Gerri Willis Commentary:
Top Tips by Gerri Willis Column archive

Credit score do's and don'ts

Plus: Borrowing from retirement accounts for a downpayment and how to speed up student loan repayments.

By Gerri Willis, CNN

NEW YORK ( -- Question: Where can I find an inclusive list of items (do's & don'ts) that affect my FICO score? - Anita

Go to Click on "Learn" at the top of the page and then scroll down to "how to improve your score." There you can get tips on what you should and shouldn't do to boost your score, like when to open or close credit-card accounts.

You can also use a simulator on the Web site that will tell you how many points you stand to lose or gain in certain circumstances. The'll have to buy a credit report from the site.

Question: Could you give me some tips on how to pay off Sallie Mae loans quickly? - Jacqueline

There is no prepayment penalty with student loans. So if you have some extra cash, it'll be worth your while to put some extra cash toward those monthly payments. Make sure that you include a letter with your prepayment saying that you want the extra money to go toward the principal, and that you're not just paying off next months' loan.

A general rule of thumb is to pay off the loans that have the highest interest rate. Generally it's a good idea to pay off your private student loans first because they're usually more expensive than federal loans, according to Mark Kantrowitz of

Question: I am in the market and looking to buy a house. Can you share your thoughts on using 401(k)/IRA resources toward home buying? - First Time home buyer

Don't touch your 401(k). Here are three good reasons:

Most importantly, you'll be robbing yourself of growth in your retirement. Second, when you repay the loan you'll pay it back with after tax dollars. Third, if you lose your job, you'll have to repay that money back in full, or you will be paying a 10% penalty, plus taxes on what you take out if you're younger than 59 and a half years old.

It's also not a good idea to withdraw your Roth IRA. That's because you can only take out your contribution up to $10,000. And once you take that money out, you can never put it back in. You can only put up to $4,000 per year, says Greg McBride of

But here's a third option - why not just save up? You don't have to jump on the bandwagon now. In this kind of housing market, borrowers can take 6 months to a year to get their finances in order. Prices won't run away from you. It's really a great time to save money for that down payment.

Question: When I donate to places like the Salvation Army they don't have a value amount. So how do I use this for my taxes? - Wesley

If it's not a cash donation, you should get a receipt. And if you don't, it's within your right to ask. But basically it's a good faith estimate. There are some rules though. Your donation has to be worth something and has to be in usable condition. Consider how much you paid for the items in the first place and then account for wear and tear.


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Gerri's Mailbox: Got questions about your money? We want to hear them! Send e-mails to or click here - each week, we'll answer questions on CNN, Headline News and  Top of page

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