The CARD Act, scheduled to go into effect on February 22 could have a significant impact on first time home buyers in Temecula, Murrieta and other parts of Southwest Riverside and San Diego County.
Maintaining your credit score is critical if you are a first time homebuyer and slight changes by your credit card company could affect your credit score even if you always pay on time OR in some cases if you don't even use the card.
10 Credit Myths that can affect your credit score
The banks in an attempt to get around the requirements of the CARD Act have come up with some sneaky ways to evade the restrictions of the new law.
One of the most blatant tactics is switching everybody to variable rates linked to an index like the prime rate.
Doing so allows to banks to change your rate without advance notice.
What’s more, the variable rate applies to your old balance, which the CARD Act forbids for fixed rates.
These tactics put first time homebuyers between the proverbial "rock and the hard place". You can elect to keep the card and be at the mercy of an arbitrary rate change or you can opt-out of the card, close the account and risk a possible drop in your credit score.
It's time to go back and re-examine those notices sent by your credit card company and make sure whatever changes they are proposing to your card don't impact your credit score and damage your chances of owning your first home.
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