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More credit cards = higher credit score?

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I searched but didn't see any answers, and read Bob W's spreadsheets. So I have 16 student loans, 1 CC AU reporting, 1 CC. All good pay history, AAOA 7 years (thanks student loans!) and all that. So I got a 2nd CC the other day. This would report as my 3rd on my CR (1 AU + 2 CCs).

 

I know a lot of folks pursue credit, does it make sense to get more cards? I'm interested in Citi Dividend because of the 5% cash back for gym membership. Same thing US Bank Cash+ and resteraunts/fast food. PenFed AMEX's for 5% on gas looks awesome.

 

I'm concerned having too much or getting too much credit will hurt me? Overall, I'd like to get more revolving credit because I plan to pay off all of my student loans, which presently makes up a bulk of my credit history.

 

Thoughts?

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I searched but didn't see any answers, and read Bob W's spreadsheets. So I have 16 student loans, 1 CC AU reporting, 1 CC. All good pay history, AAOA 7 years (thanks student loans!) and all that. So I got a 2nd CC the other day. This would report as my 3rd on my CR (1 AU + 2 CCs).

 

I know a lot of folks pursue credit, does it make sense to get more cards? I'm interested in Citi Dividend because of the 5% cash back for gym membership. Same thing US Bank Cash+ and resteraunts/fast food. PenFed AMEX's for 5% on gas looks awesome.

 

I'm concerned having too much or getting too much credit will hurt me? Overall, I'd like to get more revolving credit because I plan to pay off all of my student loans, which presently makes up a bulk of my credit history.

 

Thoughts?

 

Yes, having more cards should help your FICO score since you have so few. In the long run, I suggest opening one or two new ones each year so as to not put too much of a drag on your FICO score due to AAOA dipping with each new card and getting dinged for accounts less than one year old. It is probably a good idea to establish a relationship with American Express since they will backdate new accounts to the year of your first card with them, so later, this can be a nice tool to improve your AAOA. Be sure to occasionally charge something on each card to keep them from being closed due to inactivity. This is more important with bank cards, as credit unions are more forgiving, but you want at least one bank card as some FICO models give a benefit for the existence of a major bank card and its being used recently.

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I just added my first new card in over a year. As a consequence my AAOA decreased from about 2.7 to 2.3. And, of course, my youngest account is less than a month old instead of 15 months. Also, because of the low CL, my Utilization is unchanged at 11%.

 

So how bad a FICO hit did I take adding my fifth CC? It went up 46 points from 690 to 736.

Edited by cashnocredit

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I just added my first new card in over a year. As a consequence my AAOA decreased from about 2.7 to 2.3. And, of course, my youngest account is less than a month old instead of 15 months. Also, because of the low CL, my Utilization is unchanged at 11%.

 

So how bad a FICO hit did I take adding my fifth CC? It went up 46 points from 690 to 736.

 

As discussed elsewhere, this is due to being put into a different scorecard / bucket. Not everyone will see such results.

 

Bottom line is don't got wild adding new accounts or you will likely take a score hit.

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I'll probably add a new one every 6 months, good strategy?

 

Personally, I add two simultaneously every 12 to 14 months. One with a TU puller and one with an EQU puller. This way the two accounts are applied for with all accounts more than 12 months old and a good score for my current position and no inquiries showing less than 12 months old.

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I just added my first new card in over a year. As a consequence my AAOA decreased from about 2.7 to 2.3. And, of course, my youngest account is less than a month old instead of 15 months. Also, because of the low CL, my Utilization is unchanged at 11%.

 

So how bad a FICO hit did I take adding my fifth CC? It went up 46 points from 690 to 736.

 

As discussed elsewhere, this is due to being put into a different scorecard / bucket. Not everyone will see such results.

 

Bottom line is don't got wild adding new accounts or you will likely take a score hit.

 

 

Actually that most likely wasn't from a scorecard change. The original drop and new hypersensitivity to number of accounts reporting a balance was a scorecard change upon reaching exactly 4 years of age for the oldest account. The 46 point increase is mostly due to all my accounts no longer reporting a balance due to the 0 balance new WMD card while a smaller increment was caused by increasing the number of CCs from 4 to 5.

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I just added my first new card in over a year. As a consequence my AAOA decreased from about 2.7 to 2.3. And, of course, my youngest account is less than a month old instead of 15 months. Also, because of the low CL, my Utilization is unchanged at 11%.

