Opened lots of new accounts 15 months ago... what to do now.

[score_building]

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@JP-Photo wrote:

!. Merrick is a subprime lender, since already have more than enough better cards, can it when PIF. IMHO the account should be closed if for no other reason than to de-clutter and begin to get the unbridled app spree to make some sense in terms of spending (including how much are willing to pay to carry balances = interest. and force one to begin to fine tune the ways in which they wish to effectively utilize credit going forward) It's a miracle they didn't close it already as they are known to balk at too many new accounts and summarily close.

The only downside is this card has a higher CL than 3  other accounts, and it has the 3rd best interest rate if I do have to carry a balance.  No opposed to closing it, just waiting for the others to step up what they offer, which I'm sure will happen as my score goes up.

2. pay down balances as quickly as possible, avoid using credit to help others as a general rule. of course there may be exceptions, at your discretion but it quite often doesn't end well. you seem to assert using credit to help others will, in general, gain favor when it is much more likely to lead to default, if things head south; unless are willing and able to PIF the loans extended to others on credit. Think of it this way, If you have to borrow something to loan it to someone else, how frequently would it take to place oneself in this position before something went wrong? Ask me how I know.

I've got paid every month for the last 11 months straight, so I don't see it as an issue.  I literaly saved this person from bankruptcy in their business, they make a point to send me money before other bills, that are probably more important get paid.

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I guess one of the liabilities of the rapid fire app was high interest rates granted, but an upside is they're all aging nicely together. I incorrectly assumed Merrick would be one of the highest rate cards obtained. Only you can decide how to use credit, I just know from experience that it can end badly if overextended. In any case, am glad to hear the person is able and willing to repay am a big believer in "paying it forward" just not so much anymore if have to borrow what I can't PIF. If are willing and able to save anothers business from bankruptcy on personal credit that is admirable to say the least. 

[jamie123]

Okay...Here's my suggestion:

YOU NEED A PLAN!!!! A LONG TERM PLAN!!!

You eventually want to be in the 800 club, amirite? You need to look at people that are already in the 800 club and emulate them. You know what your credit profile looks like today and you need to make credit decisions from here on out to get you into an 800 club profile. These are some characteristics of someone in the 800 club:

6 to 8 quality credit cards with the AAoA at 10+ years

1 auto loan that has been paid on for a couple of years

1 or 2 old paid in full auto loans

A 30 year mortgage that has been paid on time for 20 years

That's it! It really isn't that hard and you can't force it. You just need to make sure ALL your payments are made on time and NEVER late. If you notice, the profile looks rather bland without much on it. Lenders LOVE bland.

In my opinion you will have a very difficult time in receiving CLI and CCs with high ($20K+) CLs just because you have too many credit cards and many of them are low quality. You need to close some CCs and focus on building good CLIs with the remaining cards. I don't want to beat a dead horse, but you really did set yourself back by apping for so many cards as others have mentioned here.

You have a misunderstanding about UTI. You keep stating that UTI should be kept below 30% and that is WRONG! It has been proven time and again on these forums that UTI should be kept at less than 9% and that ONLY ONE card should report a balance to maximize your scores. Your scores will jump quite a bit just by taking the UTI below 9%.

Okay, now on to what you need to do about these cards.

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@JP-Photo wrote:

So it's been about a year...

Paypal Extra's Platinum, Approved $1500 -> Now $2500 ($1800 bal)

Discover More, Approved $1000 -> No change ($100 bal)

Chase Slate Blueprint, Approved $2300 -> No change ($1800 bal)

Citi Dividen Platinum, Approved $4000 -> No change ($3200 bal)

Target Red Card, Approved $600 -> No change ($0 bal) Close this card.

BankAmericard, Approved $2000 -> Now $3500 ($800 bal)

Walmart Discover, Approve $1000 -> Now $1800 ($300 bal) I beleive this card can be used at Sam's Club also?

Merrick Bank, Approved $1500 -> No change ($700 Bal)Close this card.

Sams Club, Approved $1000 -> Now $1400 ($500 Bal) Close this card.

Home Depot Personal, Approved $500 -> Now $1500 ($0 Balance)Close this card.

