Two credit card questions

[Anonymous]

1)  Does requesting a credit line increase affect my credit score?

2)  I've been spreading my monthly spending among 3 credit cards because I thought having one that wasn't used is bad, when I just pulled my FICO scores they were very good (Transunion and Equifax were both 797), however Transunion said that having 3 credit card balances was hurting my score even though I pay them off each month?!?  Would it be better to spread all my purchases among two cards and just leave the third one open but unused?  This seems odd to me, but credit scores are odd to begin with apparently.

Thanks!

[Anonymous]

It seems that most members seem to report their highest scores when less than half of their cards report a balance. In your case with three optimally you would only want 1 reporting a balance. YMMV as I have not experimented personally with this. Once I get my score to a respectable range I will focus on tweaking.

[haulingthescoreup]

Many banks pull a hard inquiry when the customer calls in to ask for a CLI. Many don't.

If they pull a hard, it can hurt your score maybe 3-5 points for the new inquiry. Might be more if you're in the elite group of ancient history + no baddies.

The important thing to think about before requesting a CLi is how your credit reports look. Do you have more balances than usual posting? What's your util look like? Do you have a bunch of inquiries, possibly indicating a desperate search for new credit?

Unless there's some overwhelming reason, don't attract the attention of lenders if you can avoid it. Think of the giant red eye in Mordor in Lord of the Rings. Most of the time, you really don't want it looking at you.   <-- neither giant nor red!

[Anonymous]

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@Anonymous wrote:

(Transunion and Equifax were both 797), however Transunion said that having 3 credit card balances was hurting my score even though I pay them off each month?!?  Would it be better to spread all my purchases among two cards and just leave the third one open but unused?  This seems odd to me, but credit scores are odd to begin with apparently.

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Equifax slowly punishes the FICO if you have stagnant accounts.   After six months it warns you (with a red block on the "scale")  that there's been "limited activity" on some of your cards.  The score decreases will be slow and steady and will jump back up once you show activity again.  This happened to me with a citi MC which I didn't use for several months and I was wondering why I was losing anywhere from 3 to 7 points a month on scorewatch with no inquiries and no increases in util.

However, my experience was with only 2 open cc accounts.  Not sure what will happen with three.

[vanillabean]

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@haulingthescoreup wrote:

Many banks pull a hard inquiry when the customer calls in to ask for a CLI. Many don't.

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 I always wondered about how many are many? Now I know. Exactly 50%

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@Anonymous wrote:

Equifax slowly punishes the FICO if you have stagnant accounts.   After six months it warns you (with a red block on the "scale")  that there's been "limited activity" on some of your cards.  The score decreases will be slow and steady and will jump back up once you show activity again.  This happened to me with a citi MC which I didn't use for several months and I was wondering why I was losing anywhere from 3 to 7 points a month on scorewatch with no inquiries and no increases in util.

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Interesting. I had no idea that a CRA could tell whether your account is stagnant. Certainly, a reported balance of $0 is not a reliable indicator.

[stan_the_man]

Regarding CLIs: I've requested three in the past 60 days. Chase and Macy's Visa (Department Stores National Bank) did hard inquires. Amex did not.

[Anonymous]

Ok well the reason why I was thinking of requesting a CLI was just to increase the total amount of credit on that card specifically, overall I don't need more credit I only use a very small fraction of the credit I do have at my disposal.  And it was a Chase card, so I'm glad someone confirmed that they do perform a hard inquiry so now I'm just going to forget it.

As for the other thing, technically I have four credit cards, the fourth is my Macy's VISA which I haven't used in months - I only use it once or twice a year when I go to Macy's, I usually buy a ton of stuff at once and the discounts I get for it are quite good.  But most of the time it is stagnant, so I'll have to keep an eye on it to make sure it isn't hurting me.