I just stumbled upon this article at Bankrate.com titled ‘How credit scores work‘. It seems a little old, but it’s new to me. The credit score powerhouse Fair Isaac (think FICO), is interviewed in the article, so that gives it some credibility. Here’s the skinny on what makes up your credit score, from most important to least:

35% – How you pay your bills (on time or not) – I don’t really have to worry about this one.

30% – Amount of money you owe and the amount of available credit – It’s not just how much debt you’re carrying, it’s how much of your available debt you’re taking advantage of. Another reason why it may not be a good idea to cancel unused credit cards.
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With all these higher interest rate opportunities like T-Bills ans SavingsBonds, I’ve been itching to apply for another of my favorite 0% balance transfer offers after recently paying off one of my current ones, but I’ve decided to wait at least another couple weeks. My reason? I figured since I just went from over 50% utilization of one credit card to zero, my credit score will jump up once all the credit bureaus hear about it. (Also supported by the FICO Score Estimator.) But since they only seem to get information once a month, they may not know about my good deeds yet. And I want the fattest credit limit I can get so I can maximize my earn interest off of borrowed free money.

So for now, I’ll have to be patient, and maybe find some more tasty credit offers.

I haven’t been as active in the 0% APR balance transfers game recently (still have $20k in borrowed money), but sometimes the trickiest part after finding the best 0% offer is to figure out how to get your cash.

It seems like some issuers are not playing well with others recently. Flexo at Consumerism Commentary reports having his credit balance request sent from Discover denied by MBNA. I’ve heard similar problems with American Express, although I have gotten checks from them before. The good news is that if you transfer to Citibank, they now let you request a check for any credit balance online. So for sure they let you do it, and on top of that there’s no human to question your motives (not that you’re doing anything wrong). Definitely the best choice, if you have to go that route.

Of course ideally, they just let you write a check directly to yourself for the money, or take your bank info and electronically transfer it there. Banks that I have done this with before, and from what I hear continue to do so, include Citibank, MBNA, and Chase. Bank of America used to, but they just bought MBNA, so I’d double-check. Overall, Citibank seems to be the most flexible care issuer, either as the place you get the balance transfer or the place to send it to. Nice that they also back it up with great Rewards cards.

I’ve updated my How-To Play the 0% APR Game post to reflect these changes.

Added: Here is a screenshot of me requesting a credit balance refund on my Citi card:

MBNA is currently offering a free credit report and score from Equifax for cardholders at the following site. I read the whole long terms and conditions, and there is no ‘free trial’ or anything to worry about. You must input a valid MBNA credit card for verification only (My only MBNA card is my 2% Cash Back 529 card), and it will not be charged. You must use the link above and only the link above to get the free report. I went through another link and was asked to pay $19.95 for 3 months of credit protection. It should read “Privacy Assist Single Credit Report… $0.00 / Complimentary”, which includes:

» Credit Report – Unlimited 30-day access to your credit report with data compiled from Equifax.
» Credit Score – Snapshot evaluation of your current creditworthiness.
» Credit Analyzer – Credit tips and tools to help you improve your credit rating.
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While I’m still happy with the three main credit cards that I use for rewards, I just noticed that Citibank has come out with two new cards with good rewards:

Citi mtvU Platinum Visa Card – 5 ThankYou Points per $1 spent on restaurants, bookstores, record stores, movie theaters, and video rental stores

Citi Home Rebate Platinum MasterCard – 6% cash back for 6 months on utilities, cable tv, satellite tv, other pay tv and radio services, internet connection and telecom services.

ThankYou Points are Citibank’s new rewards system. To be very, very general, 1 point = 1 cent. For example, the reward that appeals to me the most is the $50 Target Gift Card for 5,000 ThankYou Points. It’s not as good as cash, but I shop at Target regularly so it’s basically the same for me. Here is a .pdf file of the whole catalog.

Each card has other features, but this basically means you’re getting 5+% back on all those things – with this and my existing Citi Dividend Select Card which gives 5% back on grocery stores, drugstores, and gas stations, I’d be getting 5% back on the majority of my purchases! Too bad the Home Rebate offer is only for 6 months.

