Just got an approval from Cap1, had a question re: Inquiries

[Khalifa_Jayy]

Good afternoon, all. I'm new to the board but have been lurking for a few months now. As someone who had to battle back from several charged off student loans, this board is a godsend. Thank you all for sharing an amazing breadth and depth of knowledge and wisdom! I look forward to learning more and more from you all.

I had one question: I had been getting a ton of pre-approval letters from CapitalOne. I've had a secured card with them for about two years, and after nearly daily getting a pre-approval notice (subject to further credit check, of course!), I decided to bite the bullet and give it a shot. I got an instant approval through the site for $3k. I'm ecstatic, as that basically doubles my other largest line other than a Kay Jeweler's line that I have. Definitely my largest CC.

My question is this: I've also been considering an Amazon card. My wife and I make purchases through Amazon quite regularly (personally and for the church ministry we help support), and we think it'd be nice to have an Amazon CC. I've read several conflicting reports on the following: Is it wise or unwise to apply for multiple CC's in one "inquiry period," if that exists at all? I just applied and got approved for Capital One QS last week on Thursday. My score, from the Capital One credit tracker is a 657.

What kind of suggestions do you guys and gals have?

Thanks for reading. I'm looking forward to interacting with you all around the forums.

[Anonymous]

Welcome to the forum! I can't speak to your question, but other members will, I am sure. Good luck to you and congratulations on your new credit line.

[Anonymous]

Congrats on QS approval!

There's a couple ways you can look at it. If you apply now, the accounts will age together, so while shortening your AAoA for the time being, you are building a stronger foundation as these cards age, especially as you pick up more cards along your journey. I would venture to say this is the most common outlook on this forum, when it comes to obtaining new credit. Many members go on "app-sprees" after their time "gardening" for that reason. By the time the INQs fall off, the new account edge will have wore off and your AAoA will have recovered a bit.

On the flip side, if you plan on applying for more credit in the near future, you may get hit with the too many new accounts message. That would really only be an obstacle if your seeking a mortgage or maybe a more prime card.

[Anonymous]

Welcome!  Unsure what you might be thinking of when you refer to an inquiry period.  The only thing I know like that has to do with rate shopping for car or home loans.  That's where there is a positive advantage to applying to several creditors all in the same 14-day period (e.g. for a mortgage pre-approval).  There's no corresponding thing for credit cards.

People can best help you make the right choice for YOU if you give us some more information.  Here are some stuff you could tell us:

(1)  Can you describe your negatives a bit more?  They definitely include charged off loans.  Is that it?  Any lates?  When (roughly) are they dated?  E.g. 3-4 years ago, say?

(2)  How many open credit cards do you have now?  When were the two most recent cards opened?

(3)  Do you have any installment loans?

(4)  Do you have any major loan applications coming up in the next three years?  (Car or mortgage?)  If so, roughly when?

[Khalifa_Jayy]

---

@Anonymous wrote:

Welcome!  Unsure what you might be thinking of when you refer to an inquiry period.  The only thing I know like that has to do with rate shopping for car or home loans.  That's where there is a positive advantage to applying to several creditors all in the same 14-day period (e.g. for a mortgage pre-approval).  There's no corresponding thing for credit cards.

People can best help you make the right choice for YOU if you give us some more information.  Here are some stuff you could tell us:

(1)  Can you describe your negatives a bit more?  They definitely include charged off loans.  Is that it?  Any lates?  When (roughly) are they dated?  E.g. 3-4 years ago, say?

(2)  How many open credit cards do you have now?  When were the two most recent cards opened?

(3)  Do you have any installment loans?

(4)  Do you have any major loan applications coming up in the next three years?  (Car or mortgage?)  If so, roughly when?

---

1. Charge-offs, mostly. Included in those were a few late pays, but they are over 4 years old. My most recent late pays are March '11.
 

2. Right now I have:

• Bank of America (Student CC) $1,500 limit (opened 2007)
• JCPenney Store CC $338 limit (opened 2010)
• CapitalOne Secured $1,251 limit / $800 is secured, I believe (opened 3/01/2011)
• Kay Jewelers Revolving Charge Account $7,650 limit (opened 12/1/2013)
• CapitalOne QuickSilver $3,000 (just got this)

3. I have a mortgage that I currently pay and a paid off vehicle loan in my recent history (paid 6 months ago).

4. I will likely be applying for a mortgage in the next 8-12 months, if all goes according to plans. My current mortgage is a rental property.

