topic Re: Should i accept an offer for a second credit card? in General Credit Topics

Should i accept an offer for a second credit card?

MikeRebuild — Thu, 03 Apr 2014 15:05:44 GMT

I had a BK over 4 years ago. my credit score was at 630. now it is at 681. I currently have a car lease and i want to lease a BMW next january when this lease expires. My total credit available is 3300 (over 3 cards). One of my credit card companies just offered me a second card with a 500 dollar limit. i am not sure if i should accept this or not? if i accept it will it lower my FICO score? will it improve my credit?

Any help would be much appreciated.

Thanks

Re: Should i accept an offer for a second credit card?

AeroKrix — Thu, 03 Apr 2014 15:25:55 GMT

Great job rebuilding!

i think the question is, what CC company? How would the card benefit you? Rewards, low interest? It sounds like a First Premier or CreditOne card...I sure hope it's not either

but, adding a new trade line will lower your AAoA, but increase your overall UTL. But if you already using <10%, the new limit would not help increase your score, but time will heal your fall as the CC ages.

Re: Should i accept an offer for a second credit card?

Anonymous — Thu, 03 Apr 2014 15:47:12 GMT

It may lower your score because of the new tradeline and the reduced AAoA.

If it's only $500 to add to your $3300, then I'd skip it.

You don't need more cards to optimize FICO scoring or qualify for a mortgage -- three is enough.

Re: Should i accept an offer for a second credit card?

MikeRebuild — Thu, 03 Apr 2014 15:57:41 GMT

It is with credit one (i also have first premier!). They both are lousy in a lot of ways but its been the cornerstone to my rebuild.

so is your vote to skip it?

thanks

Re: Should i accept an offer for a second credit card?

AeroKrix — Thu, 03 Apr 2014 16:03:16 GMT

Oh please skip it! Even though it's your second card with them, you still have to pay all those nonsense fee's. You're better off opening a secured card with that money you're going to spend just to open a credit one/first premier card.

i know how tempting a new unsecured card is... That's how I fell for Credit one and First Premier. But, secured cards can help you achieve the same success of building credit for less money.

Re: Should i accept an offer for a second credit card?

JustinS — Thu, 03 Apr 2014 18:14:20 GMT

First premier was a good rebuilder for me but with how credit one has no grace period (charges interest from the day you charge anything).... I'd definitely skip it. Best thing you can do at this point if you're serious about rebuilding your credit is (if your inquiries are reasonable) look for decent unsecured lenders who will approve with fair credit. Ones that come to mind (that I started with awhile back): Cap One and Barclays (Average Credit) - there are others as well. Work on rebuilding as you have been (good job getting to 3300 CL btw) and don't go backwards with grabbing up more cards with fees involved (I finally got rid of my last AF - Cap One EO perm waived it for me on the QS1).

Re: Should i accept an offer for a second credit card?

MikeRebuild — Thu, 03 Apr 2014 18:39:40 GMT

Justin,

Thanks so much for the response. My reasoning for accepting the second credit card from credit one is this: it would add 500 to my credit line without a credit inquiry on my report (i have no inquiries now) . Even though they are a lousy card, i was wondering if the extra 500 would help rebuild credit at all. but my concern is that it would actually lower the score - maybe it would lower the AAoA and that would lower the score? if it would raise the score, it might be worth it?

Re: Should i accept an offer for a second credit card?

Anonymous — Thu, 03 Apr 2014 20:08:02 GMT

@MikeRebuild wrote:
Justin,

Thanks so much for the response. My reasoning for accepting the second credit card from credit one is this: it would add 500 to my credit line without a credit inquiry on my report (i have no inquiries now) . Even though they are a lousy card, i was wondering if the extra 500 would help rebuild credit at all. but my concern is that it would actually lower the score - maybe it would lower the AAoA and that would lower the score? if it would raise the score, it might be worth it?

The lowered AAoA and new tradeline are likely to lower your score.

The extra $500 won't boost your score unless there's some angle with current high utilization.

Re: Should i accept an offer for a second credit card?

MikeRebuild — Thu, 03 Apr 2014 20:10:45 GMT

No, there isn't high utlization. its about 12%. I think that seals the answer: there is no reason to accept it.

Thanks!

Re: Should i accept an offer for a second credit card?

AndySoCal — Thu, 03 Apr 2014 23:55:44 GMT

I agree with the advice already given. I would consider at some point in time getting a card with less fees than First Premier or Credit One. You may want to wait until after the auo lease is completed.

Re: Should i accept an offer for a second credit card?

takeshi74 — Fri, 04 Apr 2014 12:38:01 GMT

@MikeRebuild wrote:
My reasoning for accepting the second credit card from credit one is this: it would add 500 to my credit line without a credit inquiry on my report (i have no inquiries now) . Even though they are a lousy card, i was wondering if the extra 500 would help rebuild credit at all.

While we can't guarantee what your score would be before and after you can calculate your utilization and AAoA before and after to help you in your decision making.

@Anonymous wrote:
You don't need more cards to optimize FICO scoring or qualify for a mortgage -- three is enough.

Re: Should i accept an offer for a second credit card?

roniram — Fri, 04 Apr 2014 19:55:16 GMT

If your scores are in the 680 range, I would think your could qualify for near prime cards. You can go to Barclay's site and Cap One's site and do a pre-qual to see what you might qualify for. I would get rid of the Credit One card as soon as you can. It is a good starter card, but whe you can qualify for others, its the first I would ditch. I just did a few months ago.

Re: Should i accept an offer for a second credit card?

Revelate — Fri, 04 Apr 2014 19:58:30 GMT

I don't know BK-friendly lenders when it comes to credit cards, but there's likely one out there with the BK 4 years ago and 680ish scores not named FP nor CreditOne (nor laughable Matrix card and the rest of the similar ones).

If you're going to get a new account, see about transitioning to a much better card than the ones you have now, a second CreditOne doesn't do anything for you and limits are one of the least important things in the FICO algorithm anyway: they're just for convenience frankly and can be managed in other ways.

Re: Should i accept an offer for a second credit card?

RobertEG — Sun, 06 Apr 2014 08:37:58 GMT

While secondary to the issue of whether you even want the card, a consideration that would apply to any decision related to an usolicited offer for credit, is whether the offer is consdered a "firm offer" under the FCRA.

An offer becomes firm if their offer was sent based on havng obtained your name from a CRA.

If you bite and actually apply, they must honor the firm offer if your CR and other information at their disposal shows that you continue to meet their specified criteria.

However, if your name was not obtained via a prescreeniing listing obtained from a CRA, their offer is not a firm offer.