topic Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization in Credit Cards

Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization %

Anonymous — Thu, 08 Mar 2018 21:32:00 GMT

So the backstory is my FICO is shot temporarily (550) caused by a prior period of unemployment from late 2016 to early 2017 which caused 100% CC utilization. However, I am now year 1 into a new job and getting my first bonus so getting to work on paying down CC debt. CK simulator says if I pay off 50% of my balance I will be about at at a 650. So I want to start planning now on simplifying the card situation because I initially took out these CCs to build credit and see which ones would be the best 2 years ago. But as you all know all CCs are not created equal.

I don't like the CITI doublecashback, or my Barclay Travel card so I want to close these cards. I will also be paying down a Cap One Spark Biz card that reports on consumer credit but keeping the relationship with Cap One because of their 360 free checking and my other consumer card with them has a high limit and I've never had any issues with them regarding anything. They have a lot of ATMs via allpoint and cashback has been OK.

What I want to do is get a limit increase on the Cap One or Chase by about $4-5k and then close those other 2 cards so I don't get dinged for high utilization. What have been some strategies people have used here to do this type of thing? Is it possible to upgrade my Cap One Consumer from Quicksilver to a card with higher limits? My other is Chase Freedom.

My CL with Cap One is $3800, Chase is $4500. Right now I'm at 100% Utilization (from the 6 month unemployment period) and after the pay down my total utilization will be a little over 50% ($8k out of $16k total CL).

Now I also have some extra income coming in May and November of this year. I am using that to pay down the BOA with a $2k CL and November will pay down $2200 of the Cap One Quicksilver. So by end of year I'll be down from $16800 down to about $6000 or so which will leave me at just under 40% utilization. In addition the multiple inquiries for all these cards will drop off by end of year as the majority of them I applied for in 2016. That should give me 20-30 points hopefully.

Part of next year's bonus will pay off the rest of the consumer CC debt. But I am wondering do I have to wait (or would it be advisable) to wait until March/April 2019 to attempt to get the CL raised when my Score will be closer to 750 again, or if this might backfire with a lower utilization and they reduce my CL as a punishment for paying down the debt (I've heard this happen)

Also all of them have a similar interest rate - So it makes no difference which card I pay first that is why I am paying off the cards I don't like first.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Thu, 08 Mar 2018 21:42:04 GMT

I would be entirely focused on paying off the debt (down to one card reporting a balance between $5 and 8.9% of that card's limit) and not even worry about CLI's etc. at this stage. To worry about that now is getting ahead of yourself.

When your profile starts improving as the debt is reduced, things will start to work themselves out on their own and you will have a clearer idea of where to go.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Thu, 08 Mar 2018 21:46:41 GMT

Paying down the debt is 100% guaranteed at this point. What I do not want to happen is for the CL to decrease because of it. Hence why I need some strategy from folks that have done so and potentially encountered issues related to rapid paydown.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Thu, 08 Mar 2018 21:51:52 GMT

Last year I had two CC with large balances and about 50% utilization. Both were PIF with two months down to zero. Then I asked for and received nice CLI.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Thu, 08 Mar 2018 21:52:18 GMT

I don't really think there is a way you can minimize the risk of that, though.

If it happens, it happens. You can get the limits back once you have everything straightened out.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

K-in-Boston — Thu, 08 Mar 2018 21:56:15 GMT

You mentioned CK, so I have to ask if 550 is an actual FICO score or a score provided by Credit Karma? Do you have other things going on with your credit reports (lates, bankruptcy, leins)? Extremely high utilization certainly kills credit scores, but 550 seems really low if that's the only factor going on. Your actual FICO score could be much higher and with a 550 I'd be shocked that Chase hasn't just closed the account. If the APRs are all equal, I'd honestly work on getting the individual card utilization down first before you risk losing the cards you do want to keep. Particularly if you have a card above 89% utilization, get it paid down ASAP. Once you get down to 29% overall, I'd start to ask for the CLIs and you should be fine.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

SouthJamaica — Thu, 08 Mar 2018 23:21:09 GMT

@Anonymouswrote:
So the backstory is my FICO is shot temporarily (550) caused by a prior period of unemployment from late 2016 to early 2017 which caused 100% CC utilization. However, I am now year 1 into a new job and getting my first bonus so getting to work on paying down CC debt. CK simulator says if I pay off 50% of my balance I will be about at at a 650. So I want to start planning now on simplifying the card situation because I initially took out these CCs to build credit and see which ones would be the best 2 years ago. But as you all know all CCs are not created equal.

