Might be time to give up on CLIs.... for now
Posted by TheChosenOne, Oct 8 2009, 04:20 PM
Right now if it weren't for those GEMB no hard CLI requests, I wouldn't have made hardly any progress the past year on growing limits. For once it paid off to have so many GEMB cards. I have those 4 month periods marked on my calendar. Yep, its that bad. Its taken a lot longer than I had envisioned in 2007 when I first joined (as I read about all that could be accomplished) to reach milestones on total revolving credit due to the economy. A large part of it, in my opinion is the fact credit lines arent growing, at least for me. I have tried, the first 8 months out of the year. Ive even taken hard inquiries to CLIs. But now, I have come to realize it just isnt worth the hard pull anymore.
All it takes is one wasted hard inq to hit your credit report and the CLI denial before you realize, as another CBer mentioned, wasting the hard on a small increase when you can get a lot more using that inquiry for a new line of credit doesn't make sense. If im going to be denied its going to be for a nice, new, potentially big limit card, not a few thousand (if im lucky) on a limit increase. I've also noticed when trying to obtain CLIs, if you already have a decent limit and youre not maxed out, they want to know why you need more. Now, I really can't entertain these questions. Even if I took the time, its falling on deaf ears. Last time a credit analyst approached my request that way I politely ended the phone call and told them to forget it. Its always important to know when to fold your hand and not let those with CWH waste your time. 
Fico and the number 3
Posted by TheChosenOne, Jun 20 2009, 02:59 PM
Somebody asked me the other day about all of my available credit and about doing an AOR (app-o-rama). Of course I told them this was a really bad idea these days, but if they wanted to build up a lot of credit over the course of the next year, I have followed the 3 apps every 3 months rule, and have never 1. had my fico dip, or 2. Received adverse action due to it.
Now heres where I have to tell you, this is very dependant on which fico scorecard you are on, and the age of your file. However, you should be able to tell within the first series of new cards reporting, and as long as you have a decent file with an aged account, this should work for you.
So hows it work? If you limit yourself to applying for 3 cards that report every 3 months, at least on the scorecard I'm on, you do not suffer a fico hit at all. What I have found is that the approvals and the high limits resume after 3 months. The 3 months also gives you time to bump off inquiries, as approval limits will lower with increased inquiries. If a card reports opened in January, you need to wait until at least April to app again. Now, it could very well be 4 or 5 new accounts, but according to the data and information I've seen, this is a very safe number for both fico scoring and account reviews.
The pros: If done right, you can add 12 new accounts to your credit and help out utilization without a fico hit or AA. This means the following year (when you should take a break from applying to let things age), you will have a dozen accounts all solidifying your average age of accounts.
The cons: 1. Don't do this if you plan to apply for a home, car or other big loan. I have always recommended staying away from apps for 6 months before big loan apps. 2. Don't do this if your credit isn't already good/great. You're just going to get a lot of toy credit limits and thats pointless. 3. This is a bad idea if you're trying to get in with a very conservative bank that doesn't like a lot of new accounts. I have found these to be few and far between BUT they do exist.
Here's a great tip: Apply on the last week of the month. Why? Even if you're approved on the last day of the month, they usually report that month as your account open month, which means if they don't report to your credit for 5 weeks, when it pops up its already 2 months old. Avoid applying on the last day because, well these days it seems every app needs to be reviewed by an underwriter and this may take a few days at least, and your account open date is going to be the approval date. Best bet is to app at least 7 days prior to the first of the next month.
I've built a great amount of credit over the past year and a half using this method with no drawbacks other than the occassional denial from a conservative bank for recently opened accounts. Those happen maybe once out of every 10 apps, so I don't mind those denials. Remember to do your research before applying, creditboards is a wonderful place for that, and goodluck!
Received DCU card, no CWH
Posted by TheChosenOne, Apr 25 2009, 10:24 AM
I obliged my first request for paystubs last week and received my reward in the mail yesterday. I can admit that I was expecting the worst when I read the past DCU rosefactor threads. I already had a bad taste in my mouth from an experience with Delta and Alliant. Alliant didn't want to give me a CLI at the 6 month mark due to excessive available credit and Delta didn't want to give me a card at all it seemed. Was the CU world starting to CWH (credit-whore hate)???
