topic Re: Upgrade path in Credit Cards

Upgrade path

Anonymous — Thu, 23 Aug 2012 13:49:15 GMT

Long time lurker, first time poster. Here's my current portfolio and my thoughts on obtaining so large limit credit cards (>40k) going forward for the next 2-3 years.

Credit Karma score: 788

Ex: 791

TU: 787

Eq: 801

No baddies, COs, lates, etc.

AAoA: 2yr 11m

Card / Balance / Limit

Chase Freedom: $825 / $30,000

NFCU Platinum: $3000 /$27,500

Best Buy Store Card: $0 / $18,000

NFCU Navcheck: $0 / $15,000

Lowes Store Card: $0 / $12,000

Furniture Row Store Card: $0 / $10,100

Chase Sapphire: $100 / $8,000

Macy's Store Card: $0 / $4,400

Annual Income: $78,000

Been with NFCU for primary checking, savings, navcheck, credit card, certificate, and auto loan for about 3 years now. Direct deposit setup with them. (love their remote deposit android app)

Been thinking of applying for their Flagship card which goes up to 80k on the limit and hoping that they give a good sized starting limit for it. Maybe around $15k-$20k. Take a year or two to get the CL increased to perhaps 30k? Then combine the CL from both NFCU cards together and hopefully get about a 60k limit on the Flagship. What are your thoughts on that? Pros and cons?

I'm thinking of doing the same with the Chase Freedom and Sapphire. I'd like to get the CL on the Sapphire up and then combine those two cards together and probably keep the Freedom. My Freedom card is 11years old and I don't want it closed out taking a hit on AAoA.

Is this a reasonable plan going forward, or are my expectations too high? Don't be afraid to tell me your straight up answer. Sugar coating not needed as I have a tough skin.

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 13:53:59 GMT

Why get cl that high? I personally growing my cl recently but keeping them around 30ish max

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 14:04:45 GMT

I always thought it was better to obtain higher limits for sake of FICO scores, however, my lack of knowledge on this area shows badly and any advice that can be given out on why not to go so high will be gladly taken in.

Re: Upgrade path

Creditaddict — Thu, 23 Aug 2012 14:30:15 GMT

@Anonymous wrote:
I always thought it was better to obtain higher limits for sake of FICO scores, however, my lack of knowledge on this area shows badly and any advice that can be given out on why not to go so high will be gladly taken in.

I have never had higher then $25k so I only know what I have read, Credit Lines over a certain point, some debate on what that number is $40-$50k is what I read about most will no longer show as a revolving credit card, it will show as an installment I believe. Not completely sure how that effects your Fico if you had a sizable balance, but can't really think of why it would hurt you if you have other high limit cards $15-$30k that would still report normally.

Now I do know that higher limits is not going to help your score unless your Util. was REALLY high and then some high limit $0 balance cards could help counter that a bit. but you would still have scoring of each card by itself too.

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 14:34:42 GMT

So it sounds like cards over 40k may not report as revolving credit, but actually report as an installment. I'll do some googling to find out if that is good/bad for your FICO score.

Maybe I can work on the NFCU route with their Flagship card, but still keep the Chase Freedom/Sapphire at 30k and below.

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 14:35:56 GMT

It is not so much that it shows up on your credit report differently. After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations. Normally high limits are good as it allows higher reported balances while keeping util low. But after the threshold, the card is treated as installment loan. This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving. Obviously this can change and has probably been changing in the past. My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 14:40:19 GMT

@Anonymous wrote:
So it sounds like cards over 40k may not report as revolving credit, but actually report as an installment. I'll do some googling to find out if that is good/bad for your FICO score.

Maybe I can work on the NFCU route with their Flagship card, but still keep the Chase Freedom/Sapphire at 30k and below.

Revolving utilization is one of the biggest effects on FICO. Lets say have two cards with 30k limit and 6k statement balance on one card for total utilizaiton of 10%. If suddenly you got CLI on one card to 45k and caused it to be removed from revolving util calculations, the 6k on the 30k would result in 20% util. You would probably lose 10-30ish FICO points over that (really depends on the current FICO score). Problem is since you can't tell by looking at report when they take a card out of util calculations, you basically have to guess and trip over the threshold and notice the FICO reduction.

Re: Upgrade path

Creditaddict — Thu, 23 Aug 2012 14:40:58 GMT

@Anonymous wrote:
It is not so much that it shows up on your credit report differently. After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations. Normally high limits are good as it allows higher reported balances while keeping util low. But after the threshold, the card is treated as installment loan. This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving. Obviously this can change and has probably been changing in the past. My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.

HiJACK - Why do you have a Firestone Card??! Sorry if it actually makes sense for you but it is funny (in my mind) to be reading $23kk, $30k, $100k, Firestone $2.2k!

That bank has not seen a credit score above 600 in the last 5 years

I have one, but it's gone inactive long ago, never used it but they literally didn't decline anyone back 5+ years.

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 14:43:59 GMT

Thats a great way to look at it. Great explaination. Thank you for the insight. I'm always reading the posts on here and see you posting all the time. I figured you might chime in on this thread.

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 14:45:40 GMT

@Creditaddict wrote:
@Anonymous wrote:
It is not so much that it shows up on your credit report differently. After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations. Normally high limits are good as it allows higher reported balances while keeping util low. But after the threshold, the card is treated as installment loan. This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving. Obviously this can change and has probably been changing in the past. My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.
HiJACK - Why do you have a Firestone Card??! Sorry if it actually makes sense for you but it is funny (in my mind) to be reading $23kk, $30k, $100k, Firestone $2.2k!
That bank has not seen a credit score above 600 in the last 5 years
I have one, but it's gone inactive long ago, never used it but they literally didn't decline anyone back 5+ years.

