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TwistedAngel
Posts: 58
Registered: ‎04-02-2013
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Confused about advice

Hello all. I saw an article on this site that said not to app for cards you don't need just to increase your number of accounts. I have seen the same advice elsewhere as well, and this confuses me because I don't see it as particularly good advice.

My denial letter said I don't have enough lines of credit. Another credit report site says I don't have enough accounts.

My scores are in a very good place and at the time of apping I had only one card in good standing with no baddies whatsoever, so in my experience scores mean very little unless you have a diverse report to go with it. From reading, I also see that my problem is a fairly common one, at least with people my age.

So why the advice to not have more cards than you "need" when that hurts reports, especially since most people only really "need" one? I certainly don't need more than that, and stupidly thought only having one was a good thing before discovering this site.
    
............11/10.......................03/13........
Valued Contributor
Burned2manybridgesB4
Posts: 2,207
Registered: ‎03-15-2012
0

Re: Confused about advice

On phone/short reply... 3 rebuilding cards max! Don't load up on low limit cards, since you'll close them, and move up anyways. Slow pace wins the race. Lots of low limit can cards don't look good on a CR, IMO.

Super Contributor
enharu
Posts: 7,130
Registered: ‎02-27-2013
0

Re: Confused about advice


TwistedAngel wrote:
Hello all. I saw an article on this site that said not to app for cards you don't need just to increase your number of accounts. I have seen the same advice elsewhere as well, and this confuses me because I don't see it as particularly good advice.

My denial letter said I don't have enough lines of credit. Another credit report site says I don't have enough accounts.

My scores are in a very good place and at the time of apping I had only one card in good standing with no baddies whatsoever, so in my experience scores mean very little unless you have a diverse report to go with it. From reading, I also see that my problem is a fairly common one, at least with people my age.

So why the advice to not have more cards than you "need" when that hurts reports, especially since most people only really "need" one? I certainly don't need more than that, and stupidly thought only having one was a good thing before discovering this site.

this is the dilemma here.

you don't need to get cards you don't need, because you won't use them much, and having to remember the due date for it and to maintain it (such as fees, if any) can be a chore or a burden.

 

however, when banks evaluate customers, the prime banks (or banks that prefer lower risk clientile in general), want you to have more cards where they can evaluate u on. By having more cards history, it gives them a better data sample to evaluate your credit-worthiness and risk.

 

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
FocusedAndDetermined
Posts: 6,418
Registered: ‎01-05-2013
0

Re: Confused about advice

Having little or no credit has always been a problem.  It's similar to gaining employment; employers want people with experience.  But how do you get experience, if no one will hire you?

 

The advice you have read is correct, but in general, it is targeted to those who collect CCs like a fashionista collects shoes.  If you have only one card, getting one or two more would be a good move for you.  If you already have 12 cards, do you really "need" another?  All advice should always be applied with one's present circumstances in mind.  It's advice - not an absolute value.


Frequent Contributor
brother7
Posts: 377
Registered: ‎02-06-2009
0

Re: Confused about advice

Previously, I had 3 cards and only used 1 as my main card. Even with 3 cards, I think I was categorized as having a "thin file".

So I went on an app spree and now have 9 cards.

 

On the bright side, my new main card is a 2%-cash-back-on-everything card.

Looking back, I wish I had not app'd for 1 of the cards. Sounded good at the time but in reality, the other cards I have are better and I'll probably just sock drawer this one.

