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Valued Contributor
SnackTrader
Posts: 1,563
Registered: ‎09-15-2012

Re: Chase Pre-Approval...Need Advice!

More than 1 account reporting a balance will lower FICO score, all else being equal (note reporting a balance is much different than carrying a balance). So, if you want to maximize your score, you should have all cards report a $0 balance, except for one card. That card should report a balance between 1-9% of its total balance. The ideal percentage is likely different for each individual.

Your second question is a bit complicated. But the way you phrased it - you would pay $0 interest. Most lenders do not have retroactive interest on their bank cards, so carrying a balance during the introductory period and beyond will only begin accruing interest after the 0% interest period is up. BUT - you should always read the conditions of an individual account to figure that out. Store cards usually WILL charge retroactive interest.

In your example, you said that a card is "showing" a $500 balance. Having a balance report, as I mentioned before, is much different than leaving the balance unpaid after the grace period. If the $500 balance was left after the grace period in the 13th month then you would pay interest on only $500.

The reason I mentioned this to the OP is I generally recommend NEVER paying interest if you can help it. And people often charge more than they can pay back during a 0% introductory period due to the comfort of 0%. That's why banks offer it. It is very strategic, but as consumers we need to try to be smart about using 0% and similar offers to our advantage and not our detriment.

In My Wallet: Amex BCP (12/12) $22.200, Chase CSP (4/14) $12,000, Barclaycard Arrival (5/13) $10,500, Citi Forward (12/12) $9,600, Cap1 Cash Rewards (6/12) $9,000, Chase Freedom (12/12) $5,000

Last App: April 2, 2014
Super Contributor
enharu
Posts: 6,889
Registered: ‎02-27-2013

Re: Chase Pre-Approval...Need Advice!

[ Edited ]

what is the difference between reporting and carrying a balance?

 

Chase reported to the CRAs I still had a $20 balance (I paid the card in full, but swiped another $20 worth, so $20 is owed on current cycle). 

Wells Fargo is gonna report a balance as well unless i absolutely not use it a few days before and until my statement cycle ends.

the total util is still below 9% for each card, and also below 9% for overall util. 

do u know how much my fico score will be lowered by?

 

So the best way to do things is to pay the cards in full, and absolutely not use it a few days before statement cycle ends just so it reports $0 balance?

 

do banks card, or does it show on the credit report that balances are paid recently or it's been paid for a long time?

i usually pay my cards in full, but i continue swiping, paying, and swiping so sometimes it shows a very high balance (at one point $7950+ owed on 8000 CL) so that got my ultilization almost to the max.

 

Thank you so much for your posts. I am learning so much!

JPMorgan Palladium (100k), AmEx Platinum (NPSL), AmEx SPG (46k), AmEx BCP (42k), Chase Sapphire Preferred (47k), Citi Prestige (31k), Citi Thank You Preferred (27k), Citi Executive AAdvantage (25k), JPMorgan Ritz-Carlton (21k), Merrill+ (15k), US Bank Cash+ (22.5k), Wells Fargo (12k), Bloomingdale’s (12.4k), Chase Freedom (5k), Discover IT (5k).
Valued Contributor
SnackTrader
Posts: 1,563
Registered: ‎09-15-2012

Re: Chase Pre-Approval...Need Advice!

What you just mentioned with Chase and the $7950 is the example of reporting a balance. You only need to maximize utilization when you are preparing for new applications. I do the same thing as you and keep swiping and paying as I go in every month except those in which I am applying for new credit.

Carrying a balance is when you don't pay by your grace period an are charged interest. It doesn't sound like you do that, so no worries there.

There is no way to say how much a FICO will change. That differs significantly between individuals based on what else is on their reports.

Every credit report shows how much was paid in the previous month, but each creditor usually only reports the last payment that was made in my experience. So if you make a $5,000 payment on the 12th, and a $25 payment on the 14th and your statement closes on the 16th, it will usually report just $25 payment. That usually doesn't matter a whole lot, in my opinion sice it doesn't represent a very large sample for lenders to make determinations off of. But if a lender was to actively monitor your report, I suppose they could compile this info and make a conjecture about your spending habits on other cards.

