If it's labeled a Consumer Finance Account (CFA), then it could possibly hurt you. There are some people on here that swear by it.
Correct. If the account has been opened whether or not you make a purchase doesn't matter, as the account will show up on your CR regardless. May as well make whatever purchase you were planning on at this point so that it's not a complete waste.
It all comes down to how the account is coded. If it's a revolver, no harm no foul. If it's a CFA, it could adversely impact your scores for up to 10 years from the time the account is closed. The impact of a CFA isn't well known and it can hurt certain profiles and certain scores more than others.
thanks for the reply. I was shocked to read that adding the samsung financing account was lost on average 40 points which for me is very much since I am in full reconstruction I was scared so much that in the end I did not make the purchase but I do not think it matters whether I buy or not since I will have that account opened in my credit
People who talk about credit score impact are almost always referring to their Credit Karma scores. Those are useless. FICO scores are what you need to worry about and FICO will treat this the same way as any other credit card. If you max out the limit with your purchase, you’ll take the penalty like a maxed out credit card. There is nothing special about the reporting otherwise and TD Bank is not a peer to peer or last chance lender so even if it was an installment and not a revolving account, it wouldn’t be tagged as a CFA.
I opened this as well a few months back and just paid off the balance. It has reported as a credit card, however I am closing the card as I will have no other use for it and I do believe my score was impacted by the account being open.