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credit

Yet Another FICO Credit-Scoring Myth

Have you ever heard about how you can unlock your car by having someone transmit a signal from a spare remote key via your cell phone? Pretty cool, huh? Well, it doesn't work. Keyless remotes and cell phones operate on completely different frequencies, so don't plan on this trick ever saving the day the next time you lock your keys in the trunk. Regardless, I've heard this urban myth so many times over the past few months that I even started to believe it might work. That is, until I saw it busted with my own eyes on perhaps the greatest show known to mankind—Mythbusters. Seriously, I can't get enough of the Discovery Channel.

Credit Scoring Myths

I’ve been hearing a lot about credit scoring myths these days in our Credit Talk forum. You've probably heard many of the ones I'm thinking of too: "quick and easy ways" to magically add points to your credit scores in a short period of time. Usually they're the same ones that have been circulating around for years, like these two favorites:

  • Close any credit card accounts you don’t use, increase your income, and your credit score will increase too!
  • Just use cash to pay for everything and your credit will be perfect!

I hope you haven’t fallen for any of these. If you have, I’m happy you're taking the time to visit this site and educate yourself about credit cards and how to use them responsibly. It's definitely a step in the right direction.

Ask Creditnet: Is an 800+ Credit Score Worth the Extra Effort?

Dear Creditnet: I already have pretty good credit scores in the 790's, but it kind of bothers me that I can't seem to break the 800 mark. I've tried for years and I just seem to be stuck where I am. Is it really worth the extra effort to try and raise my credit scores above 800? - Megan from TN

To Sign or Not to Sign? Does the "See ID" Practice Really Work?

ID There's a lot of confusion among consumers about whether writing ‘See ID” on the back of a credit card is a smart move. I can certainly understand why, since there's a great deal of conflicting information available on the web. While it’s tough to prove this practice will actually prevent identity theft, I personally find it hard to believe it hurts. However, as far as Visa and Mastercard are concerned, a credit card is technically not valid unless it's signed. Merchants are even instructed to not accept credit cards without signatures.

Credit isn't Debt!

It's time for a bit of a Friday rant. I apologize in advance, but I get so tired of listening to people talk about credit as if it's synonymous with debt. It happens to be one of my biggest pet peeves, and I've heard it way too much lately, so I think it's about time I vent some frustration and set the record straight. Begin rant.

10 Ways to Destroy Your Credit in 2012

I think I might vomit if I have to read one more "10 steps to financial freedom in 2012" blog post. They all say the same things.  Make a budget, track every penny you spend, build an emergency fund...blah, blah, blah! Don't get me wrong.  Those are each important parts of personal finance, but aren't you bored of reading the same old stuff?  I certainly am.  So I'd like to take a different spin on things for my first post of 2012. Want to destroy your credit this year?  Here's 10 ways to make it happen:

Micocredit: More Good Than Harm?

I was recently in Bangladesh working with a local nonprofit organization that specializes in microcredit programs.  To demonstrate the success of their lending, they took me to meet a woman named Baby Chakma who lived in the remote southeastern hill country.

Baby had won an award from Citibank for her use of microcredit loans to successfully turn her home into a thriving farm and business.  When I visited, her small thatch hut (shown below) consisted of a storefront facing the dirt road, a room for growing mushrooms, and various small vegetable fields and cows surrounded the structure.

Credit: What's Love Got to Do With It?

Live, Laugh, Love. Three simple verbs, yet many have deemed them the motto of their life. I used to think it was pretty cheesy, but when I took a second to think of the deeper meaning behind these words, I realized it’s not such a bad motto to use.  So what does it have to do with your credit? Well, everything.

Short Sales and Foreclosures Have Same Effect on Credit

Are you confronted with a possible short sale or foreclosure on your home? If so, you may be wondering how long it will take your FICO scores to FULLY recover after one of these bombshells hits your credit reports. It's a great question, and it happens to be one that we receive emails about every day. Well, now we have some hard data from FICO that finally helps clear up all the confusion around FICO scores, short sales, and foreclosures.

Ask Creditnet: Should I Cut My Credit Limit?

Dear Creditnet: My wife and I have excellent credit scores, but we used to only have one no annual fee credit card with a limit of $10,000 (balance is paid off each month). I recently opened another credit card with better rewards and it has a $20,000 credit limit.

I've been told not to close out our first credit card account, but should I lower the credit limit on it to somewhere around $500 since we won't be using it? Or will our credit scores be negatively affected by lowering our available credit limit from $30,000 to $20,500?

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