In My Wallet: Amex BCP (12/12) $22.200, Chase CSP (4/14) $12,000, Barclaycard Arrival (5/13) $10,500, Citi Forward (12/12) $9,600, Cap1 Cash Rewards (6/12) $9,000, Chase Freedom (12/12) $5,000

Last App: April 2, 2014
Super Contributor
enharu
Posts: 6,889
Registered: ‎02-27-2013

Re: Chase Pre-Approval...Need Advice!

so basically the banks most likely won't deny a credit app just because someone paid down their balance "too quickly" right before applying for a new credit right?

 

i have a late payment from July 2006 (30-day late). this should fall off July 2013, right? should i hold off applying all credit until this falls off?

 

How many past months inquiries are factored in by banks when applying for credit? I know inquiries affect fico scores for only 12 months, but do banks only look at inquiries during past 12 months, or do they look at the full 24 months?

 

Is 8 inquiries on just 1 bureau (experian) for the past 24 months a tad too execessive? 5 are due to an auto loan app which were all inquired between 2/5 to 2/7 in 2013.

the other 2 inquiries fall off july/august 2013. should i wait for it to fall off then apply, or it shouldn't hurt me as much? 

 

Thank you so much. U have been tremendous help!!!!

JPMorgan Palladium (100k), AmEx Platinum (NPSL), AmEx SPG (46k), AmEx BCP (42k), Chase Sapphire Preferred (47k), Citi Prestige (31k), Citi Thank You Preferred (27k), Citi Executive AAdvantage (25k), JPMorgan Ritz-Carlton (21k), Merrill+ (15k), US Bank Cash+ (22.5k), Wells Fargo (12k), Bloomingdale’s (12.4k), Chase Freedom (5k), Discover IT (5k).
Regular Contributor
jakemod1
Posts: 173
Registered: ‎01-26-2013

Re: Chase Pre-Approval...Need Advice!


SnackTrader wrote:
Creditcards.com doesn't offer pre-selected offers the way that lenders do with pre-screened tools. In fact, you don't even need to enter accurate information to get back results on creditcards.com. They just want to get everyone to apply through their site because they get revenue for doing so. Do not rely on their offers, IMHO.

You're in a dangerous spot, OP. Your utilization right now is probably not much better than when your Discover reports just due to the multiple cards reporting a balance factor. However, then you have to ask yourself if there is anything else on your report potentially holding you back. I think this is going to be a personal decision, but honestly I would apply before taking a new account hit - especially if that new account will be reporting 45% util. That just seems like a red flag to me.

Which leads me to just cautioning you on 0% interest. It's great now, but please make sure you have the cash to pay it off. New accounts can often lead to new debt that isn't often warranted.

Wishing you good luck with whatever you decide.

I plan to pay it off within the next few months. I always pay on time and more than the minimum. I even make multiple payments in a month.

 

Before coming here recently, I had no idea that my util was even affecting my score. I never worried about the card reporting a balance since I didn't know any better. I just figured that as long as I was making on time payments, I'll be good to go. I was actually wanting to see what other people thought about the Discover IT card when I got it (I tend to research anything new that comes my way), and it led me to this site, which in turn, opened my eyes up on ways you can maximize your credit score.

 

That's why I am surprised that Discover even sent me pre-approvals knowing what I know now. I had a couple cards reporting 90%+ util and all but two were reporting a balance when they approved me for $6,000. I guess it was a YMMV, but I can't help but wonder.

 

In any case, with the knowledge I acquired, I paid off all my previous credit cards and will pay off Discover in the next 4 to 6 months.

 

Thank you for your advice!

Discover IT: $7,500 | Chase Freedom: $5,000 | Chase Sapphire Preferred: $7,000 | AMEX BCE: $6,000 | BoA BankAmericard Cash Rewards: $2,500 | Cap1 VentureOne: $5,000 | GECRB Chevron: $3,500 | Macy's Store: $4,200; Macy's AMEX: $6,000 | Best Buy: $500 | Kohl's: $2,000
TU FICO: 746 (myFICO 7/28/13)
EQ FICO: 767 (myFICO 2/28/13)
EX FICO: 742 (myFICO 8/8/13)
App Free as of 8/8/13
Regular Contributor
jakemod1
Posts: 173
Registered: ‎01-26-2013

Re: Chase Pre-Approval...Need Advice!


SnackTrader wrote:
Forgot to mention your other option - wait 6 months. Do you really need new credit, or just want it? As long as you make on-time payments and keep the util within control there is no reason your score and overall profile won't be even better at that point in time.

