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new cards & impact on credit

Established Member

new cards & impact on credit

I posted another question about costco AMEX, but this question is different.  Rather than hijacking my own post, I figured I would post a different question.  Sorry if I am spamming the boards.

 

Wife & I opened a costco Amex this weekend, and a department store card.  The amex was for cash back, and the perks of being a costco member (cash back on purchases there, only credit card they take, etc).  The department store gave her 20% off of her purchase.

 

She has mid 700s scores, and very low util. (plus a car & student loan - no mort).  What will this do to her scores?


TransUnion 696 4/15/2010
Equifax 683 4/15/2010

TransUnion 675 8/30/2010
Equifax 688 8/30/2010

Still trying to get my scores up =\ Opening new trades in the last 12 months didn't help. =(
4 REPLIES
Valued Contributor

Re: new cards & impact on credit

Hi, I'm pretty sure the impact will be losing the AAoA....since she already has low utilization,when the new card reports it won't help her utilization, because it is already low....That is another bucket theory discussion.. Unless you are planning on buying a house or a car soon, I would not worry about the new credit ding.

She might have lost a couple of points for the two new accounts - not significant.

 

I'm no expert however.

Thanks.


Starting Score: 682 EQ, 663 TU
Current Score: 687 EQ - 705 TU on 7/18/10
Goal Score: 700 + both EQ and TU


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Valued Contributor

Re: new cards & impact on credit


jrdenver wrote:

I posted another question about costco AMEX, but this question is different.  Rather than hijacking my own post, I figured I would post a different question.  Sorry if I am spamming the boards.

 

Wife & I opened a costco Amex this weekend, and a department store card.  The amex was for cash back, and the perks of being a costco member (cash back on purchases there, only credit card they take, etc).  The department store gave her 20% off of her purchase.

 

She has mid 700s scores, and very low util. (plus a car & student loan - no mort).  What will this do to her scores?


I have recently added 4 new accounts (school loans, cc, etc.) and have seen very little movement down because of it...only 6 points. You will usually lose a bit per new account, at least until they turn 6 mo and then 1 yr old. As the previous poster said, this will bring down her average age of accounts some. Without knowing what that is now, it's hard to tell what that impact may be. Also, there may be a bit of a loss due to the inquiries.

 

Things vary, however. I have an old, quite lengthy credit file. I also have a mortgage (on an investment property). Who knows...it may take more to move mine. There are so many moving parts to a FICO score that it is difficult to predict.

Frequent Contributor

Re: new cards & impact on credit

adding about 15k to a 30k limit with 50% util made me jump up. Not sure of the timing but I add about 35k to a 30k limit over 1 day and  moved me from 680's to about 750. The reporting delay makes me not sure which one did what.
TransUnion/Equifax
746/754
Date: 9/24/2009/10/02/2009
Moderator Emerita

Re: new cards & impact on credit

As daisyduke said, a lot will depend on what this did to her AAoA (average age of accounts.) There seem to be certain clumps of age --under 6 months, 2 years and under, 3-5 years, 5-8 years, and so forth. If adding a new account dropped her from one tier to the next lower down, there might be some damage.

Otherwise, any damage will be from the hard inq --there might be none at all if she hasn't had another hard on Experian during the past twelve months --and simply having a new account, which will last 6 months. Depending on where her util is now, this might all cancel out.

At any rate, I can't see her scores dropping more than 10 points, until her AAoA gets significantly changed, and it might well be less than that.

Predicting score changes makes fools of us all at one time or another, though. Smiley Tongue
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007