Rooms to Go Credit

[Nae]

So, I recently got a line of credit with rooms to go (used $3000 out of $4000). I had a score of almost 720 which dropped 65 points putong me in the 650s, & I'm pretty sure this is the cause. Is there anything I can do to bring it back up somewhat quickly?

[BudC2]

I'm not the expert here, but I would say get your utilization on the card down to less than 30% and wait a few months for the hard inquiry to lessen it's grip on your scores. What a lot of people don't realize it's that individual card utilization is just as important as overall utilization across all cards. Forgive me if you knew that, but I didn't when I first started paying serious attention to my credit.

[Nae]

I did not know that. I'm not too savvy with this stuff, so I appreciate the advice!

[FicoMike0]

Ditto @BudC2 

First, a utilization of 75% is hurting your scores.

Second, a hp may hurt,

Third, if you AoYA was previously<12 months, there's another penalty.

The only short term help is to pay the utilization under 29%.

[Thomas_Thumb]

I think you meant if AoYA was previously > 12 months.

Opening a new account can drop score 15-25 points if previously the youngest account was greater than 12 months. This penalty will remain in effect for 12 months.

Fico looks at both aggregate utilization for all revolving accounts combined and highest individual account utilization. Assuming a personal LOC is classified as a revolving account then: Highest Individual account revolving utilization going above 29% can drop score and going above 49% can drop score further. Also, increasing aggregate utilization to above 9% will drop score independent of card utilization levels.

If youngest account was previously over 12 months, aggregate UT was under 9% and highest card  UT was under 29%, a guestimate on score drop factors is:

1. Drop in AoYA to under 12 mo - 20 pts

2. New inquiry - 5 pts

3. Increase in revolving account UT to 75% - 20 pts

4. Increase in aggregate UT - 15 points.

5. Other - 5 pts

Given the above, over 50% of the point drop can likely be regained when the PLOC is paid down to under $1k. Unfortunately, the new account penalty will linger as will the inquiry.

[FicoMike0]

@Thomas_Thumb 

Oops!

[Nae]

great info, thank you! So, if I paid off the whole thing would that be better? I have to get a new car as my previous one was just totaled. Insurance is paying off my car & I would get about 6k in pocket. Would I better off putting that towards a down payment on a 36k vehicle or should I pay off the card to get my scores back up to get a decent interest rate?

[Harvey26]

@Nae Attempt to call synchrony and ask for a CLI they are usually pretty generous. Shoot for the moon and let them counter. You would need a 10k limit to be at 30%.