The Most Essential Key to an 850 Credit Score
The most common mistake that even the most savvy investor makes is closing unused accounts. This can impair them from ever reaching an 800 or higher credit score. You should almost always leave open older accounts because they may be what we call "Golden accounts."
The Coveted Golden Revolving Account
The big difference between a 700 credit score and an 800 credit score is usually the length of time the revolving accounts (i.e. credit cards) have been open. Once you have an account that has been open for 7 years or more you should never close it. This is because that account will help you achieve an 800 credit score. One of the most effective credit raising strategies is to obtain two to four Golden Revolving Accounts in your credit report.
Too Many Open Revolving Accounts Can Hurt
This is where it can get a little confusing. If you have too many open revolving accounts (credit cards) in your credit report and you already hold four Golden Accounts, you can close those cards (revolving accounts) that have been opened the most recently. In addition, you need to always hold on to at least one bank or national credit card open with your file.
To say it in simpler terms: The only occasion that you should start closing credit cards is when you just show too many but you also have 4 or more Golden Accounts and 1 or a couple national or bank credit cards to show valuable credit once the frivolous cards are closed.
Home Buddies is a investor credit repair coach for real estate investors. Home Buddies develops and implements a customized strategy to improve credit and builds a business development strategy to help investors or homeowners overcome obstacles to financing real estate and growing their portfolio.
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