How much gain can a new card give you? (in terms of credit score)

[Anonymous]

Hello!  I am new to credit rebuilding and got an auto loan in march which I have been diligently paying early payments on.  My score has increased from a 470 to a 577 in just 8 months.  I am really trying to get over the 600 hump.  Last week I got approved for a Capital One card with a $300 limit but it has 0% interest and I wanted to get it to help boost my score.  If I use the card responsibly and continue to make early payments on my car, could I expect to reach the 600 mark within a few months?

Basically I want to know if anyone has had experience in how much your credit score goes up when you get a new credit card and use it properly.

I know it takes a long time to build up your credit score, but I was hoping that getting this card could help me expedite the process.

[Anonymous]

When I was in a similar situation to yours, I saw a score bump on Equifax of about 37 points. To give you some context to my specific situation: I had a bankruptcy, didn't do anything credit related till four years later, got an auto loan and a few months later got a Capital One credit card with a $300 limit.

Obviously your experience will be different but I would guess that you'll see anywhere between a 12-40 point increase for opening a new trade-line and having low/zero utilization on it.

[Anonymous]

Thank you!  Do you recommend just charging a small amount and paying it off immediately?

[Anonymous]

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@Anonymous wrote:

Thank you!  Do you recommend just charging a small amount and paying it off immediately?

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You don't have to worry about paying it off immediately so long as your payments are on time and before the due date.  That said, you can avoid interest charges if you pay before the statement cuts.  Since your card has a 0% intro APR, that probably won't matter for a few months for you.

Since you're in the process of rebuilding, I would recommend keeping your balance at $30 or less by the time the statement cuts. Don't let it go above $200 - and if you do, pay it down to at least $30 by the time the statement is cut. You should see a decent credit line increase in 4-6 months by following that strategy. 

[tim1017]

Hi, I was in almost the exact same position you are about a year ago.  Last month I requested a Credit Limit Increase (CLI or Luv Button as others call it) and received a $2000 increase (from $300) this was almost exactly a year later.  I carried a small balance on it from month to month but paid on time.  They just want to see steady on time payments.  I could have probably asked for an increase sooner but didn't feel like my scores were high enough.  I just recently surpassed the 600 mark after being down just over 500 so there is definitley light at the end of the tunnel.