topic Re: "App Spree" Logic..help me understand this. in Credit Cards

"App Spree" Logic..help me understand this.

Anonymous — Mon, 03 Sep 2012 12:28:08 GMT

What's the reasoning behind applying for multiple cards at 1 time? How does this benefit your credit profile/score? How does putting your profile on alert with all of your lenders help you establish a good relationship? Also, how does having several 500$ - 1000$ limit cards help your purchasing power? Wouldn't your creditors be less like to extend you more credit if you have many "toy limit" cards. Doesn't this go against the old mantra "apply for credit as you need it"?

These are all somewhat rhetorical, but I really don't understand the thought process behind it. There are several people on the credit board that go on these sprees only to end up "laying" these very low limit cards to pasture, out growing the lender or CL, etc.

I'm fairly new to the credit game..as many of you probably have history longer than i've been alive...so, there maybe something I'm missing...help me understand?

Re: "App Spree" Logic..help me understand this.

LS2982 — Mon, 03 Sep 2012 12:35:32 GMT

@Anonymous wrote:
What's the reasoning behind applying for multiple cards at 1 time? How does this benefit your credit profile/score? How does putting your profile on alert with all of your lenders help you establish a good relationship? Also, how does having several 500$ - 1000$ limit cards help your purchasing power? Wouldn't your creditors be less like to extend you more credit if you have many "toy limit" cards. Doesn't this go against the old mantra "apply for credit as you need it"?

These are all somewhat rhetorical, but I really don't understand the thought process behind it. There are several people on the credit board that go on these sprees only to end up "laying" these very low limit cards to pasture, out growing the lender or CL, etc.

I'm fairly new to the credit game..as many of you probably have history longer than i've been alive...so, there maybe something I'm missing...help me understand?

I wish I made better decisions on apps early in my rebuilding journey, I would have apped for better cards 1 at a time every 6 months.

Re: "App Spree" Logic..help me understand this.

Anonymous — Mon, 03 Sep 2012 12:38:47 GMT

They should really call it an "App binge".

Generally, when people can't resist the urge anymore they app for multiple cards because all the HPs will fall off at the same time. Once the dust clears they'll look for a company that doesn't pull whatever bureau has the lowest number of pulls or lock their other reports.

Some keep apping until getting a yes or spend all their time between apps obsessing over the next one.

Getting approved for a bunch of low limit cards and then fighting for CLIs is another way people do it.

I'm still pretty much convinced slow and steady wins the race but have probably suffered at times for being too conservative.

Re: "App Spree" Logic..help me understand this.

Anonymous — Mon, 03 Sep 2012 14:01:01 GMT

There's the idea that you will take a big hit right away from the inquiries and drop to AAoA, but you will recover more quickly than if you spread the apps out over time. There is some truth to that, that if you apply for all the cards you want at one time, in 2 years they will all be 2 years old, whereas if you spread them out many will be younger. So if you spree, you take a bigger hit right now, but can recover better over time. However, a lot of the time it seems more like an excuse to justify the "app itch" that many feel. Thinking, "I need to go ahead and app for all these cards I want right now so I'm in better shape later" when really you don't need them or it would be smarter to wait. Then people don't get the limits they wanted and in a few months they want to close some of their cards and go on another spree....

Re: "App Spree" Logic..help me understand this.

Anonymous — Mon, 03 Sep 2012 14:16:55 GMT

@Anonymous wrote:
What's the reasoning behind applying for multiple cards at 1 time? How does this benefit your credit profile/score? How does putting your profile on alert with all of your lenders help you establish a good relationship? Also, how does having several 500$ - 1000$ limit cards help your purchasing power? Wouldn't your creditors be less like to extend you more credit if you have many "toy limit" cards. Doesn't this go against the old mantra "apply for credit as you need it"?

The It's possible my perspective's a bit different, as a rebuilder, than someone who's starting out fresh. I've also never actually gone on an app spree, FWIW.

But for me? I could care less about "purchasing power". Credit isn't money. True financial stability has very little to do with how much you've been invited to charge up, really. I just want some positive tradelines reporting. So a few cards with smaller limits would be fine for me. And honestly, I think the "apply for credit as you need it" has gone the way of the dodo bird. It's easier to get credit when you don't need it. Just ask anyone who's gone through any major life changes that left them short.