Dell Preferred, Approved, $1000 -> No change (Never Used) Close this card.

New Accounts with last 12 months

Zales, Approved, $500 -> Now $1500 (Never Use)Close this card.

 Next logical step would be to close, open, request, transfer, wait.... 

FYI: As for balances and interest rates, this money was spent to help a friend from losing a business.  I get $1200 month to pay off these balances from them.  Other than how it effects my credit score it doesn't cost me personally.  Eventually they will all be $0 balance.

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I would suggest that you make sure each of these cards that you plan on closing is at least 1 year old before doing so. It will help you to look as bland as possible. Lenders don't like compulsive customers and when you open or close accounts it will bother them if/when they do a manual review of your reports. All these cards will remain on your reports for 10 years but will help with AAoA.

If you have any other cards you may want to consider closing them as well. MAKE SURE YOU DON'T EVER CLOSE YOUR OLDEST CARD, I DON'T CARE WHO IT IS WITH!!!

Garden your cards for 6 months! Get your UTI below 9%, watch your scores jump 20 points, and then stop back and thank the forum.

At 6 months from now you will be ready to app for an AMEX and you should be approved.

Don't apply for any more store cards! Only quality PRIME banks from here on out!

These are the banks that are considered PRIME by most members of this forum, and you have most of them already:

AMEX

Chase

CitiBank

Discover

Bank of America

Wells Fargo

Barclays (Maybe)

If you have a card with one of these banks (And you do!) you can expect to have CLs of $10K+ in a few years of demonstrated good credit behavior. They currently aren't giving you good CLIs because you have too many open accounts. You need to eventually end up with 6 to 8 really quality cards.

You are really in a good spot. Your scores should start to climb if you follow some of this advice. All you need to do is close some accounts and lower your reporting balances and you are golden!

[JP-Photo]

I guess one of the liabilities of the rapid fire app was high interest rates granted, but an upside is they're all aging nicely together. I incorrectly assumed Merrick would be one of the highest rate cards obtained. Only you can decide how to use credit, I just know from experience that it can end badly if overextended. In any case, am happy for you that in this case the person is able and willing to repay am a big believer in "paying it forward" just not so much anymore if have to borrow what I can't PIF. If are willing and able to save anothers business from bankruptcy on personal credit that is admirable to say the least. 

It's just one of those things you gotta roll the dice on and let people surpise you.  Plus it's helped me cycle more than I would ever use in 2-3 years through my accounts...

I don't know if I would do it again, it was definitely an experience..  These are all my Flights, 22,000+ miles racked up on Spirit.  I did have to drive a few times back and forth too.  Like with anything in life... YMMV

[RonDawg]

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@JP-Photo wrote:

Again we've already established what's done is done August 2011.  It's now 15 months later and I'm looking more long term from here.  I'm not looking to APP today, unless It's beneficial. just like I'm not looking to close an account unless it's viewed as beneficial, or do a HI for CLI unless it's beneficial.

As already mentioned the debt I have is work related expenses from helping some friends.  I choose to help people in the hopes maybe someday I'll need a favor and someone will be there to help me, like I've helped others.  On top of what I get paid for work, these expenses are also being covered.  I get roughly $1200 a month to cover these credit card expenses alone.  So they leaves 7-8 months til all accounts are PIF with $0 balance.

When all accounts are PIF or below 30%, what's the next step.... 

What to keep, what to close, what to app, what to CLI, etc etc...  

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Sorry I left for a bit, Listen you have had these accounts for a while right? closing accounts keep them open is your business.  If your never going to use the account then the creditor will close it for you in their due time.  If your going to use the credit card then keep it if your not then close it.  Interest rate only matters if your going to carry a balance if you pay in full each month then interest rate is only a number.   Advice is... If you don't need it and never plan to need it in the future then close it.  Every credit card you have needs to have a job if it does not then fire it.  Simple as that.  Keep in mind that if you have balances on your credit cards then closing an account will decrease the amount of available credit you have that in turn will raise your utl.  Higher UTL will lower your credit score.    So some credit cards though may not have a full time job but the job of lowering your utl is still a job.  You may want to think about that as well before closing an account.

