Utilization about to hit a high for emergency...suggestions? permanent damage? (Data points incl)

[GoalCrus]

Hi all!

So I have been pretty much practicing the AZEO method since I started rebuilding last November. All has been well and I have been able to build My credit up from mid 500s to peak at 714. Last month it dropped 9 points I'm sure due to my Discover balance and an inquiry from NFCU.

However, I have an emergency that is the tune of $5k. I plan to put it on to my Discover It card as it has the highest CL ($13,500) and is still in the  0% intro apr. This will bring my balance to about $8.5k.  

I was about to pay it down but can no longer do so.  I estimate it will take me about 6mos to bring it back down below 8.9% - considering LIFE IS HAPPENING right now and my cash flow is being interrupted severely. I have a contingency plan but  I don't know if it will work until the end of the month. 

So I'm wondering:

What kinda hit I'm gonna take on my score(s)?

Will there be any permanent damage to my credit score?

Any advice on what I could leverage or do to keep my score as high as possible before the utilization reports?

Here are my data points:

EX: 705 EQ: 672 TU: 701

AAOA: 10yrs, 11months

Total UTI: 21% (as of today)

Capital One (Opened 11/17)

Balance: $0/$750

Discover It (4/18)

Balance: $3800/$13,500 (actual balance is $4,500 as of today; not reporting until 9/7)

Amex (4/18)

Balance: $0/$1000

Amazon (4/18)

Balance: $0/$3000

Fed School Loans (Opened 1996 -1998)

Four (4) loans totaling $27k. Reporting  120+/150 days past due Oct-Dec 2013

**NFCU (8/18)**

Balance: $0/$1000

(This account is not reporting yet, but the inquiry is on TU. Will report around 10/8/18.)

I tried to get an increase from Discover yesterday but was denied. I guess because I just got a $4k increase in August. 

Thinking about trying for 3X CLI with AMEX again on the 7th (61st day from the last denied request). Hoping that they use the last soft inquiry they did on September 8th, showing 714 EX score and less debt on Discover.

Anyhow, thanks in advance for your help and suggestions!

[Anonymous]

Quick question: you say that your AAoA is nearly 11 years, but that your cards were all opened in the last year, some only a few months ago.  How is that possible?

I wouldn't worry about the debt on the Discover card going up.  Your individual util on the Discover will be < 67% and your total utilization will be < 47%.  Sure your score will drop some but that not enough to cause any CC issuers to take Adverse Action against you.  What you should certainly do to further protect yourself against AA is to make sure that you are always paying at least $2 more than the minimum payment on every card, and in the case of the Discover, double the minimum payment + $2.

There is no permanent harm done by utilization increases.  The penalties will vanish as the CC debt is paid off.

[GoalCrus]

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@Anonymous wrote:

Quick question: you say that your AAoA is nearly 11 years, but that your cards were all opened in the last year, some only a few months ago.  How is that possible?

I wouldn't worry about the debt on the Discover card going up.  Your individual util on the Discover will be < 67% and your total utilization will be < 47%.  Sure your score will drop some but that not enough to cause any CC issuers to take Adverse Action against you.  What you should certainly do to further protect yourself against AA is to make sure that you are always paying at least $2 more than the minimum payment on every card, and in the case of the Discover, double the minimum payment + $2.

There is no permanent harm done by utilization increases.  The penalties will vanish as the CC debt is paid off.

---

Thanks for your reply and suggestions! Much appreciated.

1. My oldest account is 21yrs, 10mos; Student loans from 1996.

2. I just checked and last month I only made the (automatic) minimum. New payment due today; I made and add'l payment more than double the (automatic) minimum payment. Am I still in the clear? Plus, I added my cashback as a payment. [Learned something new here!]

3. Think I should go for that 3x AMEX CLI?

Thanks again! 

[Anonymous]

You'll be fine.

Sure, feel free to do the Amex CLI request if you feel like it.

I would certainly stop all further applications for credit cards until all CC debt is paid off and you have had time to get higher limits on your existing cards.

[GoalCrus]

Yep! I'm in the garden until May 2019.

Thanks again!

[Anonymous]

OP, when was the last time you requested/received a Discover CLI?

They are soft pulls, so no harm in trying one.  At your current utilization you stand a much better chance of receiving one than if you wait and that new higher balance reports.  You could get lucky and get a CLI from Discover and that new credit limit would report at the same time as your new (higher) balance, thus cutting down on the utilization percentage increase a bit. 

[GoalCrus]

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@Anonymous wrote:

OP, when was the last time you requested/received a Discover CLI?

They are soft pulls, so no harm in trying one.  At your current utilization you stand a much better chance of receiving one than if you wait and that new higher balance reports.  You could get lucky and get a CLI from Discover and that new credit limit would report at the same time as your new (higher) balance, thus cutting down on the utilization percentage increase a bit. 

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I got a $4k increase in August bringing my CL from $9.5k to $13.5k. 

I pushed the button yesterday and received the "letter in the mail" response.

Thinking about trying again after these payments post on the same day as I try for the AMEX 3x CLI.

[Anonymous]

It can't hurt.  Some people have reported Discover CLIs 30-60 days apart, so it can be done.

[Shooting-For-800]

Utl affects everyone differently but I would not worry about it.

I would try not to get any card too close to its limit.

If you are really worried about it, I would try to even out your debt among cards so the avg utl matches each cards utl.

Regardless, as you start paying them down, your score will go right back up.

You could also apply for another card with a high limit to help your long term utl.

You will be fine.

GL!