Fico says adding a credit card would increase score to 821

[LuvsRetro]

So I recently have just started rebuilding and currently reporting is:

1 open au Cap1 (2006)

1 open Mortgage (1998).

1 closed VS/Comenity (1994)

AAoA:  23yrs, 1mo.

Experian Score 781.....................No baddies

Fico simulator says if I get a Credit Card score will go up to 821.

If I get a Store Card it will go down to 776.

Why would that be?   I was thinking that it would go down.

Also, this week I have been approved for Amex BCE $6,000, Discover It $2,500, Barclays $2,500.

I am not wanting to apply for anything for awhile till these report and start aging.   I am just trying to understand the process of having credit again.

[Anonymous]

Simulators give notoriously bad advice.  A store card should not affect your FICO score in a way different from a major credit card.  That said, store cards do harm your score in some other non-FICO models, so a person should always tend to prefer to open a major credit card rather than a store card, unless he has some compelling reason for the store card.

You are right to want to wait until you have had your three new cards appearing on your reports for at least a few months before you do anything else.  Wait until all three appear, and then make sure all cards are reporting zero except one (AZEO) with the remaining card reporting a small balance.  Then you'll know what your new scores are.  Until then use each card for something small (that you actually need) each month.

PS.  Your AAoA (average age of accounts) is not 23 years.  Do the math and you'll see that this is true.  What does appear to be true is that your Age of Oldest Account is 23 years.

[Anonymous]

OP, so let's make sure I'm clear on this.  Did you have zero credit cards and just added 3, meaning that you now have 3?  If that's the case, you are all set as 3 revolvers is all that is really recommended for ideal FICO scoring purposes.  As CGID correctly points out, for maximum scoring benefit you'll want to allow just 1 of the 3 cards to report a small balance every month. 

If you scores are in the 780's without any revolving accounts present, I would think that in 6 months time from adding these new (revolver) accounts so long as you're implementing AZEO your scores will be above 800.  Typically you'll see a slight score drop from new accounts, inquiries and the age of accounts reduction(s) right off the bat, but after 3-4 months they'll usually be back to where they started and rise from there.

[DollyLama]

The reason of the new credit, your file is thin now, so it will bump you in points.With the 3 you were approved, that will do it. Pretty much any new cards after that you will not see the large bumps, and helps your file be a bit thicker as time passes. 

CGiD and BBS is correct on the AZEO with good advice. So the next step would be if you after about 6mos or so of establishing with the new cards, do you really need to be an AU on the card- as that can mess up controlling only letting one card report a balance, you're relying on the person to not ever let a balance hit at statement cut.  Utilization, etc. 

[jamie123]

Your AAoA (Average Age of Accounts) will be cut in half once the new cards report but you are making a really good credit decision by getting the 3 new CCs.

If you are just looking to build your scores and don't really need the use of the credit cards, I would suggest waiting a year and then adding just 1 or 2 more credit cards. As the others have stated previously, you don't need to do anything after you have your 3 cards but it would be nice if you had a thicker file. (More accounts.) Just slowly add 1 new card a year for the next couple of years.

[LuvsRetro]

Ah, did not notice the AAoA figure not adding up correctly.  Thank you for pointing that Out!  

So the AZEO must be the 2 dollar thing that posters have talked about.  I will do that.  

Thank you.  

[LuvsRetro]

Yes, I had zero cards.  I am au on DHs Cap1.  

I did notice a 10 point drop from the inquiries.

[LuvsRetro]

As far as the Au card ($1700), we had not used it for a couple of years, so to keep it open, I charged less than  $200 to force a reporting.  It is Dh's only card as well.

[marty56]

If the only open CC you have is by AU, then you need your own CC.  This will allow you to better control your own destiny.

[LuvsRetro]

Barclay's reported over nite and Experian is now 799, up 18 pts.  Yay