Does more credit necessarily equal higher scores?

[Anonymous]

Clearly, my scores are in the rebuilding phase and there aren't very many cards I can get my hands on that aren't secured.  But, it seems to me that many here with higher scores have many cards and substantial lines of credit.  I have plans to apply for a VA loan in the future but am holding out for better scores.  Is applying for great cards you have a high chance of being approved for one path to higher scores?

I have 3 cards:

USAA Classic Visa: $1,000 -- Util. at 5% (Soon to be 0)

Discover IT Secured: $1,000 -- Util. at 5%

Lowe's: $2,400 -- Util. at 54% (to be 0 in a week)

If I properly maintain just these three cards, can I possibly make it into the 700's within a year, or do higher scores require expansion (more credit, CLI's) at some point?  I have a pretty thin file and my only baddies are few 30-day lates and a 60-day late, the last one being 28 months ago.  It's a rebuilding question, but adapted to my circumstances it's a credit question, which is why I ask it here.  

Any and all guidance is welcome and appreciated.

[CreditInspired]

Welcome to the MyFICO forum
The answer to your title question is no? Having 3 cards is adequate. What equates to getting and maintaining higher scores are (1) low utilization; (2) AAOA - passage of time without applying for new credit (12 months), and (3) only one CC reporting a balance of <9% and the other 2 cards reporting a $0 balance. The main thing to do now is get those baddies removed in order for scores to increase. You say that you only have a few. Unfortunately, one baddy is one too many! Have you considered paying them off or doing goodwill letters to have them removed? The younger that baddies are, the worse they look. So even 28 mos look bad if there are baddies that happened after that. When did your other baddies occur?

[SouthJamaica]

---

@Anonymous wrote:

Clearly, my scores are in the rebuilding phase and there aren't very many cards I can get my hands on that aren't secured.  But, it seems to me that many here with higher scores have many cards and substantial lines of credit.  I have plans to apply for a VA loan in the future but am holding out for better scores.  Is applying for great cards you have a high chance of being approved for one path to higher scores?

I have 3 cards:

USAA Classic Visa: $1,000 -- Util. at 5% (Soon to be 0)

Discover IT Secured: $1,000 -- Util. at 5%

Lowe's: $2,400 -- Util. at 54% (to be 0 in a week)

If I properly maintain just these three cards, can I possibly make it into the 700's within a year, or do higher scores require expansion (more credit, CLI's) at some point?  I have a pretty thin file and my only baddies are few 30-day lates and a 60-day late, the last one being 28 months ago.  It's a rebuilding question, but adapted to my circumstances it's a credit question, which is why I ask it here.  

Any and all guidance is welcome and appreciated.

---

No it's not. You can have great FICO scores with the cards you already have. The main thing is to get rid of your negatives and not get any new ones.

Let 2 cards report a zero balance, and one a small balance.

[Anonymous]

Great advice from the others.  As they explain, there is no FICO scoring advantage from having bigger CLs. 

Suppose Bob has three credit cards that each have a $500 limit and he has a 3% total utilization   Then his three issuers decide to raise his credit limits to 20k each the next month.  He will get zero extra points.  FICO won't care.

Do you have an open installment loan?  A person who's only open accounts are three revolvers might benefit from a fourth account that is an installment account.  We can recommend the best way to do this if you want to do it (it would cost you almost nothing in interest, etc.).

Otherwise you should open no more accounts and work with the folks in the Rebuilding forum on getting as many of your derogs removed as possible.

[Anonymous]

Do you have an open installment loan?  A person who's only open accounts are three revolvers might benefit from a fourth account that is an installment account.  We can recommend the best way to do this if you want to do it (it would cost you almost nothing in interest, etc.).

Please do explain.

[Anonymous]

---

@Anonymous wrote:

Do you have an open installment loan?  A person who's only open accounts are three revolvers might benefit from a fourth account that is an installment account.  We can recommend the best way to do this if you want to do it (it would cost you almost nothing in interest, etc.).

Please do explain.

---

All you need to do is read the first 2-3 posts in this thread:

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Adding-an-installment-loan-the-Share-Secure-technique/m-p/4506756

[mitchblue]

To get a higher score paying two to zero and let one report a small balance is correct but you can have a really good score without following that.. Half my cards report zero and the other half report 1-9%..  Occassionally one-two reports 10-20%.

[Anonymous]

---

@mitchblue wrote:

To get a higher score paying two to zero and let one report a small balance is correct but you can have a really good score without following that.. Half my cards report zero and the other half report 1-9%..  Occassionally one-two reports 10-20%.

---

That's the ideal formula for anyone with exactly 3 cards, as it allows less than 50% of cards to report a balance while the others report $0.

What you described above is essentially the same thing, just with more than 3 cards total.

[Anonymous]

---

@Anonymous wrote:

---

@mitchblue wrote:

To get a higher score paying two to zero and let one report a small balance is correct but you can have a really good score without following that.. Half my cards report zero and the other half report 1-9%..  Occassionally one-two reports 10-20%.

---

That's the ideal formula for anyone with exactly 3 cards, as it allows less than 50% of cards to report a balance while the others report $0.

What you described above is essentially the same thing, just with more than 3 cards total.

---

Just wanting to understand but isn't utilization not that important unless you are trying to obtain a loan?  I tend to not care about mine as I pay in full each month, sure my score drops but it goes right back up once I pay them down.  It flucutates all the time.  I figure when it comes time to buy a house I will focus on that more.

[Anonymous]

---

@Anonymous wrote:

---

---

Just wanting to understand but isn't utilization not that important unless you are trying to obtain a loan?  I tend to not care about mine as I pay in full each month, sure my score drops but it goes right back up once I pay them down.  It flucutates all the time.  I figure when it comes time to buy a house I will focus on that more.

---

If you PIF every month, your reported utilization is likely a non-factor.  I agree that there's no reason to worry about it and/or maximize it until about a month before you are looking to take on a loan.