 

So how bad a FICO hit did I take adding my fifth CC? It went up 46 points from 690 to 736.

 

As discussed elsewhere, this is due to being put into a different scorecard / bucket. Not everyone will see such results.

 

Bottom line is don't got wild adding new accounts or you will likely take a score hit.

 

 

Actually that most likely wasn't from a scorecard change. The original drop and new hypersensitivity to number of accounts reporting a balance was a scorecard change upon reaching exactly 4 years of age for the oldest account. The 46 point increase is mostly due to all my accounts no longer reporting a balance due to the 0 balance new WMD card while a smaller increment was caused by increasing the number of CCs from 4 to 5.

Yep, I'm pretty sure that any new account will put you into "seeking credit" scorecard. That much of an increase (without the removal of a negative) would have to be because with the $0 UTL reporting, you score higher than everyone else on that scorecard, or you again moved to another scorecard. 46 points is a hell of a jump IMO... I've never seen that much of a difference in score unless the change in UTL is quite HUGE.

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I just added my first new card in over a year. As a consequence my AAOA decreased from about 2.7 to 2.3. And, of course, my youngest account is less than a month old instead of 15 months. Also, because of the low CL, my Utilization is unchanged at 11%.

 

So how bad a FICO hit did I take adding my fifth CC? It went up 46 points from 690 to 736.

 

As discussed elsewhere, this is due to being put into a different scorecard / bucket. Not everyone will see such results.

 

Bottom line is don't got wild adding new accounts or you will likely take a score hit.

 

 

Actually that most likely wasn't from a scorecard change. The original drop and new hypersensitivity to number of accounts reporting a balance was a scorecard change upon reaching exactly 4 years of age for the oldest account. The 46 point increase is mostly due to all my accounts no longer reporting a balance due to the 0 balance new WMD card while a smaller increment was caused by increasing the number of CCs from 4 to 5.

Yep, I'm pretty sure that any new account will put you into "seeking credit" scorecard. That much of an increase (without the removal of a negative) would have to be because with the $0 UTL reporting, you score higher than everyone else on that scorecard, or you again moved to another scorecard. 46 points is a hell of a jump IMO... I've never seen that much of a difference in score unless the change in UTL is quite HUGE.

I'm pretty sure that the big jump was when my oldest account reached 4 years. A strong indicator is the "reason codes" FICO produces. Suddenly the major reasons were too many cards with balances and a short history. The former is highly variable but the later is because the new scorecard would have a range of "oldest account" and the bottom end of that range is the 4 year threshold I just crossed into.

 

Prior to reaching 4 years, variations in the number of cards with balances made a much smaller difference in FICO scores. Now the number of CCs you have also makes a difference but it is in what "bin" is used within a scorecard, rather than a different scorecard. No doubt 5 cards is a different bin than 4 and that would be consistent with BobWang's simulation charts. Also, the number of accounts reporting balances is binned and counts strongly when you are at the bottom of a >4y scorecard.

 

As time goes on, I'll have a TU FICO 08 to compare against as well as the EQ FICO. I'll also be able to shift the number of accounts reporting balances. From this it will become clearer what the relative importance is. Also, I don't think new accounts or Inqs will change scorecards but they definitely change bins within a scorecard.

 

This is also a great example of how useless FICO "reason codes" can be. Other than too many accounts with balances, which didn't change when I added the WM card*, the other reason codes were short credit history and recent accounts. One would rationally expect from those reason codes that adding the WM card would drop a FICO score rather than result in a 46 point jump.

 

* The reason code should instead be "no or too few cards reporting with zero balance" which did change when I added the WM card.

 

 

EtoA: Another opportunity to experiment is there due to the low CL on the Walmart card. I can easily see the effect on maxing a single card without affecting my overall Util. So I'm not going to seek a higher CL on it until I get to test this.

Edited by cashnocredit

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I just added my first new card in over a year. As a consequence my AAOA decreased from about 2.7 to 2.3. And, of course, my youngest account is less than a month old instead of 15 months. Also, because of the low CL, my Utilization is unchanged at 11%.

 

So how bad a FICO hit did I take adding my fifth CC? It went up 46 points from 690 to 736.

 

As discussed elsewhere, this is due to being put into a different scorecard / bucket. Not everyone will see such results.

 

Bottom line is don't got wild adding new accounts or you will likely take a score hit.

