Credit Card Utilization Question

Anonymous · ‎04-29-2017

I have a question about cc utilization. So on April 13th our ac/heating unit in our home had to be replaced because it was 18 years old and leaking freon and we have lived in our home 10 yrs. We are also thinking about selling it which was the plan before the unit went out, now not so sure. Anyway we had to finance the ac/heating unit through wells fargo since this is the bank the ac/heating company uses. We were approved for there cc for $5,500 which is what the new unit cost so that new account is maxed out but the good news is there is 0% APR until the unit is paid off. So starting in June is when we make the 1st payment and I haven't seen it hit our credit reports yet, only where they did a credit check is showing.

So my 1st question is when can we expect to see this new account hit our credit reports and because it is a credit card but used only for this purpose and can not be used for anything else, will it hurt our utilization? Our 2 cap1 cards and 1 barclay cards have balances but they are not maxed out. Will this new trade line of $5,500 help the overall utilization or hurt us? Thanks

nbean · ‎04-29-2017

If it's truely a credit card, then it will hurt if it's maxed out at the get go. As soon as you pay it down to AT LEAST under 75%, then the pain will hurt less. Try to pay it to there, so you won't see too much of a score drop.

First Ent Visa $21,800, Nasa PLOC $10K, Nasa CC $10K, Citi DoubleCash $12,200K, Penfed Promise $6K, Penfed Cash Rewards $5K, Total Rewards Visa $20K Lowes $35K QuickSilver CapOne WM $20K United Chase VS $2,800 Hyatt Chase VS $2,800 TJMaxx Mastercard $8K Barclays Rewards $3,700, Pier One $8,500 Walmart MC $8K Kohls $3K, Overstock $8,900, Discover $8K, Home Depot $20,700, JCP $10K, Victoria's Secret $5K, Ballard $10K, WilliamsSonoma Visa $11K, Grandin $4K, Banana Republic Visa $6K, Avianca Vida $25K, BoA $15K,BoA 3-2-1 $7,500

Anonymous · ‎04-29-2017

It is an actual credit card but only for home improvement and only for use with the ac/heating company that we bought the unit from. You buy the unit from ac/heating company but you have to apply for financing that goes through wells fargo. Then the credit card or account is actually closed after the unit is paid for so its not a regular line of credit that we can keep on using, its only for the purchase of a ac/heating unit.

Anonymous · ‎04-29-2017

DH and I ended up with the home furnishings version when purchasing a new king memory foam mattress set for 2k. The salesman had explained it as though it were a loan, make monthly payments of $X over 36 months. It wasn't until after we were approved that we found out it was a credit card. Never ended up billing the card. However I did a bunch of research about the program and found this website. Hope it helps. Theres a FAQs section as well.

https://retailservices.wellsfargo.com/homeprojects.html

Anonymous · ‎04-30-2017

@Anonymous wrote:
DH and I ended up with the home furnishings version when purchasing a new king memory foam mattress set for 2k. The salesman had explained it as though it were a loan, make monthly payments of $X over 36 months. It wasn't until after we were approved that we found out it was a credit card. Never ended up billing the card. However I did a bunch of research about the program and found this website. Hope it helps. Theres a FAQs section as well.

https://retailservices.wellsfargo.com/homeprojects.html

Thanks Fluffybubbles for this info, I went to the link you provided and read it but it didn't really give me any info about whether or not we will see it report on our credit reports. I hope it doesn't. And you said that you financed a mattress and even though they sent you there cc, it was never actually billed for the amount your purchased? Did anything show up on your credit report as a new line of credit? Thanks

ChargedUp · ‎04-30-2017

Wells Fargo seems to be selling it as a credit card. This makes me wonder if WF has a private clearing network that contractors are signing up with in order to accept these cards. The above link shows an image of what the card looks like as well.

I probably would've apped for a Chase Freedom Unlimited or Citi Double Cash with 18 month Ø% interest and at least got some rewards for the $5500 purchase.

Anonymous · ‎04-30-2017

Yes we got a card for it and it shows on all 3 CRAs. It has no slide bar, just an account number on the front. In the FAQ it said it's a revolving account that can be used anywhere else that issues that same card, although we've never tried. It also looks like a regular CC on wells fargos app/online. I check from time to time to make sure nothing shady is going on with it, but other than that it just serves as a bit of utilization padding since DH has an unused $3100 CL with them.

I think it would be worth a phone call to find out if it will indeed close once paid off. If not it would help you for a while in the long run because you would have $5500 unused credit availible.

HeavenOhio · ‎04-30-2017

@Anonymous wrote:
DH and I ended up with the home furnishings version when purchasing a new king memory foam mattress set for 2k. The salesman had explained it as though it were a loan, make monthly payments of $X over 36 months. It wasn't until after we were approved that we found out it was a credit card. Never ended up billing the card. However I did a bunch of research about the program and found this website. Hope it helps. Theres a FAQs section as well.

https://retailservices.wellsfargo.com/homeprojects.html

That's the Home Projects card. I believe this one is the Home Furnishings card:

https://retailservices.wellsfargo.com/home-furnishings.html

The Home Projects card is a true revolver. Based on the description from the OP and what it says after following the link, it looks like the Home Furnishings card operates differently.

MyLoFICO · ‎04-30-2017

The real question is if you dropped $1k on it right now, would it still show 100% maxed after the payment hits or 80%? If the limit shrinks with each payment then it is an installment. If not, you need to get it refinanced elsewhere and pay that off. Maybe app a new card and call WF and PIF and tell them where they can stick that "credit card".

Experian: 677 (28) | TransUnion: 697 (27) | Equifax: 684 (6)
Gardening as of: 1-23-2018
Updated 1-25-18

Anonymous · ‎04-30-2017

We got pricing with several diff companies before deciding to go with the ac/heating company we chose and we can't pay for that type of repair in full at this time is why it was financed with wells fargo, when I asked the manager of the hvac company about the cc he said it can only be used with his company but im not 100% sure of that after reading wells fargo's site. Once it is paid off then it will either sit open with $0 or we will close it if we can't use it anyplace else. If we are able to sell our house then we can pay that bill in full out of money from our selling the house. I just hope it doesn't raise our utilization to the point that we won't be able to sell and buy another home in Sept which is 2 yrs from discharge date. We had no choice but to put a new unit in and its really bad timing.

Since it has 0% APR then each payment will drop the amount until its paid off, At least thats what we were told.