That said, I really don't understand folks who look to get as much credit as possible without being thoughtful about it. I can understand apping within a certain time frame so that in inquiries fall off at the same time, but if it's moved into the "binge" territory as drkaje mentioned? That's a little beyond the beyonds. But I can understand it. If you've gotten to a place, emotionally, where a getting credit card has become a status thing, rather than a plain & simple tool, then no wonder. These very boards have stories about people who app 20x at a stretch, or want a certain card just because. There was someone who wanted an Amex Platinum, just because...and he didn't care about the $450 AF, even though he had a fairly low income and couldn't use much of the rewards. Just wanted it.

Re: "App Spree" Logic..help me understand this.

emptypockets — Mon, 03 Sep 2012 15:48:44 GMT

@Anonymous wrote:
What's the reasoning behind applying for multiple cards at 1 time? How does this benefit your credit profile/score? How does putting your profile on alert with all of your lenders help you establish a good relationship? Also, how does having several 500$ - 1000$ limit cards help your purchasing power? Wouldn't your creditors be less like to extend you more credit if you have many "toy limit" cards. Doesn't this go against the old mantra "apply for credit as you need it"?

These are all somewhat rhetorical, but I really don't understand the thought process behind it. There are several people on the credit board that go on these sprees only to end up "laying" these very low limit cards to pasture, out growing the lender or CL, etc.

I'm fairly new to the credit game..as many of you probably have history longer than i've been alive...so, there maybe something I'm missing...help me understand?

I have done a 'app spree,' and to be honest some of it is just because Ialways wanted certain cards. But also, there were cards that were newly available (US Bank Cash +, for example), that I felt I would be able to get at the time I was ready to app. There is some logic to doing apps at the same time so they age off together. Especially if you are closing some cards after you are appoved for the new ones.

People have different reasons for their app sprees. Some people app spree because they get cards for rewards, then cycle (churn) them, every so often to keep getting large sign up bonuses. Some people just are seeking more credit t help with utilization, some are adding cards they could't get when they had a baddie (BK, CO, etc) on their report, and now it is no longer reporting.

I think that app sprees should only be done when you know why you are doing it ( what benefit it is to YOU) , have the credit score/reports/credit history to support the cards you app for, and are knowledgeable/realistic about what you can get or are most likely to be approved for. If you research before you apply, you can eliminate alot of wasted apps. Too many people have 600 scores with numerous baddies, or BK's and CO's and apply without researching whether a creditor is BK/CO friendly, and get upset that they were denied.

Most everyone on this forum are sort of "credit geeks" and likely do lots of things in regards to credit that the general public would not do. I can only speak for myself, because I have been down the bad credit road, and rebuilt my credit using information I have learned here.

This game we are playing is chess, not checkers and you need to have a strategy to play effectively.

Re: "App Spree" Logic..help me understand this.

Walt_K — Mon, 03 Sep 2012 16:00:06 GMT

Don't forget sign up bonuses. When a card is going to give you $500+ just for applying (and sometimes hitting a minimum spend) the inquiry(ies) can be well worth it.

Re: "App Spree" Logic..help me understand this.

webhopper — Mon, 03 Sep 2012 16:17:17 GMT

I went on an app spree in Feb so that I could pick up some cards that better fit my needs. Not every app spree results in toy limits.

I applied for: QT gas card - declined
Amex zync - approved npsl
Amazon chase - declined then approved on recon
amazon store card
Discover open roads - declined

I picked up 2 reallly nice cards in that spree; both of which I use now several times per week.
At the time of the spree my only card was discover... now it holds a hallowed place in my sock drawer and I pull it out when I want to book travel on expedia. Shop discover gives 5% cash back on expedia

In march I refinanced my truck and was pre approved for the visa. I got it with a 22k limit.

My available credit went from around 5k to over 35k

Keep in mind that not every app spree results in toy limits or are the result of uncontrollable urges. I had been in underwriting for a mortgage for 4 months. After the mortgage process and a lot of removal of innacurate info via rapid rescore; I felt like I was finally in a position to get cards to better fit my needs. Ive been known to send over 5k in spending through amex. I wouldn't have been able to do that before my spree.

