how many credit cards is too much?

[Anonymous]

Hey Byrdman, 

RE: I personally attained an EQ FICO of 790 with one open CC a few months back.

Wow....Not that I doubt you, but were you in possession of other tradelines or loans in addition to this single credit card?  What kind of a credit mix did you have? To what would you attribute such a wonderous score?

A few details might be helpful, like your length of credit history and number of recent inquiries.

Do you believe that a couple of additional credit cards wouldn't improve your FICO score by rounding our your credit mix? I'm pretty sure I read a MSN financial news piece that claimed one credit card was not enough to maximize your credit mix for FICO purposes. Yet it doesn't seem to have hurt you significantly. 

Regards,

Cato

[Junejer]

Hi cato, I had one open installment loan also at the time. However, my credit history was 18.5 years long, with an AAoA of over six years as well. I had lots of past credit (closed) that was helping AAoA. I had gone off the grid for awhile, stupidly closing out credit cards all willy-nilly, just because I wasn't using them (and afraid the ex would run them up to destroy me).

I then took that 790 out for a "spin" and opened five or six more CCs, including a couple of store cards. I am done apping for stuff now. I have HD, Lowes, Jared, and five MC/Visa cards. My scores are about 100 points lower now, but that's mainly due to me having poor util right now (rehabbing a house and using my cards).

[Anonymous]

Holy Haddock, Byrdman...I can only yearn for an 18 year credit history to buttress my Fico scores. Had I not cut up all my credit cards back in the 1980s, I'd be looking at FICOs in the 800 range by now, I have no doubt. Hey, it was the rashness of youth, I guess.

Still, I think your case makes the point that having several credit cards, even some that are closed, is healthier than a single cc for scoring purposes. Geez, I could retire from credit worries permanently if I had a FICO 790 under my belt.  Congrats.  Even though it's slipped a bit from your utilization issues it's still good to know you'll be bouncing back in due time.

I sure wish FICO would be more forthright about the details of their scoring methods. It's like playing a football game where there are few posted rules but plenty of penalty calls that hit you out of the blue.  I understand FICO wants to protect their proprietary formula but sometimes this seems like a game of gotcha.  

The result is there are more people having credit problems nowadays out of sheer ignorance rather than because they're simple deadbeats. For example, why don't credit cards carry a warning on their statements that high utilization rates could be detrimental to your credit scores?

To people on these boards, a 30% util rate or less is just common sense. But I'll bet more than half the people in America with credit cards haven't got a clue what the acceptable utilization rate is.  Tsk. 

I try to keep mine below 10%. But needs must when the devil drives and 30% will do in a pinch for the big ticket stuff.

Regards,

Cato:  Length of credit history: a mere 20 months: and counting.... (Sigh) 

[Junejer]

I too, stupidly disputed off old closed CC TLs and installment loan TLs that had been in good standing for years. Before Myfico, I didn't understand the util thing. As long as I was paying my bills on time, who cared? Oh well, I know now. As soon as this house is finished, I am bringing my overall and individual util down to about 1%.