I'd like to see a set of 4 firestone tires that cost more than $2200 for car!

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 15:13:12 GMT

@Creditaddict wrote:
@Anonymous wrote:
It is not so much that it shows up on your credit report differently. After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations. Normally high limits are good as it allows higher reported balances while keeping util low. But after the threshold, the card is treated as installment loan. This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving. Obviously this can change and has probably been changing in the past. My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.
HiJACK - Why do you have a Firestone Card??! Sorry if it actually makes sense for you but it is funny (in my mind) to be reading $23kk, $30k, $100k, Firestone $2.2k!
That bank has not seen a credit score above 600 in the last 5 years
I have one, but it's gone inactive long ago, never used it but they literally didn't decline anyone back 5+ years.

Its my one big regret. Fact is I have had extensive knowledge of credit industry/scoring for a long time. Never really thought to apply knowledge to my own situation until the last year or so. Had enough credit and wasn't a big user of credit. But that firestone card was mistake from before I started thinking about my own credit. Got the card when had to replace one tire that turned into 4 tires. Bought the get XX% off, if you get our Firestone card today. Got my credit limit of 1800 and was like **bleep**. But they told me that was a great starting credit line. Even worse, they pulled from all 3 credit bureaus (grrr). Did however recently get soft based CLI to 2.2k. So sad I even did it in the first place. Wasn't worth the AAoA hit, the inquiry hit for the discount. But at this point, might as well make the best of it.

Re: Upgrade path

Creditaddict — Thu, 23 Aug 2012 15:58:22 GMT

@Anonymous wrote:
@Creditaddict wrote:
@Anonymous wrote:
It is not so much that it shows up on your credit report differently. After a certain amount (unclear as I hear 30ish to 40ish), the FICO formula itself removes the card from revolving util calculations. Normally high limits are good as it allows higher reported balances while keeping util low. But after the threshold, the card is treated as installment loan. This was originally done because of HELOCs which were ruining people's credit score as they were reflecting as revolving. Obviously this can change and has probably been changing in the past. My feeling is to get to 30ishK on cards until concrete evidence comes that they no longer do this anymore.
HiJACK - Why do you have a Firestone Card??! Sorry if it actually makes sense for you but it is funny (in my mind) to be reading $23kk, $30k, $100k, Firestone $2.2k!
That bank has not seen a credit score above 600 in the last 5 years
I have one, but it's gone inactive long ago, never used it but they literally didn't decline anyone back 5+ years.
Its my one big regret. Fact is I have had extensive knowledge of credit industry/scoring for a long time. Never really thought to apply knowledge to my own situation until the last year or so. Had enough credit and wasn't a big user of credit. But that firestone card was mistake from before I started thinking about my own credit. Got the card when had to replace one tire that turned into 4 tires. Bought the get XX% off, if you get our Firestone card today. Got my credit limit of 1800 and was like **bleep**. But they told me that was a great starting credit line. Even worse, they pulled from all 3 credit bureaus (grrr). Did however recently get soft based CLI to 2.2k. So sad I even did it in the first place. Wasn't worth the AAoA hit, the inquiry hit for the discount. But at this point, might as well make the best of it.

Well if you got a discount and are not looking to get a new mortgage in the next year, or even if with your score! then I would take it too... Credit used correctly I believe can be a great tool to save lots of money if you leverage correctly, and while you probably saw a bigger drop then someone like me might see to open 1 account and have a HP on all 3 (I don't get that!) I only had 1 back when.

But why I have fantastic credit if you can't benefit from it?!

Re: Upgrade path

CS800 — Thu, 23 Aug 2012 16:03:56 GMT

@Anonymous wrote:
Long time lurker, first time poster. Here's my current portfolio and my thoughts on obtaining so large limit credit cards (>40k) going forward for the next 2-3 years.

Credit Karma score: 788

Ex: 791
TU: 787
Eq: 801

No baddies, COs, lates, etc.

AAoA: 2yr 11m

Card / Balance / Limit

Chase Freedom: $825 / $30,000
NFCU Platinum: $3000 /$27,500
Best Buy Store Card: $0 / $18,000
NFCU Navcheck: $0 / $15,000
Lowes Store Card: $0 / $12,000
Furniture Row Store Card: $0 / $10,100
Chase Sapphire: $100 / $8,000
Macy's Store Card: $0 / $4,400

Annual Income: $78,000

Been with NFCU for primary checking, savings, navcheck, credit card, certificate, and auto loan for about 3 years now. Direct deposit setup with them. (love their remote deposit android app)

Been thinking of applying for their Flagship card which goes up to 80k on the limit and hoping that they give a good sized starting limit for it. Maybe around $15k-$20k. Take a year or two to get the CL increased to perhaps 30k? Then combine the CL from both NFCU cards together and hopefully get about a 60k limit on the Flagship. What are your thoughts on that? Pros and cons?

I'm thinking of doing the same with the Chase Freedom and Sapphire. I'd like to get the CL on the Sapphire up and then combine those two cards together and probably keep the Freedom. My Freedom card is 11years old and I don't want it closed out taking a hit on AAoA.

Is this a reasonable plan going forward, or are my expectations too high? Don't be afraid to tell me your straight up answer. Sugar coating not needed as I have a tough skin.

That's a nice CL on your freedom

Re: Upgrade path

Anonymous — Thu, 23 Aug 2012 16:24:30 GMT

Thanks! Used to be $32,000., but I had Chase re-distribute some of it to the Sapphire when I was approved for the Sapphire. I did a balance transfer with the Sapphire and I didn't want it to show high util, so I had them move a couple thousand around on the limits.