Also take a look at tinuviels latest spree. I don't see any toy limits there.

As of march 2013 I will have only one HP on each report. That is the beauty of apping in sprees. The 1 Hp is coming from a mortgage refi that will literally save me over 10k in interest.

Its all part of one big strategy that I have which is to save money and live better

Re: "App Spree" Logic..help me understand this.

webhopper — Mon, 03 Sep 2012 16:21:25 GMT

Also; I dont think my app spree really harmed my relationship with discover. They've been with me since 1999. I really don't think they are going to dump me anytime soon. They've been with me through a divorce ; judgment; birth of a kid. Major things... they aren't going anywhere.

Re: "App Spree" Logic..help me understand this.

Anonymous — Mon, 03 Sep 2012 16:28:11 GMT

@Anonymous wrote:
@Anonymous wrote:
What's the reasoning behind applying for multiple cards at 1 time? How does this benefit your credit profile/score? How does putting your profile on alert with all of your lenders help you establish a good relationship? Also, how does having several 500$ - 1000$ limit cards help your purchasing power? Wouldn't your creditors be less like to extend you more credit if you have many "toy limit" cards. Doesn't this go against the old mantra "apply for credit as you need it"?

The It's possible my perspective's a bit different, as a rebuilder, than someone who's starting out fresh. I've also never actually gone on an app spree, FWIW.
But for me? I could care less about "purchasing power". Credit isn't money. True financial stability has very little to do with how much you've been invited to charge up, really. I just want some positive tradelines reporting. So a few cards with smaller limits would be fine for me. And honestly, I think the "apply for credit as you need it" has gone the way of the dodo bird. It's easier to get credit when you don't need it. Just ask anyone who's gone through any major life changes that left them short.
That said, I really don't understand folks who look to get as much credit as possible without being thoughtful about it. I can understand apping within a certain time frame so that in inquiries fall off at the same time, but if it's moved into the "binge" territory as drkaje mentioned? That's a little beyond the beyonds. But I can understand it. If you've gotten to a place, emotionally, where a getting credit card has become a status thing, rather than a plain & simple tool, then no wonder. These very boards have stories about people who app 20x at a stretch, or want a certain card just because. There was someone who wanted an Amex Platinum, just because...and he didn't care about the $450 AF, even though he had a fairly low income and couldn't use much of the rewards. Just wanted it.

I agree with this. I can understand getting several accounts that are easy to qualify for and have low limits as part of a rebuilding strategy; you want to have newly established clean tradelines reporting positive history. I can understand coming out of rebuilding mode and apping for better cards; I just went through that. I came out of rebuilding mode and apped for four cards on the same day -- for me, this is a full-blown app spree. But, each card has a specific purpose in my wallet and is a card that I want to keep long term. In this case, I believed that getting them all at once and allowing them to age together made sense. But getting cards just for the sake of getting cards? This doesn't make sense to me. I like my cards to have purpose and to make sense in the context of an overall credit portfolio.

Re: "App Spree" Logic..help me understand this.

LS2982 — Mon, 03 Sep 2012 16:57:03 GMT

@Walt_K wrote:
Don't forget sign up bonuses. When a card is going to give you $500+ just for applying (and sometimes hitting a minimum spend) the inquiry(ies) can be well worth it.

Very good point!!!

Re: "App Spree" Logic..help me understand this.

marty56 — Mon, 03 Sep 2012 19:46:33 GMT

@Anonymous wrote:
I'm still pretty much convinced slow and steady wins the race but have probably suffered at times for being too conservative.

If I could go back in time, I would have never applied for my 2nd CC after the first one. I view app sprees like cheating on a diet. After your first bowl of ice cream, the 2nd one is much easier to justify andf goes down just as good.

Re: "App Spree" Logic..help me understand this.

webhopper — Mon, 03 Sep 2012 20:01:18 GMT

Rofl @ Marty! So true!

Re: "App Spree" Logic..help me understand this.

