one credit card or two ?

[Anonymous]

I recently applied for a credit card about  2 months ago and i was approved for a $300 credit limit.Then I checked my credit score to find out that i have a 652 . I have a hospital bill that I'm going to pay off which $270,other than that no loans, and no debt, so my question is should i apply for a second credit card to build credit score faster or remain with one.

[RobertEG]

There are both short and long term impacts.

In the long-term, you need to build a "thick" credit file to move into the higher FICO scoring buckets.  Multiple revolving lines of credit are usually necessary in order to do this.  The earlier you do it, the sooner it will begin building AAoA.

On the negative side, you will take a temp hit for a new inquiry, and a small hit for reduced AAoA.  You will have another CC to montior monthly for low % util.  The longer you wait and get some score improvements elsewhere, the better the chances of getting a lower interest rate card with a higher CL. 

In the long term, it is wise.  A lot depends on how successfully you montior card usage, and maintain low % util.  If you dont plan on applying for new credit within the next six months to a year, then it is probalby wise to take the slight hit now, looking to the future.

[Anonymous]

How do I maintain a low % util, is that just me paying in full what ever I use on my cc before due date?

[MarineVietVet]

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@Anonymous wrote:
How do I maintain a low % util, is that just me paying in full what ever I use on my cc before due date?

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Hi there.

For most credit cards whatever the balance is when the monthly statements posts is the amount used to calculate utilization for the month. The general consensus around here seems to be that for many people having a utilization of <9% of your credit limit works best. You can use your card as much as you want but make sure you time your payments so that the desired balance is achieved several days before the statement posts.

Then pay the balance in full before the due date to avoid interest.

Edited for typo.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[Anonymous]

THANKS, SEMPER FI

[Anonymous]

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@Anonymous wrote:

I recently applied for a credit card about  2 months ago and i was approved for a $300 credit limit.Then I checked my credit score to find out that i have a 652 . I have a hospital bill that I'm going to pay off which $270,other than that no loans, and no debt, so my question is should i apply for a second credit card to build credit score faster or remain with one.

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Hi younghill,

Welcome!  Glad you're posting!

So, you have no loans and no debt other than the hospital bill.  Do you have any other older accounts that are closed?

What accounts show up on your Credit Report?

If your new CC is the only account showing up on your CR, you may want to consider adding another - whether it's a CC or other revolving account, or an installment.  Put a few more months age on your current CC before pushing the app button again.  And do your homework to see which cards are most likely to approve you before apping.  You don't want to rack up a lot of inquiries.   In the meantime, check out the Rebuilding Your Credit forum to see what work you can do to build up your score before your next app.  The best way to find out what to work on, is to pull your FICO score here and check out the report that comes with it.  Look at "What's Helping your FICO score" and "What's Hurting Your FICO Score."  That'll give you some good focus.

Then, sit back and let everything age for a good long time.  When your scores are nice and healthy, you could look at adding a high quality card or two that you'll keep for life.