Just thought of it. Does having fewer than 2 revolving accounts hurt credit?

[Anonymous]

Assuming that credit cards are the only open revolving accounts.

Person A has 1 credit card with a balance
Person B has 2 credit cards, 1 with a balance

Person A has 100% of all revolving accounts with balances.
Person B has 50% of all revolving accounts with balances.

Since a person would have to carry a small balance for those extra 10 points this would also max out a persons ratio of used/unused.

Is there anything to this thought? If so limiting to only 1 credit card can actually be hurtful for credit scores.

Message Edited by ilovepizza on 06-14-2008 04:19 PM

[smallfry]

pizza I would think you would need to have 3 revolving lines at least.

[fused]

I would say yes! Look at what three revolving accounts can earn you.

My sister-in-law has a thin file and her scores are in the low 800's. This is all she has:

1 Chase Visa 15% util

1 Citi Sears card 0% util

1 LOC (OD protection) $0 bal

1 paid auto; clean

1 consumer finance loan paid; clean

Her credit history length is 11 years with an average-age not far away. Simple can work!

[Anonymous]

A lot of people like the 5 revolving card strategy, so you can have 2 report along with one installment loan. Of course it seems you get a small gain by having only 1 of the cards report, no matter what the number. I am currently at three revolving accounts and only let one report a balance. Five sounds ideal but that is more payments to keep track of, more banks to keep happy, and a thicker wallet or sockdrawer! I would probably pick up two more if it wouldn't damage my average age more severely....I will probably wait a few years before taking the plunge.

[haulingthescoreup]

When you only have 3-5 bank cards (not talking about store cards here), you can always do the "card of the month club" approach. Just carry one card at a time, and rotate through.

It gets more complicated when you have rewards cards and so forth, but even then, if you can tell yourself that card A will be used for gas, groceries, and drugstore every month, and a different card will be used for everything else, then you'll keep rotating that second card so that each one will see some action. It definitely keeps you on your toes, though. Keeping track of due dates and util for multiple cards will probably delay the onset of Alzheimer's for a lot of us!

[smallfry]

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@Anonymous wrote:

A lot of people like the 5 revolving card strategy, so you can have 2 report along with one installment loan. Of course it seems you get a small gain by having only 1 of the cards report, no matter what the number. I am currently at three revolving accounts and only let one report a balance. Five sounds ideal but that is more payments to keep track of, more banks to keep happy, and a thicker wallet or sockdrawer! I would probably pick up two more if it wouldn't damage my average age more severely....I will probably wait a few years before taking the plunge.

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I have 6 credit cards plus a store card now. Eventually I am going to close the Juniper Sea Miles card.

[Junejer]

Just wanted to play the other side of the coin here. A little more than a month ago, I had ONE CC reporting to my CRs. It was a $500 limit CC. I had 4% uti and a FICO of 790 from EQ. My opinion is that you can do just fine with only one CC if your avg age is old enough.

[Anonymous]

Byrd,

I think there is no doubt on that issue. I bet you are in a interesting bucket though and that 790 is near the max you can attain. Out of curiousity, what was your length of credit and average age on that report?

[smallfry]

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@Junejer wrote:
Just wanted to play the other side of the coin here. A little more than a month ago, I had ONE CC reporting to my CRs. It was a $500 limit CC. I had 4% uti and a FICO of 790 from EQ. My opinion is that you can do just fine with only one CC if your avg age is old enough.

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Byrd most of the battle is utilization and average age.

[mrlimo]

I have 7 open credit cards, 4 closed cards falling off in another 2 years. I have 3 installment loans showing. Out of the 7 open cards 5 are citi(sears) Gold, Capital One No Hassle Miles, Bank Of America Gold, Chase Platnium, American express Blue Sky. I have the Capital one rewards and American Express Rewards cards with staggard closeing dates so I can take advantage of grace periods before the accounts close. The other cards I use on a 3 months rotation for small items for low util and keep them refreshed before they get a stagnent message from sock drawered too long. I usually show 2 cards with a ballance (3 total accounts with ballance due to mortgage) other 2 installments have been closed for some time PIF Car loan, PIF Balleys total Fitness Membership.