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Contributor
schrute
Posts: 91
Registered: ‎09-16-2012
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More credit cards lead to a higher credit score?

Right now I'm an AU on one, had another CC for almost 1 year, and just got a new one. My FICO score is really helped by student loans, 16 of them that I've had for 8 years...

New Member
eklausmeyer
Posts: 10
Registered: ‎11-16-2012
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Re: More credit cards lead to a higher credit score?

The short answer: yes.

 

More cards in good standing with balances less than 30% of limits is good.

Next in line: diversity of account types and time.

I work full time as a credit analyst for one of the largest credit card issuers in the U.S. But, I am also a consumer trying to build my own credit!
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schrute
Posts: 91
Registered: ‎09-16-2012
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Re: More credit cards lead to a higher credit score?

My concern is, every time I get a new card, it'll knock my nice 7-8 AAoA down. It's helped up nicely with 16-20 student loans...

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Shogun
Posts: 12,952
Registered: ‎04-15-2011
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Re: More credit cards lead to a higher credit score?

To a point, yes.  But after that, it really doesn't.  Just garden well and you'll be just fine.


Starting Score: 504

July 2013 score: EQ FICO 819, TU08 778, EX "806 lender pull 07/26/2013
Goal Score: All Scores 760+, Newest goal 800+

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Current scores after adding $81K in CLs and 2 new cars since July 2013
EQ:809 TU 777 EX 790 Now it's just garden time!
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chasmith
Posts: 1,062
Registered: ‎05-26-2010
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Re: More credit cards lead to a higher credit score?

Beyond three cards, adding more only helps if you're getting unused limits that help utilization.

BK7 Filed 8/11/2009 Discharged 11/23/2009. Purchased new home 4/11/2012
Starting Score:11/16/2009 EQ 566 11/16/2009 TU 538
Interim Score: 12/27/2012 EQ 683 09/17/2012 EX (lender) 670 1/01/2013 TU 701
Current Score: 11/06/2013 EQ 708 11/06/2013 EX 702 11/16/2013 702 11/06/2013 TU 729
Goal Score: EQ 740 EX 740 TU 740
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guiness56
Posts: 22,408
Registered: ‎01-17-2008
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Re: More credit cards lead to a higher credit score?

There is really no set limit to what is good or not.  The more open cards with balances certainly is not going to help you much.  FICO likes to see you use your credit but wisely.  If you have one card and use it wisely and let it age, it is going to help your score.

 

The only thing more can do is raise your CL and lower utilization.

Contributor
schrute
Posts: 91
Registered: ‎09-16-2012
0

Re: More credit cards lead to a higher credit score?

Is AAoA of open accounts computed differently from AAoA with closed accounts?

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guiness56
Posts: 22,408
Registered: ‎01-17-2008
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Re: More credit cards lead to a higher credit score?

[ Edited ]
Established Contributor
pakman92
Posts: 650
Registered: ‎03-01-2012
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Re: More credit cards lead to a higher credit score?

Lowered util resulting from total credit line will help. However there will be initial negative impact as well for existence of new credit (this will where off after a few months), lowered AAoA and additional inquiry.

My Starting Score: EQ: 691 (11/30/11) TU98: 726 (11/30/11)
My Current Score: EQ: 779 (04/22/13) TU08: 835 (06/03/13)
DW Starting Score: EQ: 742 (03/02/12) TU98: 748 (03/02/12)
DW Current Score: EQ: 784 (03/11/13) TU08: 775 (06/03/13)
Senior Contributor
DaBears
Posts: 3,930
Registered: ‎10-26-2012
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Re: More credit cards lead to a higher credit score?


eklausmeyer wrote:

The short answer: yes.

 

More cards in good standing with balances less than 30% of limits is good. Not true, you can have 2 cards and keeping your UTIL between 1-9%. It's how you manage and using your cards wisely each month.

Next in line: diversity of account types and time. Your AAoA and payment history are the biggest factors in what Fico sees in determining what your score could be. Installment loans have little affect on Fico scoring.

 



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