I was wrong about DCU, once I faxed my paystub they sent the card immediately without any other requests. Its nice to be pleasantly surprised in this credit crunch. With DCU and Coastal cards this month, I feel like I accomplished expanding my portfolio, which I like to do, and suggest everyone doing every 6 months to a year.
Meanwhile, I still believe we could use a thread (i tried to start one but it got off topic) to reveal the current CUs/Banks who seem to be down with CWH.
Finally.... about me
Posted by TheChosenOne, Apr 15 2009, 04:53 AM
I haven't really done a good job at the following request....
"We want people who have cleaned up their credit, only to find themselves in more debt than they'd like to be and are now in serious debt reduction mode" So I decided to go ahead and try to blog about this specific topic and my own situation.
As of July 2008, I had officially finished credit repair thanks to the great folks and information here on CB. I read and read and read and yes, sometimes I would get so tired of reading that I would speed-read through some threads and sometimes miss the point when I posted. When I come across some of the past posts, all I can do is shake my head. I was overloaded with information and sometimes felt as if to let any more info in would make my head explode, but I still wanted to offer advice, I still wanted to share in the jokes and be a part of the community here. So I posted away.
Through many of the posts in my past, you may come across the one in september 2008 when, after finally having clean reports, got credit line increases on a bunch of cards... which lowered my utilization (and used other methods) and finally had impressive scores of 746, 743, and then there was EX (who cares, right?). The link to that thread
Anyway, yes my reports were great and the credit started rolling in but as creditboards bloggers of the future were expected to blog about, I would soon discover that access to large amount of credit would lead me to allow myself a more liberal budget with which I brought myself $10,000 more into debt, and my credit score down around 10-20 points depending on which bureau you look at today. This was not anybody else's fault but my own. I agree completely with the argument "available credit isn't debt". I can admit, it made decisions to go to starbucks when I felt a little lazy about fixing a pot of coffee a little bit easier to make. When you have 6 digits in available credit, whats a $5 cup of coffee? Well thats the thinking that got me into the 10k in debt over the last 7 months. Like I said, nobodys fault but my own. When I needed something, I purchased the best quality. I didn't worry about it. When I wanted something bad enough, I just bought it. Life is too short, I would often think.
Well now that I lived like a spoiled rich kid for the almost a year, I need to cut back on spending and start paying off the debt. I've transfered much of it to low interest promos which will give me around a year to try and get out of debt. Over the course of that time, I will update and blog about which way the debt is moving and how it feels to be either more or less in debt. Wish me luck.
The overlooked "number of accounts with balance" fico formula
Posted by TheChosenOne, Apr 4 2009, 11:17 PM
Here is the blog entry in which I will disect the often overlooked formula that seems to weigh the most for the particular fico scorecard I'm currently on. I realize that some if not all the vets may already be aware of this part of the fico formula. This is more for the newer members.
Open Revolving accts/closed..............with balance.................result
35/8....................................................9/0......................-8 points
35/8....................................................8/0......................+8 points
36/9.....................................................10/0.....................-10 points
37/9..................................................12/0........................(no change)
38/9....................................................8/0.......................+10 points
38/9....................................................4/0.......................+11 points
These are the last score alerts from eq scorewatch. Here we can see that the score jumps and goes
back down by a fairly significant number of points when it hits a certain percentage of accounts with balances vs. open accounts (thats my theory, see 2nd paragraph below for other possibility). So when the 9th account that reported a balance put the percentage over 25% (25.7%), just like with utilization percentage, the score took a pretty decent hit (8 points). And when the number of accounts went back down to 8 (under 25% of open accts - 22.8% to be exact) the score jumped back up the same amount of points. So 25% seems to definitely be a benchmark in the formula. Note that I don't dare carry a balance on a closed account, so I can't tell the effects that would have. Hopefully if you have a balance on a closed accont, you pay it off quickly as it can really damage a credit score in more than one part of the fico formula.
The other possibility (or yet another part of the formula) would be total accounts period vs. ones with a balance. This theory would also fly, as when the 9th account out of 43 total put the percentage over 20% (20.9%). And when it went back down to 8, of course the percentage fell to below 20 (18.6%) and the score went back up. This also happened at the 10/45 ratio (22.2%).