[Anonymous]

If I were you, then, I would stop applying for any more credit cards.  Postpone getting any more cards until after you own the new house.

When a person knows he is going to be buying a house in the next 18 months, there's only one good reason to apply for more credit cards.  And that is if he currently only has 1-2.  There is a significant FICO advantage to having three cards, so if a person only had 1-2, then maybe he should open a third.  But in your case, you already have five.  Applying for more cards will only cause you to have a lower score at a time when you need every fraction of a point you can get.  Furthermore, there will be a manual review of your reports, and it will look better for you to have opened as few cards as possible in the run up to doing that.

The other thing you should be doing is paying your credit card debt down as low as you can.  Of course you will have to balance that against the need to save toward a downpayment.  But from a scoring perspective, the ideal would be to have all your cards reporting as $0 except one, and that one with a fairly small balance, so that your total utilization is 1-8%.  (1% is simpler if you can do it.)  Getting all the cards like that should be done about two months before you need your mortgage pre-approval (and again before you close on a particular property).

Do you have any negative payment information on your current mortgage?  (lates, etc?)  How long have you had that mortgage?

[takeshi74]

---

@Khalifa_Jayy wrote:

Is it wise or unwise to apply for multiple CC's in one "inquiry period," if that exists at all?

---

There is not.  Inquiries generally lose their impact at one year and fall off at 2.  Whether or not multiple inquiries in a given timeframe are wise all depends on what one's credit profile can support.  X can be too many for one profile and no big deal for the next.

---

@Khalifa_Jayy wrote:

My score, from the Capital One credit tracker is a 657. 

---

Always consider the specific scoring model, CRA and the relevance of that combo for a given creditor.  CO provides a TransUnion New Account score that is not used by any creditor.  Keep in mind that it is never just about score but if you want to reference them then you need to find the score used by the creditor that issues the Amazon card.  Check the Credit Pulls Database.

If your FICO 8's happen to be similar to the TransUnion Score then you probably have issues that you need to address with your credit profile and your profile probably won't support all that many inquiries.

---

@Khalifa_Jayy wrote:

Charge-offs, mostly. Included in those were a few late pays, but they are over 4 years old. My most recent late pays are March '11.

---

Definitely work on addressing those.  We always recommend working on derogs first as they tend to have a singificant impact and hold one back.  Carefully research in the Rebuilding subforum before taking action.

---

@Khalifa_Jayy wrote:

2. Right now I have:

• Bank of America (Student CC) $1,500 limit (opened 2007)
• JCPenney Store CC $338 limit (opened 2010)
• CapitalOne Secured $1,251 limit / $800 is secured, I believe (opened 3/01/2011)
• Kay Jewelers Revolving Charge Account $7,650 limit (opened 12/1/2013)
• CapitalOne QuickSilver $3,000 (just got this) 

---

What's the reported revolving utilization (balance/limit as indicated on your credit reports) on each of these and your overall revolving utilization?

[Anonymous]

Hi Khalifa_Jayy.  Takeshi is asking a lot of helpful questions.  He's got a lot of experience.

The bottom line from me is twofold. 

(1) The question that was directly on your mind was: what cards (if any) should I apply for?  My answer is none.  No more CC applications -- you already have five and your sole focus should be on preparing for the mortgage.  Which leads to...

(2)  How best should you prepare for that mortgage?  That's a big question and you can get lots of help here but also other places.  Some of that has to do with how best to improve your score (paying down CC balances, exploring whether any negatives might be able to be removed, resisting all desire to add more cards, and most of all getting very familiar with everything on your credit reports on a monthly basis).  But all that has to be integrated with other decisions -- improving the credit profile of anyone else who might be a co-applicant on the upcoming mortgage, saving for a downpayment, etc.

Happy to talk more if you like.  Very best of luck...

[Country_Feller]

Congrats on your approval and welcome to the forum. I don't pay much attention to Cap1's credit tracker as it has me about 35pts. lower than my lowest FICO score. If it were me, I would hold off on applying for anything else and concentrate on keeping my utilization under 5% or so until I was in my new home. Good luck to you!!!