use your credit cards. Never use more than 30% of a cards limit in a billing cycle and pay them off periodically or better yet every month. Even a secured card falls into that category... so when you use up 1300 of 1500 each month you ruin your credit constantly because you are too close to your limit every month. It does not matter that you pay that off.... it matters that you use too much of your credit in a billing cycle. Pay off the existing credit cards if you need a big boost to your credit score. You can achieve that within 90 days from paying the cards off completely and leaving them untouched for another 60 to 90 days or at least until AFTER you get your mortgage loan approved.

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- Update: Being that you're rude, I won't bother answering your question.

CatDad

to boost your credit you need to pay all creditors on time and keep CC debt under 30% of the limit. Your thought is far to complex and not practical. Excellent credit is easy pay everyone on time every time. Save some frustration there is no way you can get your score high enough for a mortgage by September. It will take a minimum of 2 years starting where you are for you to gain enough points

Calvin C

Hello, There are many ways to increase your credit report.First of all you have to know that there is no fast way to see some changes.But that does not mean you must not take action. First think is to get your free credit report.I'd recommend you to get it from: http://EliteCreditRatings.com .They offer 100% free 3 in 1 credit report, credit monitoring and fraud protection.I'd strongly recommend you to subscribe for all of these, because your information will be safe.You'll have a lot of problem if you become a victim of identity theft, which is one of the most common crime these days. Check your credit reports carefully for errors.Most of the reports contain a lot of errors.So check carefully and if you find any report is to all 3 main credit report companies(All of them have dispute centers). Late payments can hurt your credit report.So pay everything on time. Pay more than the minimum on your credit cards.Paying only minimums is a loosing strategy.I'd recommend you to pay +25%. Use only one credit card.If you have more, cancel them.If you need more use debit or prepaid cards. Don't go to credit repairing companies.First of all try to increase your credit without help.If you can't then you can try that, buy be careful for scammers. Be consistent and you will increase your credit. Hope that helps

Nicholas

No, it is not a good idea. You will increase your expense because of "cash advance" fees when you use your new card to pay off bills that are not normally paid with a credit card. {and the effective limit on $1500 LOC is $500 usable.} Take that money you were going to use for the secured credit card and open (or add to) a checking account. Direct all of your other money to this checking account. That includes putting savings account money there, too; as well as your paychecks (direct deposit if possible). Then set up automatic monthly payments from the account to cover your bills. Sit back, and in a couple of years when your bills are paid off, you will have boosted your credit score. Try to get your cc paid in full, then pay it off in full every month. That will save you a lot of interest expense.

SumDude

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