ACsteel — Mon, 03 Sep 2012 20:15:05 GMT

@Anonymous wrote:
What's the reasoning behind applying for multiple cards at 1 time? How does this benefit your credit profile/score? How does putting your profile on alert with all of your lenders help you establish a good relationship? Also, how does having several 500$ - 1000$ limit cards help your purchasing power? Wouldn't your creditors be less like to extend you more credit if you have many "toy limit" cards. Doesn't this go against the old mantra "apply for credit as you need it"?

These are all somewhat rhetorical, but I really don't understand the thought process behind it. There are several people on the credit board that go on these sprees only to end up "laying" these very low limit cards to pasture, out growing the lender or CL, etc.

I'm fairly new to the credit game..as many of you probably have history longer than i've been alive...so, there maybe something I'm missing...help me understand?

Yes you are actually right, going on an app spree is not a good idea, you should just apply for credit with a prudent sense of what you need and build your loyalty and credit with that company to have good credit history, hence the word "history". The credit game is a game you have to play wisely, but some people make foolish decisions getting a mass number of cards that ends up back firing on them. If the time is right, such as your inquiries are low, and your credit/financial grounding is good, then try for a card or two or try to upgrade your existing cards via credit limits or product changes.

Re: "App Spree" Logic..help me understand this.

Revelate — Mon, 03 Sep 2012 20:51:42 GMT

@angelnyc wrote:
@Anonymous wrote:
What's the reasoning behind applying for multiple cards at 1 time? How does this benefit your credit profile/score? How does putting your profile on alert with all of your lenders help you establish a good relationship? Also, how does having several 500$ - 1000$ limit cards help your purchasing power? Wouldn't your creditors be less like to extend you more credit if you have many "toy limit" cards. Doesn't this go against the old mantra "apply for credit as you need it"?

These are all somewhat rhetorical, but I really don't understand the thought process behind it. There are several people on the credit board that go on these sprees only to end up "laying" these very low limit cards to pasture, out growing the lender or CL, etc.

I'm fairly new to the credit game..as many of you probably have history longer than i've been alive...so, there maybe something I'm missing...help me understand?
Yes you are actually right, going on an app spree is not a good idea, you should just apply for credit with a prudent sense of what you need and build your loyalty and credit with that company to have good credit history, hence the word "history". The credit game is a game you have to play wisely, but some people make foolish decisions getting a mass number of cards that ends up back firing on them. If the time is right, such as your inquiries are low, and your credit/financial grounding is good, then try for a card or two or try to upgrade your existing cards via credit limits or product changes.

I posted an analysis a while back with some math; however, I fully agree with you that cards which aren't really going to be used, aren't worthwhile. I also agree that building a relationship with individual lenders is important, and pretty much all of us have finite financial resources which limit the number of tradelines which can be reasonably utilized.

That said, if there's a tradeline that you want, it behooves you to acquire it as soon as possible. If there's say 3 cards you want (in my case, that would be Amex BCP, Chase SP, and BOFA Travel Priveleges... maybe USBank Cash+ for a fourth) and if I had the credit profile to be approved for them, it's way better for me to just establish them all in one shot when we're talking about how one's future credit report looks even one year out, let alone 2-3 years out.

Above all, you're right in suggesting one has to have a plan, and I'm starting to be a big proponent of PC's as well (about the only reason I'm considering a Freedom right now), but if you're going to want a tradeline, and you can get approved for it now, unless there's a big-ticket item in the nearish term (mortgage, maybe auto) just go get it now; one's report, and therefore FICO score, will appreciate it later.

Re: "App Spree" Logic..help me understand this.

Open123 — Mon, 03 Sep 2012 21:38:58 GMT

The main reason for bunching apps together is for the inquiries to fall off (24 months), and to no longer count (12 months) on credit scoring. Moreover, the sooner you have accounts opened and aging (assuming you'd want to keep them), the better off your scoring will be in the long run.

For me, when my creditors review my profile, I want it readily apparent to them on manual review that I've got plenty of other options with whom I can do business. Also, I want them all to see that I've got a history of closing accounts without hesitation.

