New Credit Card

[sdadi9604]

Hello All,

I am in confusion if I have to apply for new credit card or not. I have 3 Credit Cards - 2 Bank Of America - (1 CC with $14000, and another with $12000 = Total $26000) and another Best Buy Citi Credit Card with Limit of $1000. Right now I have a Credit utilization of 40% and 60% credit availability. And I am planning to buy a home in next 1 year. I am pretty much sure that I can pay off the balance by that time and will bring the Utilization below 5%. 

So my question is, Is it good to apply the New Credit Card right now so that my utilization will be low till I apply for Mortgage Loan and I will carry very good Credit Limit which puts an impression on Lenders that I am carrying big credit limit and I am paying of everything on time and my Utilization is low too? 

Right now my score is: EXP: 734 with 4 hard Inquiry,

                                          TU: 698 with 11 Hard Inquiry(Hard Inquiry for Auto Loan becaue lender applied for loan to many banks) &

                                           EQ: 720 with 5 Hard Inqury.

No Collection or late payments till now and the oldest account open in Dec. 2008.

Any suggestions please?

Thanks for your help in Advance!!!

[09Lexie]

Welcome to the forum. Util is 35% of your CS. while applying for additional credit may lower your overall util, if your individual util is high on cc's it will still ding your score. You have more than enough credit and cc's to qualify for a mtg once you get your util much lower.

[Creditaddict]

If you are paying interest I would suggest looking at chase slate because not only is it 0% but it's $0 bt fee for first 60 days so then more of your money will get this paid off but otherwise just pay down the debt and no more inq's will go further with your mortgage approval then having $10k+ spread out over lower util.
Mortgages only care about debt to income based on total payments.... Keyword being your monthly payments total so having $100k credit will not change the amount you have to pay out.
Mortgages plus all other payments usually can't be more than 50% of income.

[sdadi9604]

Thanks 09Lexie for your reply!

So that means I have good number of Credit Cards and good credit limit and there will be a good chances of getting mortgage loan if I lower my Util. Right???

[sdadi9604]

Thanks Creditaddict for reply!

I used my balance transfer option of 3.99% APR to pay of my other Credit Card having the 14% APR. So that I can save almost 10% APR on my $10k balance. I saw few cards like Discover It and Citi some card giving 0% APR on Purchases and Balance Transfers for 14 - 18 months. I thought to apply one of the card so that I can save that 3.99% APR too and I can pay off my cards even faster instead of paying APR. And thought It will be one only 1 Hard Inquiry left when I will apply for Mortgage loan.

What do you say? I may be very wrong about what I am thinking about applying New Card .

[09Lexie]

Yes. You indicate no baddies and assuming your util is much lower. IIRC, dti on conventional loans should be no higher than 36% and VA/FHA loans slightly higher @41%

[Creditaddict]

Citi and discover will be 3% to do the bt so if you are at 3.9 I would not move it unless it was to chase slate with no bt fee and 0% for 15 months
Savings is like $10-15 month so I might just leave it alone and let those inq go away and do your best to cut that debt down by 50-75%

[Kenny]

Slate is the only card I know that has no BT fee when processed in the first 60 days I think it is.. and 0% apr for 15 months, too.

[sdadi9604]

Alright In that case I will not apply any new card. And will wait for Bank of America & Citi card to increase my Credit limit Automatically. 

Thanks a lot for the suggestion.

[sdadi9604]

Thanks all for your time and quick responses. I really appreciate your help and suggestions!