 

 

Actually that most likely wasn't from a scorecard change. The original drop and new hypersensitivity to number of accounts reporting a balance was a scorecard change upon reaching exactly 4 years of age for the oldest account. The 46 point increase is mostly due to all my accounts no longer reporting a balance due to the 0 balance new WMD card while a smaller increment was caused by increasing the number of CCs from 4 to 5.

Yep, I'm pretty sure that any new account will put you into "seeking credit" scorecard. That much of an increase (without the removal of a negative) would have to be because with the $0 UTL reporting, you score higher than everyone else on that scorecard, or you again moved to another scorecard. 46 points is a hell of a jump IMO... I've never seen that much of a difference in score unless the change in UTL is quite HUGE.

I saw almost a hundo when the last neg deleted off my EQ. Was sitting at 696 will AAOA 4yrs with only 1% uti on on 3 cc; when I had the last baddie deleted score shot up to 795 in one day and settled at 789. This was on myFICO score watch so take its for what it's worth. I'm assuming it was due to the combo of Clean CR + new bucket with 1% uti

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I just added my first new card in over a year. As a consequence my AAOA decreased from about 2.7 to 2.3. And, of course, my youngest account is less than a month old instead of 15 months. Also, because of the low CL, my Utilization is unchanged at 11%.

 

So how bad a FICO hit did I take adding my fifth CC? It went up 46 points from 690 to 736.

 

As discussed elsewhere, this is due to being put into a different scorecard / bucket. Not everyone will see such results.

 

Bottom line is don't got wild adding new accounts or you will likely take a score hit.

 

 

Actually that most likely wasn't from a scorecard change. The original drop and new hypersensitivity to number of accounts reporting a balance was a scorecard change upon reaching exactly 4 years of age for the oldest account. The 46 point increase is mostly due to all my accounts no longer reporting a balance due to the 0 balance new WMD card while a smaller increment was caused by increasing the number of CCs from 4 to 5.

Yep, I'm pretty sure that any new account will put you into "seeking credit" scorecard. That much of an increase (without the removal of a negative) would have to be because with the $0 UTL reporting, you score higher than everyone else on that scorecard, or you again moved to another scorecard. 46 points is a hell of a jump IMO... I've never seen that much of a difference in score unless the change in UTL is quite HUGE.

I'm pretty sure that the big jump was when my oldest account reached 4 years. A strong indicator is the "reason codes" FICO produces. Suddenly the major reasons were too many cards with balances and a short history. The former is highly variable but the later is because the new scorecard would have a range of "oldest account" and the bottom end of that range is the 4 year threshold I just crossed into.

 

Prior to reaching 4 years, variations in the number of cards with balances made a much smaller difference in FICO scores. Now the number of CCs you have also makes a difference but it is in what "bin" is used within a scorecard, rather than a different scorecard. No doubt 5 cards is a different bin than 4 and that would be consistent with BobWang's simulation charts. Also, the number of accounts reporting balances is binned and counts strongly when you are at the bottom of a >4y scorecard.

 

As time goes on, I'll have a TU FICO 08 to compare against as well as the EQ FICO. I'll also be able to shift the number of accounts reporting balances. From this it will become clearer what the relative importance is. Also, I don't think new accounts or Inqs will change scorecards but they definitely change bins within a scorecard.

 

This is also a great example of how useless FICO "reason codes" can be. Other than too many accounts with balances, which didn't change when I added the WM card*, the other reason codes were short credit history and recent accounts. One would rationally expect from those reason codes that adding the WM card would drop a FICO score rather than result in a 46 point jump.

 

* The reason code should instead be "no or too few cards reporting with zero balance" which did change when I added the WM card.

 

 

EtoA: Another opportunity to experiment is there due to the low CL on the Walmart card. I can easily see the effect on maxing a single card without affecting my overall Util. So I'm not going to seek a higher CL on it until I get to test this.

Some good stuff in here. Concise and informative. Thank you :wave:

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Visa2 reported 0 balance. Now down to 3 out of 5 cards with balances. FICO up again to 754. Dropping the number of cards with zero balances from 0 to 2 made a huge change in FICO, from 690 up to 754, a 64 point increase. Details and history in the "Experiment" thread.

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I had a 30 point increase on the first of this month on my EQ account and for the life of me couldn't figure out why because nothing else had changed...until i read this post.....my CIBC Visa turned 6 yrs old on April the 1st....Gawd I love this forum, thanks for the information :)

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5 is a magic number, when it comes to major revolving trade lines.

 

Do store cards fall under major revolving trade lines?

No.

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