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Debt Reduction and FICO Score

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Re: Debt Reduction and FICO Score

And I think it may be beneficial to state that I believe my relationship is pretty good with Chase.  I've had these cards for a few years and have typically had pretty high limits and paid them off rather quickly.  Used to own quite a bit of stock that I would sell to pay the debt off.  But, I've made some poor decisions regarding my personal finance in the past years, buying a new truck, paying to much in rent, which has caused me to learn to manage my spending a little better.  I'm moving in the direction of getting a cheaper apartment and with this debt paid off, should have $1000 more each month in purchasing power.  Gonna start buying $500 a month in stock while at the same time having $500 extra cash of free money.  Once I'm able to move into a cheaper apartment, it'll expand my purchasing power even more.  I think I'm to a point where I've finally learned how to manage everything at a high level, but there was some growing pain involved in the learning curve.  

Message 11 of 12
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Re: Debt Reduction and FICO Score

My comments below in blue.


@Anonymous wrote:

Thanks for all the info and replies, everyone!  I really enjoy this forum.  If I may ask, still learning the lingo, what is AA?


Adverse Action.  That includes a CC issuer raising your APR, lowering your credit limits, closing the card outright, etc.


I think my plan is to either combine Marriott and Freedom (but maybe just keep them sock drawered so my age of credit doesn't go down)....


Combining is OK as long as your total number of cards does not drop below five.  If you do choose to combine, be sure to do that in a way that the resulting open card has the Date Opened of the oldest of the two cards.


Otherwise the sock-drawer approach is fine too.


....or to request a limit increase on one of them up to maybe $10,000 and just keep it as a high limit to help my FICO.


A higher credit limit (in itself) will not help your FICO score at all.  A person have have an 850 score with three cards each of which has a $500 credit limit (and still spend thousands of dollars on his cards each month).  A big credit limit has some value in terms of convenience, however.


It's also worth noting that I don't really plan on needing great credit anytime soon, but would like to have it just if I ever decide to buy property. 


Very good thinking.





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