I don't like the CITI doublecashback, or my Barclay Travel card so I want to close these cards. I will also be paying down a Cap One Spark Biz card that reports on consumer credit but keeping the relationship with Cap One because of their 360 free checking and my other consumer card with them has a high limit and I've never had any issues with them regarding anything. They have a lot of ATMs via allpoint and cashback has been OK.

What I want to do is get a limit increase on the Cap One or Chase by about $4-5k and then close those other 2 cards so I don't get dinged for high utilization. What have been some strategies people have used here to do this type of thing? Is it possible to upgrade my Cap One Consumer from Quicksilver to a card with higher limits? My other is Chase Freedom.

My CL with Cap One is $3800, Chase is $4500. Right now I'm at 100% Utilization (from the 6 month unemployment period) and after the pay down my total utilization will be a little over 50% ($8k out of $16k total CL).

Now I also have some extra income coming in May and November of this year. I am using that to pay down the BOA with a $2k CL and November will pay down $2200 of the Cap One Quicksilver. So by end of year I'll be down from $16800 down to about $6000 or so which will leave me at just under 40% utilization. In addition the multiple inquiries for all these cards will drop off by end of year as the majority of them I applied for in 2016. That should give me 20-30 points hopefully.

Part of next year's bonus will pay off the rest of the consumer CC debt. But I am wondering do I have to wait (or would it be advisable) to wait until March/April 2019 to attempt to get the CL raised when my Score will be closer to 750 again, or if this might backfire with a lower utilization and they reduce my CL as a punishment for paying down the debt (I've heard this happen)

Also all of them have a similar interest rate - So it makes no difference which card I pay first that is why I am paying off the cards I don't like first.

1. In view of your utilization problem it would be a mistake to close any accounts. Sock drawer them, but don't close them.

2. There's no real strategy for getting CLI's from those issuers. Capital One, having been socked with a high default rate, has gotten very stingy with CLI's, and is even closing accounts. So I strongly advise you to stay out of their hair.

3. Chase isn't easy either, and will require a hard pull.

My advice is just do your best with paying stuff down, and hopefully you'll get an auto CLI here and there. I wouldn't worry about someone taking adverse action against you because you brought your balance down. True, it's happened, but you can't live your life worrying about idiots.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Fri, 09 Mar 2018 01:58:18 GMT

Thanks of the insight South Jamaica, I will wait until next year and go from there. Trying to get a CLI before Mid-2019 where a recession may begin credit is already starting to tighten as you mentioned.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

SouthJamaica — Fri, 09 Mar 2018 03:42:49 GMT

@Anonymouswrote:
Thanks of the insight South Jamaica, I will wait until next year and go from there. Trying to get a CLI before Mid-2019 where a recession may begin credit is already starting to tighten as you mentioned.

I've been building my relationships with credit unions. You may find a friendlier face there, as well as less fees and lower interest. I have cards with modest interest rates, no balance transfer fee, and no cash advance fee... try getting that at a bank.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

UpperNwGuy — Fri, 09 Mar 2018 11:59:57 GMT

1. Pay off the debt.

2. Don't close any of your current cards.

3. Don't open any new cards.

4. Don't ask for any credit limit increases on current cards.

5. Pay off the debt.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Thu, 21 Mar 2019 20:38:16 GMT

I figured I'd bump this thread as it's now a year later and I'm gonna be down to 0% utilization once reporting updates next month 2 of my cards.

So far I did pay down 50% of my cards last year and now the other 50% are gone. I may apply for 2 cards this year since my last inquiry was in March of 2017 or so. I won't close any cards if they want to close them for lack of usage then so be it.

I am way within the Chase 5/24 rule (only 1 chase card from 2 years ago) so should I get a new Chase card, a 2nd Cap One or maybe AMX? I want to increase my overall CL so I can start to maximize rewards/cash back.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Fri, 22 Mar 2019 01:00:24 GMT

Welcome back and great job staying the course to pay off your debt.

How are your FICO scores doing?

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

GeorgiaBulldog — Fri, 22 Mar 2019 01:58:32 GMT

@Anonymous wrote:
I am way within the Chase 5/24 rule (only 1 chase card from 2 years ago) so should I get a new Chase card, a 2nd Cap One or maybe AMX? I want to increase my overall CL so I can start to maximize rewards/cash back.