[ccnewcc]

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@jamie123 wrote:

Okay...Here's my suggestion:

YOU NEED A PLAN!!!! A LONG TERM PLAN!!!

You eventually want to be in the 800 club, amirite? You need to look at people that are already in the 800 club and emulate them. You know what your credit profile looks like today and you need to make credit decisions from here on out to get you into an 800 club profile. These are some characteristics of someone in the 800 club:

6 to 8 quality credit cards with the AAoA at 10+ years

1 auto loan that has been paid on for a couple of years

1 or 2 old paid in full auto loans

A 30 year mortgage that has been paid on time for 20 years

That's it! It really isn't that hard and you can't force it. You just need to make sure ALL your payments are made on time and NEVER late. If you notice, the profile looks rather bland without much on it. Lenders LOVE bland.

In my opinion you will have a very difficult time in receiving CLI and CCs with high ($20K+) CLs just because you have too many credit cards and many of them are low quality. You need to close some CCs and focus on building good CLIs with the remaining cards. I don't want to beat a dead horse, but you really did set yourself back by apping for so many cards as others have mentioned here.

You have a misunderstanding about UTI. You keep stating that UTI should be kept below 30% and that is WRONG! It has been proven time and again on these forums that UTI should be kept at less than 9% and that ONLY ONE card should report a balance to maximize your scores. Your scores will jump quite a bit just by taking the UTI below 9%.

Okay, now on to what you need to do about these cards.

---

@JP-Photo wrote:

So it's been about a year...

Paypal Extra's Platinum, Approved $1500 -> Now $2500 ($1800 bal)

Discover More, Approved $1000 -> No change ($100 bal)

Chase Slate Blueprint, Approved $2300 -> No change ($1800 bal)

Citi Dividen Platinum, Approved $4000 -> No change ($3200 bal)

Target Red Card, Approved $600 -> No change ($0 bal) Close this card.

BankAmericard, Approved $2000 -> Now $3500 ($800 bal)

Walmart Discover, Approve $1000 -> Now $1800 ($300 bal) I beleive this card can be used at Sam's Club also?

Merrick Bank, Approved $1500 -> No change ($700 Bal)Close this card.

Sams Club, Approved $1000 -> Now $1400 ($500 Bal) Close this card.

Home Depot Personal, Approved $500 -> Now $1500 ($0 Balance)Close this card.

Dell Preferred, Approved, $1000 -> No change (Never Used) Close this card.

New Accounts with last 12 months

Zales, Approved, $500 -> Now $1500 (Never Use)Close this card.

 Next logical step would be to close, open, request, transfer, wait.... 

FYI: As for balances and interest rates, this money was spent to help a friend from losing a business.  I get $1200 month to pay off these balances from them.  Other than how it effects my credit score it doesn't cost me personally.  Eventually they will all be $0 balance.

---

I would suggest that you make sure each of these cards that you plan on closing is at least 1 year old before doing so. It will help you to look as bland as possible. Lenders don't like compulsive customers and when you open or close accounts it will bother them if/when they do a manual review of your reports. All these cards will remain on your reports for 10 years but will help with AAoA.

If you have any other cards you may want to consider closing them as well. MAKE SURE YOU DON'T EVER CLOSE YOUR OLDEST CARD, I DON'T CARE WHO IT IS WITH!!!

Garden your cards for 6 months! Get your UTI below 9%, watch your scores jump 20 points, and then stop back and thank the forum.

At 6 months from now you will be ready to app for an AMEX and you should be approved.

Don't apply for any more store cards! Only quality PRIME banks from here on out!

These are the banks that are considered PRIME by most members of this forum, and you have most of them already:

AMEX

Chase

CitiBank

Discover

Bank of America

Wells Fargo

Barclays (Maybe)

If you have a card with one of these banks (And you do!) you can expect to have CLs of $10K+ in a few years of demonstrated good credit behavior. They currently aren't giving you good CLIs because you have too many open accounts. You need to eventually end up with 6 to 8 really quality cards.

You are really in a good spot. Your scores should start to climb if you follow some of this advice. All you need to do is close some accounts and lower your reporting balances and you are golden!

