Best avenue for lowering CC usage percentage.

Anonymous · ‎01-12-2020

My story starts with the financial suffered in the financial crisis. My wife and I had a businesses that tanked, couldn't pay mortgage. Long story short, I short sold the house, and filed chapter 7. This was Dec. 2012. We closed the businesses, I went to the oil field in ND to rebuild the empire, and my wife went back to school to become an accountant (which we paid cash for).

Due to the fact I went into the oil field and making plenty of money, and being sour at myself about CC's and the BK, I paid cash for everything and never got back into the CC rat race. I'm now wishing I did, but oh well, have to start somewhere.

After the BK my credit history is as follows.
- Received a $25K loan in 2015 for a vehicle and paid it off in 16 months.
- We bought a house in 2016 and lived in it for 2 years, sold it and bought another house. Never late on a mortgage payment since the Chapter 7 BK.
- I applied for a Capital One Venture in Sept. 18 and received a $10K SL. That was increased in Oct. 19 to $14,500.
- I applied for a Capital One Spark for Business in Feb. 19 that has a SL of $10K.
- All CC paid on time and most of the time we pay them off in full. Currently have about 1K that we are carrying over and that will be paid off by the end of the month (Jan 20). My current credit usage is around 25-29% month to month.

- I have one collection ding that should have never been sent to collections. I have disputed this over and over and it appears it is going to be removed from my Experian finally. Still working on the others.

Currently my scores are :
Experian - 685
Equifax - 716
Transunion - 715

I am now looking for advice from you on the following.

1 - Increase my FICO score
2 - lower my CC usage % overall

Current credit card usage.

I use the Venture card to pay for all of our living expenses with the exception of the mortgage (anyone know a trick around that?). We are trying to build points for free airline travel yearly. We spend about 4-5K month on it. I had a small business (closed now) which is why I got the Capital One Spark for business. This spending limit does calculate on my SL total. I use this card for my current new job travel expenses. I get cash back on that card and spend about 2-5K a month on that. I always have about $6-8K on my cards of $24,500 available, so I'm about 28-32% utilization.

My current plan for lowering credit utilization % is to apply for another rewards card to up my available SL. I will let the CO Spark sit idle since it has no annual fee and begin to use a new rewards card for work. I am black balled from AMEX because they were included in my ch 7. I tried for the Chase Reserve but they want to see more payment history. Which card would you guys suggest and is this even the right route to go? I've considered trying to find a rewards card for my wife and having the living charges go on that card, whic would lower my CC utilization %. But I'm shooting at any idea right now.

What should be my plan for my FICO score?

Anonymous · ‎01-12-2020

Welcome to MF forum.

30% UTI on 25k TL is about 7.5k balance, which is not high. Venture is an okay card, but paying the AF for a 2% reward is not optimal. Paying mortgage with credit card is possible, you can check plastiq and see if and how it may work for you.

I agree getting more cards will help with UTI, do plan this out, don't rush, there are alot of app restrictions from chase, amex, citi, wells fargo.

Check pre-qualify site from chase, amex, cap 1, etc. Most people would start with chase freedom, discover It card, and citi double cash, as they provide some good cash back options and a good baseline earning.

To optimize for travel reward, you want to provide some numbers in your spending categories, airlines you fly, so we can better assist you.

Gmood1 · ‎01-12-2020

Definitely time to increase the TCL a little.
I'd look at some of the Credit Unions that offer membership nation wide.

Some offer pretty nice rewards cards.
Plus they can be a little more lenient to past credit issues IME.

1-9% util is optimal for scoring.
Though I also have one CC currently reporting at 35%. My overall utilization is 1%.

Anonymous · ‎01-12-2020

Airlines -

My travel situation. Currently my company is letting me pay for everything and reimbursing. My company wants me to take the cheapest flight since the customer is paying for them. Because of cost, its difficult to be loyal to one airline. However becasue of where I'm traveling it will likely be Delta, United, Alsakan in that order. Total airline travel spending around $15K for 2020

Hotels -

Unfortunately they want me to stay in 2 & 3 star hotels which limits the availability of nice brands such as Marriott or Hilton. So this puts me in IHG or Wyndam rewards. Total hotel spending is around $12-15K for 2020

Rental Cars - 12-15K for 2020

Dining while traveling - $6K

Anonymous · ‎01-12-2020

@Anonymous wrote:
Airlines -
My travel situation. Currently my company is letting me pay for everything and reimbursing. My company wants me to take the cheapest flight since the customer is paying for them. Because of cost, its difficult to be loyal to one airline. However becasue of where I'm traveling it will likely be Delta, United, Alsakan in that order. Total airline travel spending around $15K for 2020

Hotels -
Unfortunately they want me to stay in 2 & 3 star hotels which limits the availability of nice brands such as Marriott or Hilton. So this puts me in IHG or Wyndam rewards. Total hotel spending is around $12-15K for 2020

Rental Cars - 12-15K for 2020
Dining while traveling - $6K

If you have lot of layovers and would like to use lounge frequently, take a look at amex platinum + Gold. Citi prestige or chase sapphire reserve may be worth checking out too. There is alot of AF with these "premium cards", so do your own math and see if it works for you.

