Please explain the "app spree" theory

[Cloudlb]

Could someone please explain the theory and practice behind an "app spree?"  Is there some benefit to multiple applications at one time?  Is there a timing issue or restriction?  I'm just at the point where I want a couple more cards, and am wondering about the right way to go about it. 

My bigger question is why people apply for more and more cards, but I think that is more of a philosophical or emotional issue, ha!

[niecy357]

I went through this and got in trouble. Emotional for me yes. I was so excited about being approved; an adrenaline rush, that I continued to apply until I was denied. When you have that many cards and you can always find something to buy. I believe if you do not have the self control its causes destruction. I learned the hard way and now digging my way out. I have 3 cards closed the rest and if I cannot pay for what I charge at the end of the month; guess what??? I can't afford it! I have not applied for anything in years.

[Themanwhocan]

A hard pull (HP) credit inquiry reduces your credit score slightly on the one or more reports they pull. The impact of this happens immediately (they are asking the credit bureau for the data, so obviously the credit bureau knows about it immediately).

A HP can be done for various reasons. Trying to get a CLI and failing. Trying to get a CLI and succeeding, etc. So there is no impact on your FICO scores other than for the HP, and even then, only on the credit bureaus that were pulled. 

NOW... if you try to get a new credit card, you get that HP ding to one or more reports. Then congrats, you got the card! eventually the credit card company has to report that new credit line to ALL of the credit bureaus, but that takes time. But when it happens, you get another ding to your credit score. But this time, the ding is on all your credit reports.

Therefore, it is advantageous to apply for multiple cards all at once, since the new credit lines don't appear on your reports until later, so your FICO scores will only be going down because of the inquiries, and with a bit of luck those might be spread out amongst the various credit bureaus anyways. So It may increase your chances of being approved, and it might increase your chances of a bigger starting limit, etc.

And if not, you didn't lose anything for trying...

[GFer]

One reason I do so at the same time is so the inquiries age off together.  Some folks do it so that the inquirie(s) don't affect the other application.

[Cloudlb]

so . . . it IS  timing thing.  Makes sense.

and Niecy -- understood, but that's a problem with credit cards in general, I think; maybe with some self-esteem issues? 

[gdale6]

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@Themanwhocan wrote:

A hard pull (HP) credit inquiry reduces your credit score slightly on the one or more reports they pull. The impact of this happens immediately (they are asking the credit bureau for the data, so obviously the credit bureau knows about it immediately).

A HP can be done for various reasons. Trying to get a CLI and failing. Trying to get a CLI and succeeding, etc. So there is no impact on your FICO scores other than for the HP, and even then, only on the credit bureaus that were pulled. 

NOW... if you try to get a new credit card, you get that HP ding to one or more reports. Then congrats, you got the card! eventually the credit card company has to report that new credit line to ALL of the credit bureaus, but that takes time. But when it happens, you get another ding to your credit score. But this time, the ding is on all your credit reports.

Therefore, it is advantageous to apply for multiple cards all at once, since the new credit lines don't appear on your reports until later, so your FICO scores will only be going down because of the inquiries, and with a bit of luck those might be spread out amongst the various credit bureaus anyways. So It may increase your chances of being approved, and it might increase your chances of a bigger starting limit, etc.

And if not, you didn't lose anything for trying...

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Not everyone actually receives a ding when the new account reports as its ding can be overcome with the heavier weighted utilization category.

[emptypockets]

I think the logic behind a spree is whatever damage to AAoA (or for new INQ's) on your report will be minimized by all apps occurring around the same time, and the accounts and INQ's aging at the same time. For example, if you app once every 3 months, you will always have a new(er) account showing on your reports. INQ's appear in "real time" (i.e. they pretty much show on your report as soon as you app) so the theory of other creditors not "seeing" them if you do a spree doesn't really work here.

That being said, I have done a couple of sprees and I have tried to focus on apping for cards that pull different bureaus as well to limit the effect. So for example you might app for a card from Barclays first (they pull TU, and are INQ sensitive), then Chase Freedom or Discover (EQ pullers, although Chase may pull TU); then AMEX, CITI, or BOA  (usually EX pullers). The logic behind this is even though INQ's post to reports instantly, the CCC's may not see the other INQ's because they are pulling a different burreau.

There is always the urge to app for some people (myself included). But apping is different from spending. The knowledge that I cannot pay for some things by the end of the month makes me not spend, but spending is different fore everyone. In the end, everyone needs to make the best decision for themselves, and if that means no new cards, so be it.

[bobbay]

I spoke with support at myfico and they mentioned that when apps are clustered not only do other companies  not see new accounts on your report yet but inquiries are clustered into one inq for scoring purpose because the Algorithm looks at it like you may be shopping for a BT offer.  It has been mentioned several times here that auto inquiries are grouped like this however, this was the first time it has been mentioned to me that credit card inquiries on a CRB in a time window are grouped into one INQ.

[Themanwhocan]

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@gdale6 wrote:

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@Themanwhocan wrote:

A hard pull (HP) credit inquiry reduces your credit score slightly on the one or more reports they pull. The impact of this happens immediately (they are asking the credit bureau for the data, so obviously the credit bureau knows about it immediately).

A HP can be done for various reasons. Trying to get a CLI and failing. Trying to get a CLI and succeeding, etc. So there is no impact on your FICO scores other than for the HP, and even then, only on the credit bureaus that were pulled. 

NOW... if you try to get a new credit card, you get that HP ding to one or more reports. Then congrats, you got the card! eventually the credit card company has to report that new credit line to ALL of the credit bureaus, but that takes time. But when it happens, you get another ding to your credit score. But this time, the ding is on all your credit reports.

Therefore, it is advantageous to apply for multiple cards all at once, since the new credit lines don't appear on your reports until later, so your FICO scores will only be going down because of the inquiries, and with a bit of luck those might be spread out amongst the various credit bureaus anyways. So It may increase your chances of being approved, and it might increase your chances of a bigger starting limit, etc.

And if not, you didn't lose anything for trying...

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Not everyone actually receives a ding when the new account reports as its ding can be overcome with the heavier weighted utilization category.

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That is Correct, your FICO can go up, in spite of that minor ding. Its just that a major increase can overwhelm the negative  

[Anonymous]

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@bobbay wrote:

I spoke with support at myfico and they mentioned that when apps are clustered not only do other companies  not see new accounts on your report yet but inquiries are clustered into one inq for scoring purpose because the Algorithm looks at it like you may be shopping for a BT offer.  It has been mentioned several times here that auto inquiries are grouped like this however, this was the first time it has been mentioned to me that credit card inquiries on a CRB in a time window are grouped into one INQ.

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I find that really surprisingly (as in "not likely to be true")!   Lots of people have done multiple app sprees and never noticed that.