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+1

[Anonymous]

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@ccnewcc wrote:

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These are banks that are considered PRIME by most members of this forum, and you have most of them already:

AMEX

Chase

CitiBank

Discover

Bank of America

Wells Fargo

Barclays (Maybe)

These are considered prime among the Big Banks. The most favorable Terms & Conditions will be found among smaller banks and credit unions. If you want prime search as you would a mortgage for low rates for purchases and cash advances. Rates are what credit cards are all about - not rewards, unless you can always PIF. Sometimes carrying a balance or a need for emergency cash requires a backup insurance card and the Big Banks don't fit that description. Remember rates and rates count.

[mmmagique]

Yes, people will surprise you. But often not in a good way.

You have too many card with high balances. You need to pay them off/down ASAP. 

As someone said earlier, you should only have one card reporting, and all the others at zero for maximum scores. But right now, that's not even an issue for you. You are over-utilizing your credit (imo) and that leaves you (and the cccs) vulnerable. You want to reduce your risk by getting those balances at least below 20% on each card. 

Don't max out your Zales card. Just...get her a nice promise ring, and "promise" her that when you've got your credit back under control, you will buy her a nicer one. Maybe after your friend pays you back all he owes? Btw, are you charging him interest? Because you're paying a ton. 

Good luck to you!

[JP-Photo]

Yes, people will surprise you. But often not in a good way.

This guy is a friend of a friend for over 20 years.  So far no problems and none forseeable.

You have too many card with high balances. You need to pay them off/down ASAP. 

This was a given as I've already stated within 6-9 months of the payments I'm currently posting about 2-5x min payments for each account, they will all be $0 balance.

As someone said earlier, you should only have one card reporting, and all the others at zero for maximum scores. But right now, that's not even an issue for you. You are over-utilizing your credit (imo) and that leaves you (and the cccs) vulnerable. You want to reduce your risk by getting those balances at least below 20% on each card. 

As noted above, in 6-9 months estimate all accounts $0 balance.

Don't max out your Zales card. Just...get her a nice promise ring, and "promise" her that when you've got your credit back under control, you will buy her a nicer one. Maybe after your friend pays you back all he owes? Btw, are you charging him interest? Because you're paying a ton. 

With an initial $500 limit, I wasn't gonna use it all.  I called and got it bumped to $1500.  The ring she liked was about $1000.  I was gonna wait another 6-12 months and see if I could get a $3000+ limit with zales (if I keep this account).  Like the idea of 0% for 12 months rather than paying out of my bank account... Which is why I like my BestBuy account, for all the 0% offers.  

As for interested, I'm not profitting from what they are buying, but the amount the pay is applied to each account each month and then I forward him the new balance that includes the interest for whats due.  So other than effecting my credit it's not costing me a penny.  All of my account balances are being paid in full by this person including all interested associated with them.  The only accounts I pay on are my 2 car loans which are 2.12% @ 60M and 3.04% for 72M which I had a cosigner with 840+ credit score on these so I doubt I could have found better rates at time of purchase withing having a USAA thing.

Good luck to you!

Thanks!

[JP-Photo]

Got approved for the Amex Platinum, goal achieved.  Still working on getting everything PIF and maintaining a $0 bal on the Amex Plat.

Card	Limit
American Express Platinum	NPSL
Merrick Bank	$1500
Target Red Card	$600
BankAmericard	$3,500
Chase Freedom	$2,300
PayPal Extras Platinum	$2,500
Discover	$1,500
Walmart Discover	$2,600
Best Buy	$800
Zales	$1,500
Citi Dividend Platinum	$4,000
Sams Club	$5,400
Home Depot	$3,000
Barclaycard (Apple)	$2,000
Dell Preferred	$1,000
Amazon Account	$1,200
Bill Me Later	$801

[drkaje]

Congrats on the Amex!

Intermeditely? I'd wait it out before trying to hit the next level. Here's why: helping the friend uglifies your utilization too much.

Long term, theres really no benefit to a bunch of lower limit cards.

For the doctorate time? You might really want to seriously reconsider having the extra debt floating out there. I'm back in school full time and the financial stress is unbelievable. Having it to do over again, I would have definitely found a better way before being too far along the path.