WHY?????

[Anonymous]

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Account age stats are definitely more important than an inquiry. Inquiries become unscorable after a year, and after two years, they're gone entirely. AAOA (average age of accounts) and AOYA (age of youngest account) are going to be affected over the long haul.

However, inquiries aren't entirely irrelevant. While lenders are likely to be more concerned about new accounts, they also may be concerned about recent inquiries to a somewhat lesser extent.

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While I agree that age of accounts stats are more important than an inquiry, I think it's worth noting that depending on those age of accounts stats an inquiry can actually have a more adverse impact on a credit score (granted, for only 1 year) than a change to age of accounts stats.

The time this would be true is if you take someone with a thick aged file that's opened an account recently already.  If their AoOA is already 17+ years, their AAoA is already 8+ years and their AoYA is a couple of months old due to a recent new account, none of those stats dropping slightly from adding another new account would likely impact score at all.  The inquiry however could impact score.  This is just an exception regarding this topic that I'd like to point out.

[Anonymous]

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@Anonymous wrote:

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Account age stats are definitely more important than an inquiry. Inquiries become unscorable after a year, and after two years, they're gone entirely. AAOA (average age of accounts) and AOYA (age of youngest account) are going to be affected over the long haul.

However, inquiries aren't entirely irrelevant. While lenders are likely to be more concerned about new accounts, they also may be concerned about recent inquiries to a somewhat lesser extent.

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While I agree that age of accounts stats are more important than an inquiry, I think it's worth noting that depending on those age of accounts stats an inquiry can actually have a more adverse impact on a credit score (granted, for only 1 year) than a change to age of accounts stats.

The time this would be true is if you take someone with a thick aged file that's opened an account recently already.  If their AoOA is already 17+ years, their AAoA is already 8+ years and their AoYA is a couple of months old due to a recent new account, none of those stats dropping slightly from adding another new account would likely impact score at all.  The inquiry however could impact score.  This is just an exception regarding this topic that I'd like to point out.

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This is very true for me. My AAOA is 9 years, My AoOA is 14 years  and my AOYA is  3 years 4 month (until the one that I did last month updated).  My score did not take a hit at all with the soft pulls through SCTs. I recently decided to apply for a card with a hard pull and it went down a few  points.  So the SCT works if you have years in the bank 

[SouthJamaica]

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@Anonymous wrote:

I just wondering, why most of the people love SCT or SP when trying to apply for a new credit card? They worry more about the new inquiry on their credit reports. I thought "inquiry" only have a small effect on Fico scoring model. Should we care more about AAOA?  Basically, either with SP, SCT or HP,  when a new account reported will lower AAOA, therefore will ding our score "more". Am I correct here? Please, advice Thank you.

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They should care about both.

[Brian_Earl_Spilner]

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@Anonymous wrote:

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@Anonymouswrote:
From what I’ve seen people don’t like HPs on their report. People have been denied for cards due to the amount of inquires they have. SP using the SCT for a store they already shop at is perfect.

Also just to reply to what game said above.... retail cards are perfect for someone rebuilding... just gotta watch out for that interest — never leave a balance on store cards ever! That $25 item is now $32 just because you didn’t PIF

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Yessss, I know but the score will get ding anyway when new account reported to CRA. Even tho it was approved by SP or via SCT. Also, Most lenders still can see there is "new account opened" recently even without HP inquiry show up that most people worried about

Plus if we talk more about famous Chase rules 5/24, No matter if you only have 2-3 HP inquiries on your CR but you open 8-10 new accounts via SP or SCT, Chase or most Lenders will be able to see it and still denied your application based new account opened regardless you only have 2-3 HP on your credit report.

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I took a 3-5 point hit per report for my latest app. Posted to my EQ today and got a 13 point score raise. And that was with it almost maxed from BT. My TU got a 12 point increase when the card reported to it less than a week ago.

[Anonymous]

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@Anonymous wrote:

Youre actually spot on.

SCT is really really stupid to do in the long term.  All you end up with in the long run is 10-50k worth of store cards for mostly overpriced things through a bank that will almost never transition those cards to open loop Visa or Mastercards.

On top of that, Transunion separates Retail Cards and Bankcards into two different categories for calculating Utilization ratios (i figured this out about four months ago the hard way) so you could have 40k worth of retail cards doing absolutely nothing to "pad" that 250/300 secured card you keep carrying a balance on.  That is on top of the individual utilization penalty.

No more than one or two retail cards, ever, and only at places you actually will use them at.  This should be a hard and fast rule.  Amazon makes sense, its a 5 percent off card for Amazon.  Target makes sense for the same reason.  Walmart is borderline as some general purpose cashback cards can beat it. 

