Credit Scores

I guess since there is a high number of unemployment and the housing market sucks, there have been many articles written about credit scores. For the past several months, I have been reading the articles, mainly to learn more about how credit scores work. Here is a summary of what I have learned:

1. If you pay your bills on time, you will have good credit. If you pay your bills on time, you could have bad credit because you are not building a credit history.

2. If you have more than one credit card, you will have bad credit. If you only have one credit card and don't' take advantage of all the credit that is available to you, you will have bad credit and loans will be harder to come by.

3. If you open a credit card, your credit score will be affected negatively. If you close a credit card, your credit score will be affected negatively.

4. If you pay your credit card bill in full, you will have good credit. If you pay your credit card bill in full, this will effect your credit score negatively because you are not building a credit history.

5. If you take out a mortgage and don't buy a house for the full amount you were approved for, it could result in bad credit history because you are not taking full advantage of the credit available to you. If you take out a mortgage and take out the full amount you were approved for, you will have bad credit because you took out the maximum amount of credit you were approved for.

6. If you take out a car loan instead of paying in cash, your credit score will be affected negatively. If you pay for a car with cash instead of taking out a loan, you are not building a credit history and this could reflect negatively on you when you go to purchase a house.

7. If you try to make sense out of how credit scores work, you will go insane.