Mired in confusion

[Anonymous]

A set of questions for those who have greater expertise than I: My goal is to obtain a new card, with a high CL, to which I can transfer balances.

Background:

I have $34,000 in combined card balances against combined CLs of $55,000. The balances are on a chase card with $25K (CL: $30K) and an HSBC card at $9K (CL: $15K). I have 3 other cards with no balances, with CLs from $3-8K. I have no negatives on my report, other than high util., except that I got a new card recently -- end of 2005. My scores are 755 to 770. My personal income is $98,000. Household is $155,000.

The reason I need new card(s) is that both Chase and HSBC radically increased my interest rates (and HSBC lowered my CL), despite no late payments, on the grounds that my credit standing had deteriorated. My scores had dropped a lot because of nearly maxing out my cards. I have since paid a large chunk, raising my scores back up -- but I am not confident they will now agree to lower the rates.

One other wrinkle: I had problems in the early 90s, resulting in a card being closed and another being charged off. The charged off account is no longer on my report. The closed account is, but I leave it on because it is by far my oldest account -- and the fact that the bank closed it doesn't appear to hurt my scores much.

So here are my several questions (any help anyone can provide would be appreciated).

1) How difficult will it be for me to obtain a new card with a high balance (preferably at least $20,000)?

2) Is there any particular approach anyone would recommend? For example, applying simultaneously for two cards as opposed to trying to get one card with a very high balance? Any tips anyone can offer?

3) Does requesting a balance transfer when I apply for a card help or hurt my chances of approval and of getting a high limit -- or does it not matter?

4) If I ask my existing banks for lower rates, will they pull hard inquiries?

5) When I apply for new cards, how quickly will the inquiries show up on my report and affect my score?

6) Should I refrain from seeking a card from a bank where I already have a card (e.g. Chase, BOA)?

7) Will I have a problem seeking credit from the bank where I had the charge off seventeen years ago, and the card is long gone from my credit report? How about the bank that closed the card from seventeen years ago that is still on my report?

8) Finally, does anyone have a sense of whether the sub-prime mess is beginning to affect the approval policies of card issuers?

Thanks for your help.

[Anonymous]

Have you requested an interest rate reduction since your scores have improved and your utilization got lower?

Even with your scores you may have a hard time opening new cards with the limits you need due to high utilization.  I have seen lots of declines with the reason sited as balance on current cards too high.  And those cam at kindergarten credit limits not the higher education ones you have now.

Your scores indicate excellent credit.  There is a find a card option on this site and it lists the current promo BT offers for each card.  You may want to look into those. Since you carry a balance, the Discover Motiva may also be a good option with a 24mos 5.99% BT option.

[Anonymous]

Thanks for your thoughts.

I have not requested rate reductions. I've been waiting to maximize my score before doing so. My plan was to do that first, and then, depending on the results, apply for new cards. Will those requests for reduced rates generate hard inquiries?

So you think that having high utilization/balances may be a killer *regardless* of credit score? I thought the credit score was designed to encompass all factors, such that issuers could rely on the score without reviewing the specifics of a credit report. Do you have a suggestion as to what level utilization would have to be brought down to solve the problem?

[Anonymous]

Lenders will generally creep rates up on you for consistent high utilization. Or for making min payments, or for no reduction in amount owed, like if our balance is constantly increasing.  Saying that, if the reason was a usage reason, they may be able to lower apr upon request.