But again, only good if you USE those stores.  SCT cards are from mostly mid to "highish" end outlet stores catering to people that want premium kitchen or living room sets for premium prices.  There is no way an 8000 CL Overstock card is more attractive than a 1000 limit Amazon card for that reason alone.  At least with the amazon you pay 5 percent less on the retail price.  With overstock youre normally paying 10-20 percent more from just their markup.

The three to five point loss from the hard inquiry on a good solid card wayyyyyy overshadows the 10-20 point age of account hit for thin profiles, nonwithstanding everything I just said.

On top of that, most people using SCT have really bad credit already.  Comenity is notorious for giving out 5k store card limits to subprime borrowers.  What will happen?  That borrower is going to charge up a fortune, get stuck in the 25 percent interest trap, and end up worse off than before.

Whats even worse, is that when you get to a certain point where you have cards with 6000+ limits and realize that store has a visa version, and you try to obtain that visa version, or for that matter ANY comenity Visa/Mastercard after you have open SCT accounts, comenity has a proven track record of closing every single account you have with them without any warning.

All of my comenity cards are perma sockdrawered and unused, and have been for quite some time now.  I dont care if comenity closes them.  They only exist now because they are positive tradelines and I have a very very thin AAoA already.

Do not SCT.  Take it from me.

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I think there are gross generalizations in this post that not true.  Amazon card does not give you 5 percent off unless you have prime.  Prime costs 12.99.  You would have to spend 259 dollars a month to get your prime member fee back much less earn any savings.  The Store cards give you discounts with no fees.  I dont' shop at Overstock but I do at J Crew, Express and Pottery Barn.  Pottery Barn gives you 12 months zero interest on purchases.   And these cards did help my utilization and helped me get better cards very quickly.  I went from having a 508 FICO and having no credit cards to having prime cards in 4 months.  

And why would I possibly want VISA/Master Card from Comenity?

[Anonymous]

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@Anonymous

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I think there are gross generalizations in this post that not true.  Amazon card does not give you 5 percent off unless you have prime.  Prime costs 12.99.  You would have to spend 259 dollars a month to get your prime member fee back much less earn any savings.

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Above you're only looking at one aspect of having a Prime membership/card and aren't taking into consideration any of the other benefits of the membership and/or the intangibles that can certainly make having it "worth it."

[Anonymous]

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@Anonymous wrote:

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@Anonymous

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I think there are gross generalizations in this post that not true.  Amazon card does not give you 5 percent off unless you have prime.  Prime costs 12.99.  You would have to spend 259 dollars a month to get your prime member fee back much less earn any savings.

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Above you're only looking at one aspect of having a Prime membership/card and aren't taking into consideration any of the other benefits of the membership and/or the intangibles that can certainly make having it "worth it."

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The person's post I was replying to was stating things like they are facts.  Amazon prime is paying for something extra.  So that should be clearly stated.  There are plenty of Comenity stores that I shop at more than I do at Amazon.  And they don't charge you any fees.  J Crew gives you free delivery to everyone and free tailoring if you have their card all for no "Membership fee".   Crate and Barrel gives you 6 month 0 percent financing. Pottery Barn gives you 12 month 0 percent.  J Crew gives you five percent back on purchases with card.  Plus you get 20 percent off your first and second orders in addition to any sale prices.  Express gives you 8 percent.   

I am not sure of why the hate of the store cards.  Surely better than a Capital One Platinum which I cancelled after 11 months.  Perhaps people at first could only get store cards and now they can get other cards and they feel the need to put them down to make themselves feel better.  

I used the 12 month 0 percent financing on a dinning table and chairs at Pottery Barn. They were having a sale plus I got a 20 percent off coupon for my first purchase.  

[Anonymous]

I'm not sure what your reply above has to do with anything regarding an Amazon Prime membership.  My statement has absolutely nothing to do with store cards and was only in response to your comment regarding needing to spend X with an Amazon Prime in order for it to justify the membership fee.  My point was that there are plenty of other benefits of having a Prime membership that can quickly make spending X irrelevant to possessing the membership with respect to the AF.

[Anonymous]

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@Anonymous wrote:

I'm not sure what your reply above has to do with anything regarding an Amazon Prime membership.  My statement has absolutely nothing to do with store cards and was only in response to your comment regarding needing to spend X with an Amazon Prime in order for it to justify the membership fee.  My point was that there are plenty of other benefits of having a Prime membership that can quickly make spending X irrelevant to possessing the membership with respect to the AF.

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Well that is you. To me they have no value.  I just thought it is important to note that you don't get the 5 percent off unless you pay another 12.99 a month.  If you are already paying 12.99 a month and feel satisified with what you get for that 12.99 than perhaps the 5 percent back is value to you.  But I don't see it as being frugal as you can get free shipping on Amazon without prime.  And I don't see their Prime Video being worth 12.99 a month.   I would consider Amazon Prime as a luxury service.  If you want to pay for it great but don't act like you are saving money. 

[Anonymous]

WALDT