As I mentioned last week, I’m in the midst of one more refinance.
Today, the appraiser came, and looked around. Given that the loan to value is less than 35% on my guestimated value, I’m not too concerned. On the other hand, I’m always curious how accurate sites like Zillow are. I don’t care so much what the house is worth. When we move, it’s all relative, if we move into a like neighborhood, the transition would be lateral, sort of a trade. If we trade down, we’ll pocket some money, but that’s not in the plan.
I also just got my credit scores in the mail. There is a bankruptcy score, I scored 476 on a scale of 1 to 600. Never heard of that before. Don’t know if it’s good or bad. Then the actual credit score, drumroll, 800. I trust this to be a FICO score, maybe it’s not. Credit Karma is not quite the same, but close. It had me at 784 the past few months, but dropped me to 782 for the fact that I had this “hard inquiry” in submitting this application. I’d be higher except I have “Too many open accounts with outstanding balances.” Interesting. I pay in full every month and have been using 3 cards. An Amex Open that gives 5% at office supply stores and 3% for gas, and 2 cards from Citibank both giving miles on American Airlines, one an Amex, one a Mastercard. Citibank runs promotions that vary for each card. Also, some stores (like Costco) only take Amex. I suppose after I close on this new loan, purely for research, I can experiment by paying these cards before the statement is cut. The float has little value to me as rates are so low, and it would just be a data point to add to my understanding of how these thing impact the scores. Also I should check my AnnualCredit Report and see if any accounts show open that I meant to close. I had opened a WaMu (Washington Mutual) account as they provided an actual FICO score, but that deal is gone with Chase taking them over. Time to cancel that one.
When it comes to your credit score, some things are counter-intuitive. Refinance to a lower rate, and cancel a bunch of credit cards, grabbing one new one that has no fee and low interest and then max it out consolidating all the high interest debt, and you may very well trash your credit score. It’s all relative though, I can take a hit and easily recover from it. It’s more a science project for me than anything else.
For more reading on this topic, check out The Military Wallet’s article Credit score needed to refinance a VA Loan and Wealth Pilgrim’s 5 Ways to Improve Your Credit Score Fast.
(By the way, today is the 33rd anniversary of the release of the original Star Wars, I can still recite the opening introduction word-scroll)