 

All in all, I'm glad I went on the app spree. My FICO took a 50 point hit due to recent inquiries and a big AAoA hit. As time passes, AAoA will recover, inquiries will fall off, and future creditors can judge my creditworthiness using a not-so-thin-file :smileyhappy:


11/02/2012 Peak - EQ 790 (ScoreWatch EQ FICO)
10/22/2014 Current - EQ 797 (Priceline TU FICO 08 Classic)
GOAL - 800! - App free since 09/07/2014
Member
power1234
Posts: 72
Registered: ‎04-06-2013
0

Re: Confused about advice

Yes the reason for denial is more then correct you are not showing multiple trade history and you are trying to open multiple trades

In my experience I had the  same problem back in the days and I opened 12 more accounts in 6mo

My score went from 707 to 773 in that 6 months time period yes it works yes it does help to have multiple accounts reporting

Yes its going to initially go down 25 points when the accounts will report in credit but after 6 months you will be glad you did

 

Best luck to you

Senior Contributor
youngandcreditwrthy
Posts: 6,242
Registered: ‎08-16-2012
0

Re: Confused about advice

My 20 higher limit cards get me approved 100% of the time for the past...year or two ;-)

Don't listen to whoever told you that.

And a bunch of low limit cards can turn into a bunch of high limit cards; check my sig.

The key is:
Do NOT use all of your credit. Keep util as low as possible.
And don't continuously open acct after acct. gardening is essential!
Marriott PR$25k | BCE $24.5K |BankAmericard Visa $25k| Wmt Discover $12.5k | BR Visa $12.5k | Amex Delta Gold $10k | Discover IT $10k | Paypal Extras MC $15k | Amazon Store $10k|Arrival $12.7k | Smile Gen $7.25k | Dillard's $10k | West Elm $4k| Express $3.05K | Mypoints.com Visa $4.5k | Freedom Visa $1k| Amex Surpass $1k
Senior Contributor
Wolf3
Posts: 3,197
Registered: ‎01-24-2010
0

Re: Confused about advice


TwistedAngel wrote:
Hello all. I saw an article on this site that said not to app for cards you don't need just to increase your number of accounts. I have seen the same advice elsewhere as well, and this confuses me because I don't see it as particularly good advice.

My denial letter said I don't have enough lines of credit. Another credit report site says I don't have enough accounts.

My scores are in a very good place and at the time of apping I had only one card in good standing with no baddies whatsoever, so in my experience scores mean very little unless you have a diverse report to go with it. From reading, I also see that my problem is a fairly common one, at least with people my age.

So why the advice to not have more cards than you "need" when that hurts reports, especially since most people only really "need" one? I certainly don't need more than that, and stupidly thought only having one was a good thing before discovering this site.

FICO score thinks you need 3 cards and deducts for less.   

 

IMO, In addition to your normal card, you should have a 1 backup card  that you don't carry in case your normal card is not usable (loss or theft, overlimit).  I also keep a 2nd backup card at work.  If you are a regular customer, a store card can generate a lot of discounts and rewards. 

 

Beyond 3, getting cards you don't need is not a good idea.

 

 

Senior Contributor
Open123
Posts: 4,194
Registered: ‎02-23-2011
0

Re: Confused about advice

For building and/or rebuilding, I think 3 - 5 cards are optimal, in terms of scoring wise and building/rebuilding at the ideal pace.

 

Under 3 is not a good idea, and too much is also taking on too many responsibilities too soon, which will tend to make future creditors nervous.  Having more cards certainly won't be viewed negatively (as it would a thin and new file) once you've achieved some AAOA, higher limits and proven you can handle charging and paying. Most people who add 10+ cards already have mature and relatively thick files who are opening the accounts for diversified benefits, increase rewards spending and accrue sign up bonuses, none of which should be a concern for someone in building and/or building stage.

 

Follwing the adage of "applying for credit only when you need it" will only result in "never getting credit when you need it."  I can summarize all banks I've ever dealth with the following analogy.  Once it rains, they'll ask for the umbrella they loaned you back; and, you can forget about borrowing a new one until it get Sunny again.

Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012
0

Re: Confused about advice

I got really lucky yesterday getting credit when I desperately needed it but the key is not to show that desperation on your credit report. I was approved for the Discover IT with 39% utilization. I needed credit but it didn't look like it because two of my cards are everyday cards that I PIF every month. If you apply all maxed out, that leads to a dead end.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014

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