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New Contributor
Posts: 65
Registered: ‎08-23-2012
0

Upgrade path

Long time lurker, first time poster.  Here's my current portfolio and my thoughts on obtaining so large limit credit cards (>40k) going forward for the next 2-3 years.

 

Credit Karma score: 788

 

Ex: 791

TU: 787

Eq: 801

 

No baddies, COs, lates, etc. 

 

AAoA: 2yr 11m

 

Card / Balance / Limit

 

Chase Freedom: $825 / $30,000

NFCU Platinum: $3000  /$27,500

Best Buy Store Card: $0 / $18,000

NFCU Navcheck: $0 / $15,000

Lowes Store Card: $0 / $12,000

Furniture Row Store Card: $0 / $10,100

Chase Sapphire: $100 / $8,000

Macy's Store Card: $0 / $4,400

 

Annual Income: $78,000

 

Been with NFCU for primary checking, savings, navcheck, credit card, certificate, and auto loan for about 3 years now.  Direct deposit setup with them. (love their remote deposit android app)

 

Been thinking of applying for their Flagship card which goes up to 80k on the limit and hoping that they give a good sized starting limit for it.  Maybe around $15k-$20k.  Take a year or two to get the CL increased to perhaps 30k?  Then combine the CL from both NFCU cards together and hopefully get about a 60k limit on the Flagship.  What are your thoughts on that? Pros and cons?

 

I'm thinking of doing the same with the Chase Freedom and Sapphire.  I'd like to get the CL on the Sapphire up and then combine those two cards together and probably keep the Freedom. My Freedom card is 11years old and I don't want it closed out taking a hit on AAoA.

 

Is this a reasonable plan going forward, or are my expectations too high? Don't be afraid to tell me your straight up answer.  Sugar coating not needed as I have a tough skin.

 

NFCU Flagship - 50k | Chase Sapphire Preferred - 38k | AMEX BCE - 29.3k | Best Buy Store Card - 21k | Furniture Row - 19.7k | Lowes Card - 16k | NFCU LOC - 15k | Amazon Store - 12k | Macy's - 6000
Valued Contributor
Posts: 3,096
Registered: ‎01-26-2012
0

Re: Upgrade path

Why get cl that high?  I personally growing my cl recently but keeping them around 30ish max

               LIMITS IN CARD DESCRIPTIONS
New Contributor
Posts: 65
Registered: ‎08-23-2012
0

Re: Upgrade path

I always thought it was better to obtain higher limits for sake of FICO scores, however, my lack of knowledge on this area shows badly and any advice that can be given out on why not to go so high will be gladly taken in.

NFCU Flagship - 50k | Chase Sapphire Preferred - 38k | AMEX BCE - 29.3k | Best Buy Store Card - 21k | Furniture Row - 19.7k | Lowes Card - 16k | NFCU LOC - 15k | Amazon Store - 12k | Macy's - 6000
Epic Contributor
Posts: 28,802
Registered: ‎10-23-2007
0

Re: Upgrade path


riker20 wrote:

I always thought it was better to obtain higher limits for sake of FICO scores, however, my lack of knowledge on this area shows badly and any advice that can be given out on why not to go so high will be gladly taken in.


I have never had higher then $25k so I only know what I have read, Credit Lines over a certain point, some debate on what that number is $40-$50k is what I read about most will no longer show as a revolving credit card, it will show as an installment I believe.  Not completely sure how that effects your Fico if you had a sizable balance, but can't really think of why it would hurt you if you have other high limit cards $15-$30k that would still report normally.

 

Now I do know that higher limits is not going to help your score unless your Util. was REALLY high and then some high limit $0 balance cards could help counter that a bit. but you would still have scoring of each card by itself too.

New Contributor
Posts: 65
Registered: ‎08-23-2012
0

Re: Upgrade path

So it sounds like cards over 40k may not report as revolving credit, but actually report as an installment.  I'll do some googling to find out if that is good/bad for your FICO score. 

 

Maybe I can work on the NFCU route with their Flagship card, but still keep the Chase Freedom/Sapphire at 30k and below.

