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Many times I have been asked questions by people specifically about their credit.  Here are a few examples of frequently asked questions.  Does it hurt me if someone accesses my credit? I have a few credit cards with high credit limits but no outstanding balances.  I heard that the potential to run up your credit cards is frowned upon by credit bureaus.  To establish credit, I was told that you can open a credit card, but you must use it and keep a balance.  Are these facts or fallacies?

Inquiries into your credit are sometimes harmful, but only if done excessively within a short period of time, and usually are only harmful to fragile credit ( scores below 600 ).  If you have a credit score in the 700s, you need not worry about a few inquiries now and then.  They are necessary in order to apply for any form of credit.

Having some credit cards with high limits but no balances does not hurt your credit rating at all.  On the contrary,  showing balances much lower than the high credit limits boosts your credit rating. 

Establishing credit means opening new accounts.  If you open a revolving charge card of any type and don't use it,  the credit bureau will continue to show on time payment history throughout the lifetime of the account.  Whether or not you show a balance doesn't effect the payment history.  The payment history will show as paid on time even if you never used the card.  Make sure that when you use the card all the payments must be made on time.

Next time you are at a cocktail party and you overhear a know-it-all telling these so-called facts about credit, you can set them straight.

Andy Williams

EHJM Mortgage Corp



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