The mtvU card is targeted towards students, even gives you up to 2,000 ThankYou points twice a year based on your GPA last semester! And you also get 25 points a month for paying your bill on time and not exceeding your credit limit.

[Update: I have some reports that Citi is asking for transcripts from some, but not all cardholders. It may be just for people who want the extra GPA points though.]

[Update #2: For 3% back on Restaurants, Auto Rentals, Gas, and Office Supply Merchants, check out the Citi Professional Card ($100 bonus currently too!]

If you have a Citibank or Chase credit card, you’ve probably gotten one of these checks in the mail like I just did:

It sounds too good to be true, someone just sent you a $20 check for trying out some insurance? Sure! You know these people are just hoping you forget and start paying these random fees for who knows how long. I’m very paranoid about these things, but I also love free money. I’ve definitely cleared more than $100 on these checks. So here’s my standard procedure when I get one of these things to minimize time and worry.

1. I only do this for cards that have no balance and are in my safebox. This way, I know if I get a bill there’s something up. You don’t have to search for a random charge hidden in your purchases.
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If you live anywhere but the East Coast, you already have had access to a free annual credit report from each of the three major credit bureaus, as mandated by the government. Access to states on the East Coast* was supposed to start on September 1st, but according to some impatient people 😉 it is available now, five days early. So if you want to beat the rush, go for it! The official website is here: AnnualCreditReport.com. Don’t confuse it with those other “free credit report” sites that make you sign up for a 30-day trial.

Note that you just get a your report, listing your credit history, lines, and balances. Access to your credit score will cost you, but unless you are shopping for a mortgage or insurance, you’ll probably be fine using the free FICO Score Estimator from myFICO.
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FICO scores are everywhere now. You should be able to buy them while pumping gas soon. Sometimes I think there is too much emphasis on credit scores unless you are in the market for a loan or trying to refinance debt, but I guess they are used on a lot of things now. I just can’t see myself paying $15/month just to track my FICO score. But with the FICO Score Estimator from myFICO, you can estimate your FICO score for free, which is really all you need, I think. And it’s from the official FICO guys, Fair Isaac. You will need to answer ten questions about your credit history.

The main thing you can get out of this, besides your approximate score, is what actually affects your score. Let’s dissect the 10 questions:
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I got caught twice this weekend without any cash, and running around searching for an ATM. I use my credit card for just about everything now, and only keep a max of $40 cash on me. I just found out that I can even pay my garbage bill now with a credit card. And last month I started paying my newspaper subscription with credit to save $1 a week on my rate. The only bills I can’t pay with my credit card now are my water bill, electric bill, and rent.

I’m guessing the utilities have a monopoly, so they have no incentive to offer the convenience of paying by credit card, unlike for instance long distance phone companies. But isn’t processing mailed-in checks also expensive? And I’d think there would be more on-time payments with credit card billing. That’s my guess why the garbage company decided to accept Visa/Mastercard (no American Express).
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I get a lot of credit card offers in the mail. I usually just junk them since they aren’t better than my current list of best no fee 0% APR offers, but this one caught my eye. The outside envelope mentioned “0% APR FOR LIFE” (emphasis their’s). I knew there had to be a catch, but I actually opened this one. I guess this is Discover Card’s new thing? Sorry, it looks to be a targeted mailing, so no online application link to the offer.

The terms of my offer are as follows: 0% APR on balance transfers until 2/06. The 0% APR can be extended for the life of the balance if I make two purchases or cash advances each billing period. The balance transfer transaction fee is 3%, with a minimum of $5 and a max of $29. This offer seemed juicy enough to crunch some numbers…
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I thought I was pretty knowledgeable about credit cards and all, but in doing my due diligence for my Discover 0% For Life credit card offer, I learned something new to look out for – two-cycle billing. (Coincidentally, I wake up to the a comment mentioning it). I guess I never heard of this becuase I never carry a balance that isn’t at 0% APR. Also, most credit card companies don’t use it. Two biggies that do are BankOne (now Chase) and Discover. What is two-cycle billing?
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