Re: "App Spree" Logic..help me understand this.

improvingmycredit — Mon, 03 Sep 2012 22:22:39 GMT

I'm not a proponent of "app sprees". I do however believe that those starting out with credit are going to accumulate inqs trying to just get started with the lenders out there. I think apping specific strategic credit lines at once really benefits the newbe in that the apps are all accumulated at once and fall off at once. Also the accounts approved all age together setting a better base for AAoA because subsequent later accounts will hurt less as the credit profile grows. Assuming that later apps are also strategic and targeted to an individuals needs later in life. JMHO.

Re: "App Spree" Logic..help me understand this.

Middleswarth — Tue, 04 Sep 2012 02:28:25 GMT

I have no problem with app sprees as long as you have a plan. Back in July I apped for 14 cards. I had a list of over 20 that I was interested in. I divided the list into categories and basically apped each card until I got one in each category. I got 3 store cards for stores I actually shop at, I got an American Airlines card which I use (6 months no interest for every purchase over $150 - can't beat that), I got a Visa, MC, and Discover. I then reconned a few and got one duplicate (US Air Ways). My CL increased from $1000 to $21000 in one afternoon!

I did this spree after 8 months in the garden with my 2 Cap One cards. I've since closed on of the Cap One cards and plan to close the other in a week or 2.

I ended up with a couple really nice cards (NFCU and USAA) as well as my foot in the door with Discover and GE.

The method to my madness is simple. All the INQ will fall off completely in 2 years and my AAoA will be better (all cards age together). My plan is to purchase a house after my report is clean. Had I not done the app spree, I would not have either not started my relationship with all these companies before my house purchase or my report would not be as clean as I want when I app for the mortgage.

IMO, app sprees work as long as you have a plan. If you app just because you have an itch, you don't have a plan. You have a problem.

Re: "App Spree" Logic..help me understand this.

Anonymous — Tue, 04 Sep 2012 04:38:59 GMT

On iPad so forgive formatting. I personally think app sprees make sense if well planned. Have to assume cards are ones you want/use. Otherwise not worth it. With new cards, you lose points from inquiries, reduced aaoa, and new account. So lets compare app spree vs. Spread out. Inquiries hurt you for up to 1 year. Hits from inquiries go down after 3-4 one if not before. However you will hit a wall with auto rejections if you have too many. Aaoa reductions are basically thesame in all cases. Please remember aaoa seem to round down so you can calculate post app aaoa. Might be worth spreading out apps because you can app so aaoa doesn't reduce below rounding. Finally with new account hit. It is temporary thing that lasts around 6 months. It seems to be the same whether it is one account or multiple accounts. So app spree seems to have advantage here.

The main reason for app sprees is that you can control your score a lot more. You can plan and set up optimal utilization fico wise. Yes new apps see the inquiries but they don't see the new approvals. aaoa will take hit, but apps would not see aaoa drop as all apps will be in before any new accounts show up. No new account hit for same reason. Inquiry hit is down to a few points after a bit. Mostly though a good app spree shows you did our planning and understand which cra might get pulled and can optimize that as well.

Re: "App Spree" Logic..help me understand this.

Anonymous — Tue, 04 Sep 2012 14:45:40 GMT

Just did my first app spree ever over the past couple weeks to upgrade my old Capital One cards. Ended up with 368,000 airline miles/points (many of which could be converted to cash), $750 cash, and an extra $120k in revolving credit lines. Not sure what the "500-1000 limit" thing is about...averaging it out my average limit on new cards is probably $13k, but that's because two cards were $7k limits despite many others being $13k and $16k limits.

My previously best (and only) rewards card was the GM rewards card, which did nothing for me as I wasn't planning on buying a GM car anytime soon. My previous highest credit limit was $3,500.

Now I have AMEX Starwoods personal/business card, Chase Sapphire/Freedom, Penfed Plat Rewards/Travel Rewards, Citi AA Visa/AA AMEX, and others. Now my highest limit is now $16,000 (one of the AMEXs) and I'm reasonably sure they'll bump that to $25k in 61 days.

So, my logic was that I wanted rewards cards, points, miles, cash, cards with nice limits that I didn't have to watch every second if I made a semi-large purchase, and a large amount of revolving credit.

Oh, and my FICO score (via scorewatch) didn't even go down a point from new inquiries. Though it did go up presumably from a decrease in utilization to 1% from 11%. Though the decrease from getting 2 inquiries on EQ may have been offset by the utilization.