I don't really need new credit, I just want it. I also just recently started getting into the cashback bandwagon. I only had the not-so-great WorldPoints through BoA. I wasn't even getting the full value of my points. I PC'd it to their Cash Rewards since then.

 

I'll probably wait until I get my util on my Discover down to at least below 20%. Like most here, I am just itching to app. Thanks to my recent approval, I caught the app bug.

Discover IT: $7,500 | Chase Freedom: $5,000 | Chase Sapphire Preferred: $7,000 | AMEX BCE: $6,000 | BoA BankAmericard Cash Rewards: $2,500 | Cap1 VentureOne: $5,000 | GECRB Chevron: $3,500 | Macy's Store: $4,200; Macy's AMEX: $6,000 | Best Buy: $500 | Kohl's: $2,000
TU FICO: 746 (myFICO 7/28/13)
EQ FICO: 767 (myFICO 2/28/13)
EX FICO: 742 (myFICO 8/8/13)
App Free as of 8/8/13
Regular Contributor
jakemod1
Posts: 173
Registered: ‎01-26-2013

Re: Chase Pre-Approval...Need Advice!

I just checked my Experian Equivelancy Score: 769. I know its a FAKO score, but it can't be that far off from my actual FICO score, right?

 

I think I'm amping myself too much.

Discover IT: $7,500 | Chase Freedom: $5,000 | Chase Sapphire Preferred: $7,000 | AMEX BCE: $6,000 | BoA BankAmericard Cash Rewards: $2,500 | Cap1 VentureOne: $5,000 | GECRB Chevron: $3,500 | Macy's Store: $4,200; Macy's AMEX: $6,000 | Best Buy: $500 | Kohl's: $2,000
TU FICO: 746 (myFICO 7/28/13)
EQ FICO: 767 (myFICO 2/28/13)
EX FICO: 742 (myFICO 8/8/13)
App Free as of 8/8/13
Super Contributor
enharu
Posts: 6,889
Registered: ‎02-27-2013

Re: Chase Pre-Approval...Need Advice!

Yea I think so too lol. The freedom isn't that hard to get. I would say any score above 700 has a pretty good chance of getting approved.

JPMorgan Palladium (100k), AmEx Platinum (NPSL), AmEx SPG (46k), AmEx BCP (42k), Chase Sapphire Preferred (47k), Citi Prestige (31k), Citi Thank You Preferred (27k), Citi Executive AAdvantage (25k), JPMorgan Ritz-Carlton (21k), Merrill+ (15k), US Bank Cash+ (22.5k), Wells Fargo (12k), Bloomingdale’s (12.4k), Chase Freedom (5k), Discover IT (5k).
Regular Contributor
jakemod1
Posts: 173
Registered: ‎01-26-2013

Re: Chase Pre-Approval...Need Advice!

I couldn't resist any longer!!! So I app'ed for the Chase Freedom and......

 

 

APPROVED!!!

 

It was instant approval! I called to check my limit and it was $3,000. I wanted to really make it worthwhile (higher limit I was thinking), so I called and the CSR transferred me to their Lending Specialist. After aboout a five minute interview, they granted my request of $5,000! I am so happy right now! I'm having uncontrollable spasms! lol :smileyvery-happy:

Discover IT: $7,500 | Chase Freedom: $5,000 | Chase Sapphire Preferred: $7,000 | AMEX BCE: $6,000 | BoA BankAmericard Cash Rewards: $2,500 | Cap1 VentureOne: $5,000 | GECRB Chevron: $3,500 | Macy's Store: $4,200; Macy's AMEX: $6,000 | Best Buy: $500 | Kohl's: $2,000
TU FICO: 746 (myFICO 7/28/13)
EQ FICO: 767 (myFICO 2/28/13)
EX FICO: 742 (myFICO 8/8/13)
App Free as of 8/8/13
Community Leader
Senior Contributor
myjourney
Posts: 25,241
Registered: ‎02-07-2013

Re: Chase Pre-Approval...Need Advice!


jakemod1 wrote:

I couldn't resist any longer!!! So I app'ed for the Chase Freedom and......

 

 

APPROVED!!!

 

It was instant approval! I called to check my limit and it was $3,000. I wanted to really make it worthwhile (higher limit I was thinking), so I called and the CSR transferred me to their Lending Specialist. After aboout a five minute interview, they granted my request of $5,000! I am so happy right now! I'm having uncontrollable spasms! lol :smileyvery-happy:


Congrats great card 

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