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How much will score go up/down with new card but reduced debt ratio

Valued Member

How much will score go up/down with new card but reduced debt ratio

Started with 40% debt ratio on revolving accounts (32500/13000)  Got a new CC yesterday with $15,000 CL.
 
After payments this month and new card, my new debt ratio will be about 19% (47500/9100).
 
Will the reduction in ratio offset the hit I will take on new card?
 
BTW - EQ inadvertantly removed my new card inquiry when it took a cable company inquiry that I disputed yesterday, so no new inquiries and now it is 0 inquiries.
 
 
04/01/08 EQ 622 EX 630 TU 598
09/88/14 EQ 754 EX 749 TU 741
Message 1 of 6
5 REPLIES
Moderator Emeritus

Re: How much will score go up/down with new card but reduced debt ratio



NC_Sue wrote:
Started with 40% debt ratio on revolving accounts (32500/13000)  Got a new CC yesterday with $15,000 CL.
 
After payments this month and new card, my new debt ratio will be about 19% (47500/9100).
 
Will the reduction in ratio offset the hit I will take on new card?
 
BTW - EQ inadvertantly removed my new card inquiry when it took a cable company inquiry that I disputed yesterday, so no new inquiries and now it is 0 inquiries.


Can't really say whether the lower utilization will offset the effect of the new account without knowing what the effect of the new account will be.
 
What is your average age of accounts, how many total open accounts do you have, how many of those are revolving, and how many of your accounts have balances?

 
----------------------------
App free since 7/11/08.
TU 744 / EX 710 / EQ 694 (Starting to slip. Smiley Surprised )
Message 2 of 6
Valued Member

Re: How much will score go up/down with new card but reduced debt ratio

Thanks for the help.   Here is what I have:
Auto Loan - 09/2006, orig 22,266, bal $17,377        
Oldest Closed account - 06/1997
 
Mortgage $168,000 - PIF 03/2008
 
The rest are revolving (including my Amex Green which reports as a revolving with 0 CL):
 
10 Open -  06/15/2008
Card            Age          CL        Bal           Ratio
Amex             07/02          0         3,406
BoA                01/04        2,500            0                0%
CareCredit    06/02        5,800       4,556            79%
Dell             09/02        3,500             0                 0%
Discover        09/02         6,700            0                0%
Sears             05/02          500              54           11%
HomeDepot  11/01        7,000            0                 0%
WaMu Visa  12/03        2,000        779            39%
WFNB            02/03          0             0                        (inactive, but shows as open)
Aspire             04/00     4,500      4,222            94%
                             $32,500    $13,017          40%
 
11 Open -  07/01/2008
Card            Age           CL         Bal           Ratio
Amex            07/02            0               0
BoA            01/04        2,500        0             0%
CareCredit    06/02        5,800      4,200           72%
Dell              09/02       3,500          0                0%
Discover         09/02     6,700      2,150          32%
Sears              05/02         500          0           0%
HomeDepot  11/01      7,000         0               0%
WaMu Visa  12/03      2,000         0               0%
WFNB            02/03         0                 0
PenFed Visa 06/08      15,000         0            0%
Aspire              04/00        4,500     2,550          57%
                              $47,500   $9,000         19%
04/01/08 EQ 622 EX 630 TU 598
09/88/14 EQ 754 EX 749 TU 741
Message 3 of 6
Moderator Emeritus

Re: How much will score go up/down with new card but reduced debt ratio

OK, not counting your mortgage, since you didn't mention when it was opened, your average age of accounts before the new card was 5 years and 3 months.  After the new card it is 4 years and 10 months.
 
I think the improved utilization will help much more than the loss of 5 months in average age will hurt.  Just my opinion, but I think it's a good move.
 
----------------------------
App free since 7/11/08.
TU 744 / EX 710 / EQ 694 (Starting to slip. Smiley Surprised )
Message 4 of 6
Valued Member

Re: How much will score go up/down with new card but reduced debt ratio

thanks.   I was thinking along those lines too.   I already get a reference to age of accounts from CRAs on score analysis, but biggest ding was ratio.   I will rescore once the new card shows on reports.
04/01/08 EQ 622 EX 630 TU 598
09/88/14 EQ 754 EX 749 TU 741
Message 5 of 6
Frequent Contributor

Re: How much will score go up/down with new card but reduced debt ratio

sue, do you have scorewatch and the fico simulator ? Try punching in the numbers and see.
God is keeping score....be good to others.
Message 6 of 6