Costa Mesa residents who will be buying a home, refinancing their mortgage, or even just financing a car anytime soon, should think twice before making abrupt credit moves. Even some actions intended to reflect positively on their creditworthiness can backfire.

As everyone learns, your individual credit score determines not just whether financial institutions will grant your application for a home or auto loan—they also play a decisive role in the interest rate you will be quoted. Your score is calculated by using various historical data to determine the degree of risk the proposed loan would subject the lender to—an arithmetic calculation projecting the likelihood that repayment will proceed on schedule. As you can imagine, millions upon millions of recorded transactions tell the tale, giving the scoring companies plenty of data to make their projections pretty dependable.

Costa Mesa consumers aren't privy to the formulas that are used, but can still observe some less-than-obvious actions to take (and not take) in order to maximize their credit scores and their power as credit customers. One of them is simply to act with caution.

Whenever you are seized with the urge to pare down your complicated financial life, go carefully. Especially when your billfold begins to bulge with plastic, or your mailbox and email box keep getting clogged up with too many credit card company statements, the rule is usually, do nothing.

There are three solid reasons why closing down little-used accounts can be counterproductive:
          1. You shorten the combined length of your 'open credit' record. The oldest accounts are the most valuable for demonstrating that you are a veteran credit user instead of a Johnny Come Lately.
          2. You bring down the total credit available to you. The higher that total, the more creditworthy you show yourself to be. Closing an account brings down the total.
          3. Likewise, the percentage that you owe of the credit available to you goes up when you close down an account—even though you haven't borrowed a penny more.

The ins and outs of adeptly navigating the credit system are the opposite of credit itself: it's like money in the bank! When you apply for a home loan, that becomes apparent—even when mortgage interest rates are as low as they are now. Feel free to call us for help and advice whenever Costa Mesa real estate matters are in the offing!

We are built on a philosophy of Heritage & Hustle. The L3 is a full service real estate agency with a regional office located in the heart of #CostaMesa, offering a wide-array of custom services to meet their clients’ needs with roots in the community since 1976.  It’s L3 mission is to provide trusted, convenient, responsive service to ensure clients enjoy their real estate experience. The L3 was originally formed to offer personal, concierge-level service as an alternative to the large, nationally based real estate companies. From its small beginnings of only two employees, The L3 has grown to a full staff of 25 serving over 300 clients a year. The L3 is not limited to serving just its clients; it is also committed to serving the community. Not only has The L3 donated hundreds of hours to many area charities, they have also received the prestige of being named one of the #toprealestatecompaniesinCostaMesa  If you’re interested in #buyingorsellinginOrangeCounty, turn to the experts. Turn to The L3 and let them help you make your real estate buying or selling dreams come true. For more information or to get started on finding or selling your home contact The L3 today at 714-444-4663 or email us at



Posted by Matt Kanoudi on
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