So I’m selling my car and buying one that’s more reliable than my current 2012 Chevy Cruze but worth less money. Looking for the best Mazda 3 or Honda Civic I can find in the $9-10k range. Any recommendations on the car itself?
Anyway, my wife & I are planning to buy a house in the next 1.5-2 years. My credit history is limited to $6k in credit card debt a few years ago (now down to under $1k, will be zero in about 3 months) and a bunch of student loans. So I’m wondering if it would be worthwhile to take out a loan for my new (old) car and pay it off in a month or 2 in the interest of boosting my credit score? Or would it not change my credit score much without carrying a balance for a year or more? Btw, where do you guys suggest checking your credit score?
Taking out a car loan won't do much to help your credit score - and it may hurt it.
Your FICO score is calculated based on various factors, but the most important ones are
1) ratio of available credit to extended credit (about 30%)
2) history of credit repayment (have you ever missed a payment) (about 35%)
3) Length of credit history (about 15%)
4) any new credit (about 10%)
5) Credit mix (about 10%)
1.5-2 years isn't much to move the needle on 2 or 3m and it may be a ding against 1 and 4 if you still have some of the loan when you apply for a mortgage.
The best thing you can do is to continue paying your bills on time every month (helps #1-4). Beyond that, you may want to call your credit card companies and ask if you can have your credit limit extended. This will ding your credit slightly for a few months (#4 new credit) but will ultimately help you because you will have a higher ratio of available credit (#1).
Also check that there isn't anything erroneous on your credit report (it's amazing how often there are mistakes or fraud).
Agree with Mary W that checking your actual credit score is a great first step. If it's over 720 there's no need to change anything - you will qualify for the best loans.