How much will it drop?

[Anonymous]

Hello all.  First post...

I had lost my job a year ago, and my score went from over 700 to under 540 in about 4 months.  I had some 30 and 60 days past due reported (car loan and cards), as well as some balances maxed out.  I have since brought all accounts recent (June was my last "catch-up" payment), and have started slowly paying the balances down.  With my FICO drop, my interest rates jumped to 30%.  So, after seeing my Equifax score of 633 the other evening, I decided to apply for a 0% balance transfer card.  I was declined.  I was frustrated, but more worrysome is how will that affect my score?  I will be trying to purchase a used car in the spring, so I am trying to prepare my credit for that.

Do you think it would be too soon to apply for credit limit increases to bring my available credit up?  As it sits, I have $21k in limits, but only $7k used.  Not too bad, except for 2 cards are pretty much maxed.  Should I try getting those balances to <50% and then trying to get the increase?

[wrw0010]

If you are only using 33% of your total CL, you should be able to do balance transfers that will bring the maxed out cards under 50% (with some creativity you should be able to reduce them all under 35%). Reallocation will probably give you a real boost in scores.

Message Edited by wrw0010 on 10-16-2007 01:27 PM

[SmartCookie]

It definitely does not hurt to call up your CC co's and ask how much of a CLI they can give you without doing a hard INQ.  Some do an internal review, some will do a soft INQ.  You might get lucky. 

After you do that, complain about the interest rate and see what they can offer you, even if only temporary.  Tell em you got a BT offer that you are considering but you would prefer to stay with them out of loyalty if they can make it easier for you to do so.

[Anonymous]

So, do you think that even though I just applied for a card to do a balance transfer and got declined, that I should continue trying to apply for others?

How will this negatively affect my score?  How will the 1 time I have done an application affect it?

After getting declined once, I am discouraged enough to just forget about anything that pulls my score until I go for a car loan in appx 6 months.

[SmartCookie]

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stress83 wrote:

So, do you think that even though I just applied for a card to do a balance transfer and got declined, that I should continue trying to apply for others?

How will this negatively affect my score?  How will the 1 time I have done an application affect it?

After getting declined once, I am discouraged enough to just forget about anything that pulls my score until I go for a car loan in appx 6 months.

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IMHO at this time, you are only going to take hard INQs for declines.  Each hard INQ does impact your score for a total of 12 months, more important in the first 6 months.  They drop after 2 years.  As far as the actual point loss per hit?  I don't think anyone has the exact formula so I don't want to approximate what your impact would be, but I would say that at this point for you each hit counts significantly enough.

If you did manage to get approved for something, I don't think you would get above a $200-300 at this particular time.  I would not want the hard INQs for nothing if I were you,especially since you want a car so soon.  Unfortunately there is no way to know for sure who will approve you.

If it were me, I would begin with seeing what sort of CLIs I could get with accounts you currently have, checking first to ensure that there will be no hard pull.  If all goes well, you should be able to improve your UTI this way and then improve it by paying all you can each month.  I would reassess after seeing what you can do now in all the lovely ways of credit cleanup before continuing to apply.

Would love to know if you do choose to try for CLIs, keep us posted.

[Anonymous]

Armed with that info, I think I'll just continue on my path of trying to pay down the balances.  I will also try some CLI's and negotiate rates.

The only other issue I have is being quite upside down on my current auto loan.  I could probably only get about $5k selling it privately, but I owe $9k.  So, do I pay the balances, or try to get rid of that negative equity?  Very tough decisions.

Thanks for the replies!

edit:  How would I ask the current CC's to do a "soft" pull as opposed to a "hard" pull?

Message Edited by stress83 on 10-16-2007 02:42 PM

[SmartCookie]

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stress83 wrote:

Armed with that info, I think I'll just continue on my path of trying to pay down the balances.  I will also try some CLI's and negotiate rates.

The only other issue I have is being quite upside down on my current auto loan.  I could probably only get about $5k selling it privately, but I owe $9k.  So, do I pay the balances, or try to get rid of that negative equity?  Very tough decisions.

Thanks for the replies!

edit:  How would I ask the current CC's to do a "soft" pull as opposed to a "hard" pull?

Message Edited by stress83 on 10-16-2007 02:42 PM

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That's a tough one regarding the car so I hope someone has some good advice on it.  I have seen people selling cars to others who will 'take over monthly payments', if that is at all a possibility.  I don't know enough about it.

When you call your current CC co's all you have to do is explain you would like a CLI but you don't want to do anything that would cause a hard INQ.  Ask them if they can see how much of a CLI they could give you without one in their system or if they do a soft INQ account review.  They are familiar with this.  Just be clear to them that you are scouting what they can do for you, not applying.  They may (or may not) say no, or they might say sure we can give you 500, 1000, 2000 etc.  So, if they are able to do so, ask for the max they can do without the hard pull (INQ).  And always write down names, times etc.  G'luck!

[Anonymous]

Forgive me if I should be in another section of the forums or doing a search before asking this last question...

2 of these cards were closed by the grantor.  Is it possible to call them and ask them to reopen the account?  Would that remove the closed by grantor from the reports?

[SmartCookie]

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stress83 wrote:

Forgive me if I should be in another section of the forums or doing a search before asking this last question...

2 of these cards were closed by the grantor.  Is it possible to call them and ask them to reopen the account?  Would that remove the closed by grantor from the reports?

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No, here is good for that question!  Always search as well though as you might also be able to find posts where someone had a similar situation and you can see others experiences.  It's a goldmine here!

As far as I am aware, the only CC co that will re-open an account is AMEX.  By re-opening I mean they will start you with the date you opened a previous card, but I think all history and account number is wiped.  Never hurts to call and ask but it is not common for an old account to be reinstated.  So, yes try but make sure you are not re-applying for a new card that is going to be tied into anything you had previously.

Now, if your only issue here was to remove the 'closed by grantor', you do have the option of writing a GW letter asking them to change that to 'closed by consumer'.  They would be most likely to do this if the account had a 0 balance.  if there are any other derogs on the cards, you can tie that in to the GW letter as well and hope for the best.

What companies were the cards with and when were they closed?

[Anonymous]

Well, I've been speaking with the following...

GM Card/HSBC - (no late remarks from this card) Could not lower my interest unless I had an offer sent to me; Could not offer CLI without doing a hard pull

WaMu - (no late remarks from this card) Could not lower interest or offer CLI unless I had an offer sent to me.

Chase - (60 day past due marks; this account was closed by grantor) Could not lower interest or offer CLI due to the account being closed.  Would not reinstate account.

Dell - (60 day past due marks; this account was closed by grantor) Could not CLI due to account being closed.  They did a soft check for interest, but said no.  Would not reinstate account.

It looks like I'm stuck for now!  A bit of bad luck and it ruins all good I had.  I'm only 24, so I'm hoping I have enough time to fix all the problems that had happened.

For the closed accounts... should I pay off the balances before working on the other cards since I'm at the 50% mark for both and they're both closed, or should I start working on the other 2 that I still have good standing with?