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The right number of credit cards

Valued Contributor

Re: The right number of credit cards

I will say that there is anecdotal evidence on this site that 3 credit cards will help boost your score to a greater amount than 1 or 2, but it is hard to say what the effects are of having more than 3.  Certainly, part of that boost comes from having more credit available, which is taken into account in FICO scoring.

 

However, you will probably need to explain every inquiry you put on your report within 6 months of mortgage, so be aware of that if you do decide to add a third card.


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Message 11 of 16
Moderator

Re: The right number of credit cards

Some mortgage lenders like to see you have a minimum of 3 or 4 tradelines (positively reporting) in order to issue a mortgage. Naturally you would need to meet the other mortgage criteria including down payment, employment and other credit requirements. The 3 or 4 tradelines is not a written guideline AFAIK, but it is the one that many mortgage lenders use. This would include any installment loans you have (auto/student) as well as cc's.

 

I have seen people increase their scores tremendously here in a short time (6 months to a year). Check out the rebuilding section if you haven't already checked them out.

Message 12 of 16
Valued Contributor

Re: The right number of credit cards


Pghmg wrote:

Can anyone tell me the proper number of credit cards a person should carry to help increase credit score. Someone told me that three is the magic number. I currently have two, one is a cap one master card and the other a orchard Master Card. Both accounts have  300 limits. Can anyone give me direction .


That 560 score in your signature for 11/2012...is that a FICO or FAKO score? 
Appears you've made some strides in what you're doing, going from a 523 to a 560 score in a short time.  What mortgage lenders like to see, rather than just more credit cards, is a good mix of credit.  Credit cards help but so do car or personal loans.  If you have those in your credit history mix, that will be a benefit. 
Shoot for a 660-680 range for your goal of Summer/2013.  I think that could be doable, given whatever you've done to get the increase you currently have.  Just make sure that it's a FICO score and remember that a mortgage lender will pull all three of your reports and take the middle score.  Monitor those scores here, spend the money to get your reports here in, say January/2013 so you know where you are at the beginning of a new year, and then maybe every other month, pull your scores here.  That will give you 2 of the 3 scores you need, so regardless of what Experian may report, you'll have 2 scores to base your progress on. 
 
EX = 849 EQ = 850 TU = 850 as of 07/2017
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Message 13 of 16
Senior Contributor

Re: The right number of credit cards

I have 17 cards LOL. A high num of cards only becomes a problem if you carry a balance on all of them. I only use 5-6 and only carry a balance on like 3, which are at 0%. I use most of my accounts every six months or so just to keep em active and reporting. That is key to help aaoa and util. Even if you dont use an acct much, keep it active and reporting by charging something small every few months.

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Message 14 of 16
Member

Re: The right number of credit cards

560 is my FICO score and currently I have an auto loan and studen loans, so I think I have a good mix. Instead of getting a new card I will work on attempting to increase my limits on the ones that I have, along with continuing to work my program.  All of you guys are great and I will keep updated with my progress.

Starting Score: 523- 9/24/12 FICO
Current Score: 609-4/05/13 FICO
Goal Score: 650


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Message 15 of 16
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Valued Contributor

Re: The right number of credit cards


Pghmg wrote:

560 is my FICO score and currently I have an auto loan and studen loans, so I think I have a good mix. Instead of getting a new card I will work on attempting to increase my limits on the ones that I have, along with continuing to work my program.  All of you guys are great and I will keep updated with my progress.


Best of Luck to you!  This forum here can be a wealth of information, lots of good folks with great answers to questions! 

EX = 849 EQ = 850 TU = 850 as of 07/2017
Retired and Retiring Cards!
Message 16 of 16