Credit Journey as a European in the U.S.

[hd197824]

Ladies and Gentlemen,

thank You for any input in advance.

Datapoints ( I am a European residing in the U.S. )

Oldest Account BMW Financial ( car lease paid in full back in 2014)

May 2023 :I got a Capital One Platinum Card ( $ 500 limit, always paid in full, let a balance report but never carried)
Credit utilization between 1% max 8 %

April 2024 : I used their website tool , got a CLI to $ 600

August 2, 2024 : I applied for a preapproved mail offer from Discover,got approved
starting limit $ 2000

Experian Score 770 mid August 2024

August 20 : Dicover Reported the new account to all 3 bureaus

Total Credit limit $ 2600

August 23 : new Experian Score 731, credit usage $24 out of $ 2600 so around 1%

What is the reason for this drop in points?

Thank you very much for any help in my matters.

Sincerely ,Hendrik

[coldfusion]

You had a new account report and  having a new account report impacts several scoring metrics, starting with AoYA (Age of Youngest Account), for both Vantage and FICO scores.

Welcome and congrats on your approval!

[FicoMike0]

As @coldfusion  said, you got a couple of negatives. As everything ages, your scores will creep back up. Having a second revolving account will help too. Both the hard inquiry and youngest account less than 12 months penalties will disappear completely in 12 months.

[hd197824]

Thank you very much for your explanation. Are there any further steps I should take ( a third card ) ?

Am I handling the utilization and payments in a proper way?

Sincerely, 

Hendrik

[Thomas_Thumb]

A 3rd card is usually beneficial in the long run. Now would be an ok time to get it. Your score is still above 720. You are already in the new account penalty box (which likely cost you 20-25 points). So, you won't see another one of those. The new account affects Fico scores on all 3 CRAs. When your youngest revolving account ages to 12 month you will regain the lost points.

A new hard inquiry typically costs 4-7 points. Another new card will result in another hard inquiry (HP). That would cost another 4-7 points . However, the point loss is limited to the CRA(s) where the inquiry shows.

If you want a 3rd card, get a keeper card that provides high credit limit increase potential. One option to consider is the AMEX blue cash everyday (BCE).

Yes, keeping reported card utilization under 9% is a good strategy. That ensures aggregate utilization never reaches 9%. You do want to report a balance on one or more cards to avoid the "no recent revolving account activity" penalty that is triggered by "all $0" balances. The balance reported can be as little as $5 - it does not have to be 1% on the low side.

[hd197824]

Thank you for all the insight, very much appreciated.

Today I checked all 3 bureaus, due to this new account all dropped from 770 Fico 8 

to 730 TU/EX  and Equifax to 710. Is that any reason for concern?

Thanks to all of you again.

[Thomas_Thumb]

Well ... The 60 point drop is extreme. So something else must be in play in addition to the new account. Get a copy of your EQ credit report and review details. Perhaps compare it side by side with a same day copy from TU.

[hd197824]

Thank you very much, doing that right now.

Would it be ok, if I post screenshots of said reports?

Appreciate any inputs !

[Thomas_Thumb]

Yes, that is allowed but it should not include your name, address, email or phone number. However, not sure if new members can paste pics. A rank of member or higher may be required.

Rank is based on number of posts, minutes on line and number of logins. You have sufficient posts (6, min of 5 required) but may be under the minimum signin count (10) to rank up. Logging out and in a few times may bump you to member rank assuming you have clocked more than 60 minutes of logged in time.

[hd197824]

Thank you very much,

I uploaded said screenshots to IMGUR.com 

https://imgur.com/a/ZXL9JTC        Transunion July/August

https://imgur.com/a/TZYevlv            Equifax      July/August

Please let me know if it works, otherwise I will just write it down in detail.

Any help is very much appreciated.

Sincerely,

Hendrik