Welcome back, and congrats on your progress. Be aware that the 5/24 rule applies to personal cards from all issuers (except non-visa/mc/amex store cards). The way you worded that sentence makes it sound like you think it's only Chase cards that count.

If you are for sure under 5/24, your scores are up and you don't have many (or any) derogs, I'd definitely go with Chase first. The CSP has a solid bonus right now, and it's hard to go wrong with a UR card since the points are flexible. It's about personal preference from there, I'd say... lots of different hotel and airline cards.

I love Amex as well, but they aren't as restrictive with approvals as Chase, so I'd definitely get everything under that Chase 5/24 umbrella you want before you move on to Amex.

I can't offer advice on Cap1--used to get pre-approval mailers and pre-qualifications on their website, but when I finally got ready to apply, those prequals were gone and I got a big fat denial, lol.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

FinStar — Fri, 22 Mar 2019 02:30:26 GMT

@GeorgiaBulldog wrote:
@Anonymous wrote:
I am way within the Chase 5/24 rule (only 1 chase card from 2 years ago) so should I get a new Chase card, a 2nd Cap One or maybe AMX? I want to increase my overall CL so I can start to maximize rewards/cash back.
Welcome back, and congrats on your progress. Be aware that the 5/24 rule applies to personal cards from all issuers (~~except non-visa/mc/amex store cards)~~. The way you worded that sentence makes it sound like you think it's only Chase cards that count.

If you are for sure under 5/24, your scores are up and you don't have many (or any) derogs, I'd definitely go with Chase first. The CSP has a solid bonus right now, and it's hard to go wrong with a UR card since the points are flexible. It's about personal preference from there, I'd say... lots of different hotel and airline cards.

I love Amex as well, but they aren't as restrictive with approvals as Chase, so I'd definitely get everything under that Chase 5/24 umbrella you want before you move on to Amex.

I can't offer advice on Cap1--used to get pre-approval mailers and pre-qualifications on their website, but when I finally got ready to apply, those prequals were gone and I got a big fat denial, lol.

Just for clarification for the OP, and based on a variety of previously established data points and updated threads from other sources, store cards count in a variety of circumstances with the 5/24 restriction. The tradelines that seem to be exempt are mortgage/personal/student loans and the like. But, as with anything, YEMV.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Blackswizz750 — Fri, 22 Mar 2019 02:47:57 GMT

I would be more concerned with getting the debt paid off since you have the funds. Lenders can do AA with normal pif every month activity. Over time just diversify you banks.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Fri, 22 Mar 2019 04:13:43 GMT

Thanks for clarifying 5/24....I evidently have more browsing to do... I almost effed up as I completely forgot about 2 store cards I got in the past 2 years. I'll have to check the dates on those!!!

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

SouthJamaica — Fri, 22 Mar 2019 13:51:43 GMT

@Anonymous wrote:
Thanks for clarifying 5/24....I evidently have more browsing to do... I almost effed up as I completely forgot about 2 store cards I got in the past 2 years. I'll have to check the dates on those!!!

In order to answer your question -- what to apply for -- we're going to need to know

-your FICO scores

-the cards you have

-what you're looking for in a card

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Fri, 22 Mar 2019 20:09:52 GMT

I looked into the signature haven't had the chance to configure yet...

680 EXP, but anticipating 700 once my last 2 cards post zero balance in April (will have 5% utilization leftover from other cards) I have to check TU and EQ outside of CK but my scores across all 3 are typically very close.

I currently have

Chase Freedom Unlimited
Best Buy CITI
CITI Double Cash
BOA rewards
Cap One Quick Silver
Cap One Spark Biz
Barclay Arrival
Amex Biz
Amazon Synchrony

Total CL including Amex Biz (doesn't report balance to consumer) is about 27k

Looking for a no annual fee BT card and potentially a no annual fee travel card with an intro bonus. I probably won't qualify for Discover or WF with the D120s from 2013 as mentioned on my other thread.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

NRB525 — Fri, 22 Mar 2019 22:22:01 GMT

Do you have any BT offers from Citi or BofA on your existing cards? Those have a few, but a known CL, and no HP., no new account ding as you try to improve score.

Re: Strategy on Increasing limit on preferred cards and close others, minimize impact on utilization

Anonymous — Fri, 22 Mar 2019 22:28:46 GMT

CITI offered me a 0 for 9 BT on the existing DC with the measly $1.5k CL.

F*** CITI 👎👎👎