Should I close/ask for a limit increase

[4MER2R0]

Morning All,

I'm looking for some advice on what to do with two credit cards.  

My FICO scores range from the low 770's to the low 800's depending on the formula you look at.  I would like to get my scores to the 800's and I am looking at my report.  I have four cards two with limits over 10k, one at 7k and one at 1.5k.  The last one is a couple of years old and we have been actively working to improve our scores over the last two years.  My credit utilization is right at 12%. I only have balances on two of the cards but I use and pay off the balance on every card monthly.  

My question is should I either close the card with the low balance or ask them for a limit increase?  I am going to be applying for a mortgatge in 2-3 months and would like to get the prime rate.  Because the card is not my oldest card and the balance is so low I don't now if the card helps, hurts or (I suspect) doesn't make much of a difference. 

Other data:
No missed payments/late accounts/public records, we have one mortgage for a house we rent out.  

Any suggestions?

[Anonymous]

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@4MER2R0 wrote:

Morning All,

I'm looking for some advice on what to do with two credit cards.  

My FICO scores range from the low 770's to the low 800's depending on the formula you look at.  I would like to get my scores to the 800's and I am looking at my report.  I have four cards two with limits over 10k, one at 7k and one at 1.5k.  The last one is a couple of years old and we have been actively working to improve our scores over the last two years.  My credit utilization is right at 12%. I only have balances on two of the cards but I use and pay off the balance on every card monthly.  

My question is should I either close the card with the low balance or ask them for a limit increase?  I am going to be applying for a mortgatge in 2-3 months and would like to get the prime rate.  Because the card is not my oldest card and the balance is so low I don't now if the card helps, hurts or (I suspect) doesn't make much of a difference. 

Other data:
No missed payments/late accounts/public records, we have one mortgage for a house we rent out.  

Any suggestions?

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Welcome to MyFico.  Don't close it and don't apply for a new card if the goal is to get a mortgage in 2-3 months.  Ask for a CLI instead.  With your scores now at 770, you should be able to get a very good rate.

[4MER2R0]

Thank you for the reply and the advice.

Should I whether they are going to add a hard inquiry before proceeding?  

[Anonymous]

Yes that's probably a good idea. If they are planning to do a HP it's likely best to wait until after you secure your mortgage. At this point, the card is not hurting you as it stands.

[Anonymous]

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@4MER2R0 wrote:

Thank you for the reply and the advice.

Should I whether they are going to add a hard inquiry before proceeding?  

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What card are you going to be requesting a CLI on? Who issues it?

[Anonymous]

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@Anonymous wrote:

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@4MER2R0 wrote:

Thank you for the reply and the advice.

Should I whether they are going to add a hard inquiry before proceeding?  

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What card are you going to be requesting a CLI on? Who issues it?

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Good question.

[4MER2R0]

Its a Chase Freedom Card.

[OmarGB9]

Definitely going to be an HP for a CLI then. Don't do it.

[Anonymous]

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@4MER2R0 wrote:

Its a Chase Freedom Card.

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It will be a hard pull.  If the goal is to increase your scores from 770 to 800, a CLI will have minimal impact.  Here is how your scores are calculated.. So is there something else in credit profile you can improve on to get you to 800?  4 credit cards are enough.

What you can do is reduce utilization from 12% to below 10% on each card.  Also, reduce the balances on other loans you have on your credit profile thus if there is any.

[4MER2R0]

Its weird.  All of my other cards just increased my limit automatically and I've actually used it more than the others (I try to take advantage of the categories) but I don't think I've ever carried a balance from one month to the next.  Then again, maybe that's the reason... They might be losing money if I'm getting 5% back, never paying interest and they are only getting 2-3% on purchases.