Pet Your Credit Score, Save $$$, and Earn Miles/Points.

Posted by Noob Master on Mar 27, 2012 in Credit Cards, credit reports, Miles, Uncategorized | 6 comments

The first question people always ask me when it comes to applying for rewards credit cards is, “Won’t it hurt my credit?”

This is a great question, because protecting your credit is very very important. Duh. We know that, but the answer to the question I have answered more than “Does this look good on me?” is Yes….to both.

In the last 12 months, I have signed up for over 12 rewards credit cards and have earned over 750,000 miles, while taking out 2 auto loans and refinancing my house at the BEST interest rates. Applying for rewards credit cards cost me $000000.00000 on the loans I took out. Obviously, my credit score is still in excellent condition.

Alright, so what are the ways that I protect my Credit? Well let me lay out 3 tips for you.

Knowledge is Power.

If you don’t monitor your credit report, then get it together! It’s crazy to apply for rewards credit cards without knowing your credit score first. Especially, when you are throwing app parties every 90 days. Before you throw down on 3-5 credit cards, you BETTER know where you credit stands. Plus, you want to monitor your score after the apps, so you can adjust your app schedule if need be.

I learned the hard way that protecting your credit is very important. When I was a freshman in college a certain chain bank named Wells Fargo preyed on me. They pretty much stuffed a student credit card down my throat. I had to take it. I really had no idea of how important your credit was, and I misused the hell out that card. Yeah, it was fun back then buying posters for my dorm or taking girls out on dates. I think that’s is what I blew my money on. But trust me, it wasn’t worth it. It took me 8 years to repair my credit because of my childish ways. Learn from my past mistakes on how not to handle credit.

Put UP a Fight.

If while monitoring your credit, you see something that is wrong, don’t accept it. Put up a fight. You have the right to dispute ANYTHING on your credit report. Last year, my wife received her monthly credit update and we noticed that it dropped 150 points! I about puked. Actually, I’m a fainter, so I about fainted. But after the initial reaction, I actually chuckled a little bit when I saw her low score, because she used to mock my low score. Now that my score was much much higher than hers, I had bragging rights. I quickly stopped the mocking though, and started searching to see why her credit had dropped. Within seconds, I saw that Tmobile had reported delinquent activity. We hadn’t had Tmobile for over a year so we were shocked. During our relationship with Tmobile we never had a late bill or received a billed after our contract was up. I was furious (but still a little giddy that I had a better credit score and bragging rights), so I quickly printed off a dispute form from my credit monitoring site and filled out the information and mailed it in. Too easy. The next month, when we checked her credit score, I no longer wore the big boy credit pants in the family…again. Seriously, it took me 5 minutes to dispute a false claim. A claim that I wouldn’t have seen unless I was monitoring our credit.

One simple delinquent activity had lowered her score 150 points! That’s huge. If we hadn’t been monitoring her credit score, we couldn’t have refuted the claim. She wouldn’t have been able to apply for any rewards cards. And forget about getting a good rate for a mortgage or car.

PET

Give your credit a stroke while whispering sweet nothings in its ear. Everyones credit is different, but it is important that you understand how to maintain a good score. A few tips:

• Pay your rewards cards balances in full every month. I know life throws you curve balls sometimes, but try your best to do this. You must be disciplined.
• If you do have to keep a balance, keep in under the 20% mark. It’s best to keep your credit utilization under 20%. That means your debt to credit ratio.
• Long average age of accounts really helps your credit score.
• Diverse credit accounts such as: credit cards, retail, auto, and mortage.

— Noob Master