Unused credit line

[aman31]

I applied for a store credit card to purchase furniture. We decided not to make the purchase and have since purchased elsewhere, so I doubt I would use this card in the future. What is the best way to handle this account? Is it halping in my utilization? Should I keep open or close? Obviously, I shouldnt have applied at all, but at the time, we thought we were getting new furniture. Now we need a mortgage and I need all the help I can get. I only have two small credit cards with about 75% of their balances being used. Thanks.

[MarineVietVet]

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@aman31 wrote:
I applied for a store credit card to purchase furniture. We decided not to make the purchase and have since purchased elsewhere, so I doubt I would use this card in the future. What is the best way to handle this account? Is it halping in my utilization? Should I keep open or close? Obviously, I shouldnt have applied at all, but at the time, we thought we were getting new furniture. Now we need a mortgage and I need all the help I can get. I only have two small credit cards with about 75% of their balances being used. Thanks.

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If it doesn't have an annual fee why not keep it? What is the CL on this card? It should help some with your overall util because the balances on your other two cards are pretty high. May I ask what the CL is on all the cards and the exact balances on the cards being used? That way you can calculate if this new card will actually help much with reducing your overall util. You really need to get those 75% balances down. But you knew that right?

7/09
TU-742
EQ-779

Time can heal all wounds and a low FICO. 

[aman31]

What is the CL on this card? It is $1,500 dollars. I have another credit card with $1,500 unused as well, but I would like to keep it open.

The cards that I use and know I need to pay down are a Paypal line credit 375/500 and capital one 350/500.

When I applied for a mortgage, I saw that the Bankers report showing that I had 82% free, so I thought this card was helping me out.

[MarineVietVet]

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@aman31 wrote:

What is the CL on this card? It is $1,500 dollars. I have another credit card with $1,500 unused as well, but I would like to keep it open.

The cards that I use and know I need to pay down are a Paypal line credit 375/500 and capital one 350/500.

When I applied for a mortgage, I saw that the Bankers report showing that I had 82% free, so I thought this card was helping me out.

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Well let's run some numbers. Without adding the new card your overall util is 29% (725 total balance/2500 total credit limit). If you add the new card CL the overall util becomes 18% (725/4000). The individual card util remains the same (375/500=75% and 350/500=70%. You will be helped by the lower overall util but you really need to get those individual util down quite a bit.

It's pretty limiting trying to use a store card from time to time to keep it active but I'd get it anyway, The inquiry is already on your record and the card has been issued so why not activate it? If they close it eventually for inactivity at least it will have added to your history and AAoA. 

My 2 cents.

7/09
TU-742
EQ-779

Time can heal all wounds and a low FICO. 

"Hello my name is Sandy and I'm a recovering crediholic".

[Anonymous]

Agreed, keep it.  It is helping you.  Currently all cards are $4000 limit with only $725 balance equaling 18% utilization.  That is pretty good.  However, to boost your FICO a little more try to keep overall utilization at 9% or lower and you will see scores improve.  Remember, utilization counts toward 30% of your FICO score so it's very important.

So activate and throw in the sock drawer.  Occassionally go in the store and buy a rug or lamp or something inexpensive to keep the card active and that makes you look like a stud to the wife.  Kill 2 birds with 1 stone...LOL.