I'm no CPA but I would like to add my experience in keeping a low debt/income ratio. This magical 20% ratio has helped me a lot when playing in this credit score system of the beast.
One thing I have found out is when I would pay off a card and then stop using that card for 1-2+yrs my score would drop. Credit history is tied to the score, so when they deactivate cards from being idle you lose credit history.
I don't know how transfers work. But when I paid off a student loan my score took a huge nose dive. And I think that was because of no longer having that credit line and/or it was no longer reporting so the history was gone. Whereas if you keep a credit card active that history stays reporting. So I imagine if you lose/close a credit card that you have had for a decade or more I imagine the score would also go down.
Debt is bad but in their beast system not having debt is bad. If you want participate in their beast system then you need to at least play along.
I'm no CPA but I would like to add my experience in keeping a low debt/income ratio. This magical 20% ratio has helped me a lot when playing in this credit score system of the beast.
One thing I have found out is when I would pay off a card and then stop using that card for 1-2+yrs my score would drop. Credit history is tied to the score, so when they deactivate cards from being idle you lose credit history.
I don't know how transfers work. But when I paid off a student loan my score took a huge nose dive. And I think that was because of no longer having that credit line and/or it was no longer reporting so the history was gone. Whereas if you keep a credit card active that history stays reporting. So I imagine if you lose/close a credit card that you have had for a decade or more I imagine the score would also go down.
Debt is bad but in their beast system not having debt is bad. If you want participate in their beast system then you need to at least play along.