One more credit card or hold fast with what I have?

[Anonymous]

Howdy all, new to myFICO and been browsing the forums the past couple of days.  Here's my question- should I keep what I have or get one more card? The goal is to close a secured credit card and maintain an excellent FICO score. I have been using it to rebuild my credit history along with a car loan.  All the work has finally paid off and I'm a much better credit citizen this year.  Existing CL's have been raised and I've been issued a new card. Here's the information that I hope helps answer the question, please ask if you need more.

Equifax FICO- 772

TransUnion FICO- 734 (TransUnion only reports 6 years of credit history, not the 19 years Equifax does.  Not sure what to do about that.)

No delinquencies of any kind on either credit report.  They were all paid off long ago and time has gone by.  I've been making all payments on time.

Secured VISA: US Bank $2000CL Current balance ~$1700 Account about 5 years old

VISA Platinum: US Bank $6000CL Current balance ~$1600 Account about 3 months old, new card

MC Platinum: Capital One $4000CL (it was $500 up until about 5 months ago.  I called and asked for limit raise) Current balance $0 Account about 4 years old

Line of credit: US Bank (overdraft protection for checking, reported as revolving credit) $5000CL Current balance $0 Account about 10 months old

Auto loan: Chase Auto Finance loan amount = $8500 Current balance ~$3100 Account about 3 years old

I would like to close out my secured card.  I'm just not sure if I should open a third up to help with credit to debt ratio and have an alternative available in case of any number of reasons I've read listed on this forum.  A friend who works for the bank suggested getting a new card through a credit union to help round out the stable.  As an ex Active Duty member I think I may qualify for the ones mentioned on this board such as PenFed and NFCU.  I did have a credit card through USAA in about 2001 or 2002 but that ended badly.  They were paid off long ago and the delinquency has been cleared from my credit reports.  I'm not sure if I sure try and rekindle a new card there.  My name still does exist in the system, I checked.  Anyways, all the debt I owe is listed above.  Any help or guidance would sure be appreciated.  Thanks!

Edit: Forgot to add I charge up about $1000/month in groceries, gas, utlities, etc. on average.

Message Edited by Honorary_Member on 08-17-2009 10:59 PM

[Anonymous]

Congrats on the rebuilding progress.

Couple of comments.  You mention your EQ and TU credit reports and scores. Since you discuss problems in the past, you may want to check your EX credit report.  Although the scores are FAKO, you should be aware of info contained in the report and any possible negative accounts.

It appears you are U.S. Bank heavy.  Good major bank (I have their Platinum Rewards).  However, it would be a good idea to diversity with a CU.

If you qualify for membership, NFCU gets high marks in the forum  PenFed, Alliant, and Addison have also been well received.  With your scores, you should get a decent CL and establish the groundwork for a long relationship.  Good luck and good work.

[Anonymous]

Thanks for the suggestions.  I did already check Experian through the annual free credit report. I pulled all 3 but Transunion crashed during the process which is why I ended up paying to have it pulled through myFICO along with Equifax.  No negative reports.  An old collections does show up on there but it shows paid off and closed back in 2003.  Also Experian shows 19 years of credit history as well unlike TransUnion.  I have not paid to get the Experian score. 

[Peach8321]

Hi there,

Sounds like you've put a lot of work into the credit process so kudos to you.

I would suggest paying down the balance on the secured card to $0, let it report as $0 for one month, then apply for a NCFU card and AFTER you get that card, then cancel the secure card.  That way, you won't have to wait for points to go back up from closing the secured card (and you won't have a balance on it when it reports).  Plus, you'll have a better score because your DTI will be lower and only one revolving account will be reporting a balance (also, if possible, lower the card with the balance to $1,500 or 25% UTI).

If your finances won't allow you to pay off the secured card, at least get both cards with a balance below 25% UTI and then apply for a new card after it's reported for at least one cycle.

good luck!

[cobaltnv]

You could certainly due with one-three new cards. I am a fan of having 5 cards (although I currently have 7). Five provides some support should one or two cards flake out on you. It also allows you to have 2 cards reporting a balance. With 3 cards really only 1 should report. With your scores I would look for a really good rewards card that you will use and go for it. 

Anyway, a CU would certainly be a good option. I would also recommend looking at getting a Amex or discover card. 

[Anonymous]

I'd like to thank everyone for taking the time to stop by and post their advice.  I decided to go ahead and apply with NFCU.  I was only going to do one, maybe two apps, so I thought I'd better make it count.  They instantly approved a platinum Visa for a CL of $20,000 at 7.9% interest.  Good gosh.  That should get me through for a while! :-)  I guess the 4 years of a secured card and a regular card with only a $500 limit finally paid off. This year I've gone from $2500 in available credit card credit to $30000.  So hang in there, you can turn things around.

[creditwherecreditisdue]

An instant approval from NFCU is a very nice thing! Way to go!

The nice thing about having a higher reporting CL is that you will find your future CL's on new CC's will be higher. Just maintain you high achiever FICO score and you'll be fine.

[cobaltnv]

Congrats!

[plasticman]

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@Anonymous wrote:
I'd like to thank everyone for taking the time to stop by and post their advice.  I decided to go ahead and apply with NFCU.  I was only going to do one, maybe two apps, so I thought I'd better make it count.  They instantly approved a platinum Visa for a CL of $20,000 at 7.9% interest.  Good gosh.  That should get me through for a while! :-)  I guess the 4 years of a secured card and a regular card with only a $500 limit finally paid off. This year I've gone from $2500 in available credit card credit to $30000.  So hang in there, you can turn things around.

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Congratulations!

What is especially impressive is the instant approval.

[Anonymous]

Thanks plasticman.  All I can guess is it's based on a decent salary and being a good credit citizen for the last 4-5 years.