NFCU Flagship - 50k | Chase Sapphire Preferred - 38k | AMEX BCE - 29.3k | Best Buy Store Card - 21k | Furniture Row - 19.7k | Lowes Card - 16k | NFCU LOC - 15k | Amazon Store - 12k | Macy's - 6000
Valued Contributor
Posts: 3,096
Registered: ‎01-26-2012
0

Re: Upgrade path

It is not so much that it shows up on your credit report differently.  After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations.  Normally high limits are good as it allows higher reported balances while keeping util low.  But after the threshold, the card is treated as installment loan.  This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving.  Obviously this can change and has probably been changing in the past.  My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.

               LIMITS IN CARD DESCRIPTIONS
Valued Contributor
Posts: 3,096
Registered: ‎01-26-2012
0

Re: Upgrade path


riker20 wrote:

So it sounds like cards over 40k may not report as revolving credit, but actually report as an installment.  I'll do some googling to find out if that is good/bad for your FICO score. 

 

Maybe I can work on the NFCU route with their Flagship card, but still keep the Chase Freedom/Sapphire at 30k and below.


Revolving utilization is one of the biggest effects on FICO.  Lets say have two cards with 30k limit and 6k statement balance on one card for total utilizaiton of 10%.  If suddenly you got CLI on one card to 45k and caused it to be removed from revolving util calculations, the 6k on the 30k would result in 20% util.  You would probably lose 10-30ish FICO points over that (really depends on the current FICO score).  Problem is since you can't tell by looking at report when they take a card out of util calculations, you basically have to guess and trip over the threshold and notice the FICO reduction.

               LIMITS IN CARD DESCRIPTIONS
Epic Contributor
Posts: 28,802
Registered: ‎10-23-2007
0

Re: Upgrade path


Crashem wrote:

It is not so much that it shows up on your credit report differently.  After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations.  Normally high limits are good as it allows higher reported balances while keeping util low.  But after the threshold, the card is treated as installment loan.  This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving.  Obviously this can change and has probably been changing in the past.  My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.


HiJACK - Why do you have a Firestone Card??!  Sorry if it actually makes sense for you but it is funny (in my mindSmiley Tongue) to be reading $23kk, $30k, $100k, Firestone $2.2k!

That bank has not seen a credit score above 600 in the last 5 yearsSmiley Tongue

I have one, but it's gone inactive long ago, never used it but they literally didn't decline anyone back 5+ years.

New Contributor
Posts: 65
Registered: ‎08-23-2012
0

Re: Upgrade path

Thats a great way to look at it.  Great explaination.  Thank you for the insight.  I'm always reading the posts on here and see you posting all the time.  I figured you might chime in on this thread.

NFCU Flagship - 50k | Chase Sapphire Preferred - 38k | AMEX BCE - 29.3k | Best Buy Store Card - 21k | Furniture Row - 19.7k | Lowes Card - 16k | NFCU LOC - 15k | Amazon Store - 12k | Macy's - 6000
New Contributor
Posts: 65
Registered: ‎08-23-2012
0

Re: Upgrade path


Creditaddict wrote:

Crashem wrote:

It is not so much that it shows up on your credit report differently.  After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations.  Normally high limits are good as it allows higher reported balances while keeping util low.  But after the threshold, the card is treated as installment loan.  This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving.  Obviously this can change and has probably been changing in the past.  My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.


HiJACK - Why do you have a Firestone Card??!  Sorry if it actually makes sense for you but it is funny (in my mindSmiley Tongue) to be reading $23kk, $30k, $100k, Firestone $2.2k!

That bank has not seen a credit score above 600 in the last 5 yearsSmiley Tongue

I have one, but it's gone inactive long ago, never used it but they literally didn't decline anyone back 5+ years.


I'd like to see a set of 4 firestone tires that cost more than $2200 for car!

 

NFCU Flagship - 50k | Chase Sapphire Preferred - 38k | AMEX BCE - 29.3k | Best Buy Store Card - 21k | Furniture Row - 19.7k | Lowes Card - 16k | NFCU LOC - 15k | Amazon Store - 12k | Macy's - 6000

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