My theory are that both are figured into this part of the fico formula, with active accts vs. ones with balances being the dominating factor. I will update this blog as time goes on to prove or disprove my theories. I will be paying my number of accounts with balances down to 3 total on my reports, keeping an eye on fico score movement along the way. I am expecting to see significant gains as the percentage passes 20%, 15%, 10% and maybe 5%. Stay tuned.
Update #1: Right before paying off a bunch of balances, I let a couple more report to see the point result, if any.. With 2 extra balances reporting and only 1 new account, there was no fico point movement, due to the ratio percentage still being over 25% (27.8%). However, we can see that IF total number (both closed and open) were taken into account, the 2 extra accounts reporting would put the ratio from 22% to over 25% (26.1%) reinforcing my theory that open accounts are the main factor in this part of the fico formula.
Update #2: A 38th account reports and balances paid down to 8, which brings the ratio down to below 25% (21.1%), and guess what happened? Yep, the exact same 10 points that were deducted a month ago are added back. The balances that zeroed out were all very small amounts (less than $100), further prooving that its not hitting on utilization at all, but the same ratio of accts w/ balance. The next test is the score reaction as the ratio falls under 20% in the next week.
Update #3: You can thank equifax for cancelling my scorewatch without my consent. For some reason they blocked my report access. After a lot of work, I was able to unblock it to start up a scorewatch with myfico.com, though I missed some marks (20% and 15%). Accounts with balances number lowered to 4 (10.5%) and my score increased 11 points. Not sure which milestone created the largest increase, but Im thinking 20%. Even though Equifax sabotaged this experiment, we can see that ratio of balances vs. total active accounts is a very powerful part of the fico formula.
My mounting debt (Update #1)
Posted by TheChosenOne, Feb 3 2006, 12:46 AM
I have had a request to post an update on my attempt to pay down my debt. Unfortanately, the reason why its taken me so long to post it is that... well you're not going to like what I'm about to confess. Now before you get all disapointed in me, because yes my debt has increased by a significant amount, it is for a very good reason....
I used to frequent the credit forums and now I find myself a habitual lurker in the business forums because last year I decided to start my own brick and mortar LLC business aka a business with a commerical location as compared to my sole proprietorship that I ran out of my home. This was a very exciting and risky move on my part, driven mostly by the economy. And before you say "but TCO the economy is still in the toilet", yes I know, you are correct but thats exactly the reason why it helped me.
You see I do agree with all the people that preach taking advantage of the down market by buying now and I also agree that the difference between a successful person and somebody who fails is that they lack the wisdom to know the right time to act. I was able to get a great deal on a commercial property lease. I was also able to take advantage of other businesses going out of business and I purchased my equipment and funishings from that. I believe that last year , and still going into this year, is an excellent time to take advantage of other businesses misfortune. And while that might seem cold, it has helped me save a ton of money.
That being said, I DO feel bad that I have not cut down on the luxury expenses. That is my fault, and while anybody who has attempted to start a new biz can tell you that you need to treat yourself in such stressful times to avoid a mental breakdown, I do feel bad about it. A lot of the time I just dont have the time to cook for myself, or I am too tired, so I order out. I still get the starbucks a few times a week. I still own 3 vehicles despite not needing 3 and telling myself I would sell one to pay off debt. Ive sunk a lot of my resources into the business and instead of paying off debt ive paid something for the business. Im a littled ashamed to admit that my debt has increased. I have suffered AA from a credit card because of it, but only one in the last 6 months. While I have gained weight and debt from the stress of the new business, I am nowhere near BK, and am proud of that. I have made mistakes but none of which have cost me a lot of money.
Bottom line is, I couldnt do any of this without creditboards. I am very proud to be a blogger on here and part of the community and friends with a lot of you. All I can say is cheer for me because I am a child of creditboards, and the increased debt is for the greater good down the road, hopefully not that far away. So, stay tuned, I am not done working my magic, fueled by CB. I also want to thank everybody that takes the time and reads my blog. It keeps me posting. I will update again soon.
on Finally.... about me