If you usually don't have long layovers and you don't use lounge, take a look at either amex green, or citi premier, or wells fargo propel + wells fargo visa signature. These have low or no AF and have good earnings. For wells fargo combo, you do need either time, or an extra person to complete it due to app rules of wells fargo.

One thing worth considering is chase sapphire reserve and preferred, albeit low on earning rate, do provide primary rental car damage waiver, since you rent car alot, this may comes into play.

Anonymous · ‎01-12-2020

@Anonymous wrote:
@Anonymous wrote:
Airlines -
My travel situation. Currently my company is letting me pay for everything and reimbursing. My company wants me to take the cheapest flight since the customer is paying for them. Because of cost, its difficult to be loyal to one airline. However becasue of where I'm traveling it will likely be Delta, United, Alsakan in that order. Total airline travel spending around $15K for 2020

Hotels -
Unfortunately they want me to stay in 2 & 3 star hotels which limits the availability of nice brands such as Marriott or Hilton. So this puts me in IHG or Wyndam rewards. Total hotel spending is around $12-15K for 2020

Rental Cars - 12-15K for 2020
Dining while traveling - $6K

If you have lot of layovers and would like to use lounge frequently, take a look at amex platinum + Gold. Citi prestige or chase sapphire reserve may be worth checking out too. There is alot of AF with these "premium cards", so do your own math and see if it works for you.

If you usually don't have long layovers and you don't use lounge, take a look at either amex green, or citi premier, or wells fargo propel + wells fargo visa signature. These have low or no AF and have good earnings. For wells fargo combo, you do need either time, or an extra person to complete it due to app rules of wells fargo.

One thing worth considering is chase sapphire reserve and preferred, albeit low on earning rate, do provide primary rental car damage waiver, since you rent car alot, this may comes into play.

Unfortunately, I cant apply to AMEX because they were charged off in the Ch 7. I'm on the dreaded lifelong blacklist. I tried for the CSR but they want to see more payment history before they give it to me. I would assume the Chase sapphire Preffered would be the same result? I would love the lounge access which is why I applied to both. Knowing the 5/24 chase rule, whatever card I go for I need it to be approved and beneficial to me (including a good SL hopefully). I have 3 inquiries in the last 2 years.

Couple questions - If I called the Chase begger line again, could I have them apply my CSR application towards a different credit card, like the preffered without them hitting my credit again?

Another idea is to get a rewards card for my wife with a sign up bonus, and move all the spending to her CC. Which would open up room on my CC utilization. If I did this, my utilization would drop to 12% or lowerwithout adding a card. Thoughts? I assume I have a better chance at another card if my utilization is low?

Gmood1 · ‎01-12-2020

I'd recommend joining Penfed. Wait until the Penfed Pathfinder Amex comes back online before you do.
Looks like their updating the rewards on the card at the moment.
That's if you want a Travel CC that runs on the Amex network.

Anonymous · ‎01-12-2020

Sorry somehow I missed your info on amex.

I don't know if recon is able to move your app to csp without a HP, someone with more experience can anwser that. Although I don't see another INQ being that terrible, considering you had just 3 and some will drop off report soon.

Moving spending to your wife'cc will drop your uti, which will then improve your fico, Im guessing by 10-15 points. It is a boost, but not sure its gonna be big enough a boost to change the outcome on csR app.

You can also just try to get a citi premier, then after a year, pc it to a prestige. Citi is pretty generous on CL, and premier is a pretty good card.

Gmood1 · ‎01-12-2020

Fair warning, Citi's SLs normally aren't world shattering. The cards do grow in time. But no where near as fast as others I've experienced.
Citi's average SLs are around $5k.
They are great for approving new lines, once you show some payment history and use.
It's not out of the question for Penfed or NFCU to start off in the $20k range.

Most newbies here gravitate towards the banks they've seen or heard of on TV.
If you want better SLs. You'll likely find that with the institutions that don't do a lot of commercials or advertising.
Many of them you've probably never heard of OP.

kerplunk · ‎01-12-2020

OP, some general financial advice: don't pursue rewards until your debt is paid off (or you aren't paying interest on debt).