6 new credit cards in the past 6 months...oops??

[aroberson]

I recently have been working on getting my credit score higher and also want to have $100k in available credit (maybe a dumb thing to do).  In doing so I have gotten about 6 new credit cards in the past 6 months.  All of them have zero balance, about $30000 in available credit, I recently noticed my equifax dropped 16 points.  I assume this is from the inquiries and new accounts?  avg account age is 2yrs 8 months.  Should I close any of the new accounts to increase my credit age?  Or just be patient and wait for the accounts to age and the inquiries to age.

 

I am looking to buy a car next year, and maybe refinance my mortgage, and really want a 750+ score before I do so

[cv91915]

It's from new accounts, not inquiries, and closing accounts won't do anything for you.  AAoA includes closed accounts.

 

The time for building a thick file is when your AAoA is low, so unless you have a bunch of cards with annual fees that aren't outweighed by their benefits, keep them open forever, manage them well, and enjoy the benefits of having lots of positive open accounts.

 

 

Edited January 30, 2020 by cv91915

[aroberson]

30 minutes ago, cv91915 said:

It's from new accounts, not inquiries, and closing accounts won't do anything for you.  AAoA includes closed accounts.

 

The time for building a thick file is when your AAoA is low, so unless you have a bunch of cards with annual fees that aren't outweighed by their benefits, keep them open forever, manage them well, and enjoy the benefits of having lots of positive open accounts.

 

 

Thank you for the feedback!  I do enjoy seeing the zero balance, all my cards for no annual fees.  I am working on paying the debt I had from previous bad habits, and learning how to use a CC as a tool to gain benefits, not debt. 

[shifter]

Don't worry about temporary blips on the radar. It's likely your score dropped because of a combination of the new accounts as well as a young  age  with a potentially thin file so 6 new accounts would drop your average age considerably. Just focus on paying down that debt and that should help your score a lot more than the 16 points that you lost.

[aroberson]

35 minutes ago, shifter said:

Don't worry about temporary blips on the radar. It's likely your score dropped because of a combination of the new accounts as well as a young  age  with a potentially thin file so 6 new accounts would drop your average age considerably. Just focus on paying down that debt and that should help your score a lot more than the 16 points that you lost.

Thank you for the advice!  I am definitely will continue to do so.  The only thing that sucks right now is I am trying to refinance my debt consoldation loans at 12.8% APR, would really like a APR of 6% or so, but no one will approve me, should I look to a credit union?

[pacemaker67]

I am in the same mode now, rebuilding and headed towards clean reports in a year (or less).  I have gathered a several cards with no AF's in the last 6 months that may or may not grow (aside from my two NFCU cards).  Some I use regularly (Amazon) and some just a small charge a month paying in full as I go.  They are giving me a brand new history and though each added card lowers my AAoA, I have no choice.  My AoAA will be coming down anyway when my old derogs go away. 

 

In short, I ignore the score fluctuations (EQ is the worst) as I know the general trend is higher. 

[shifter]

Possibly. What's wrong with your reports? Can you utilize 0% BT offers to offload some of that high interest debt? 

[aroberson]

1 hour ago, shifter said:

Possibly. What's wrong with your reports? Can you utilize 0% BT offers to offload some of that high interest debt? 

• Time since most recent trade in derogatory status opened is too short
• Change in bankcard balances relative to the average bankcard balance over a 24 month period is too high.
• Time since most recent inquiry is too short.
• Length of time student loan trades in repayment status have been established is too recent or unknown.

Have one 30 day late that is over a year old.  I have 31K though in consolidation debt,  I really would like to make just one monthly payment.  Seems like my bank approved me for a loan, but it is a higher APR

[hegemony]

congrats!!!!

[shifter]

The 30 DL is definitely hurting you. You're not going to get a good interest rate on a personal loan because it's completely unsecured. Your best option would be getting approved for credit cards that offer 0% BT. I'm not sure what cards you got in the last 6 months, but are they all low limit cards with no benefits?

[aroberson]

2 hours ago, shifter said:

The 30 DL is definitely hurting you. You're not going to get a good interest rate on a personal loan because it's completely unsecured. Your best option would be getting approved for credit cards that offer 0% BT. I'm not sure what cards you got in the last 6 months, but are they all low limit cards with no benefits?

 

Relatively low?  I think mostly 1000-3000 limits, my Discover is the highest limit of 18k

[hegemony]

28 minutes ago, aroberson said:

 

Relatively low?  I think mostly 1000-3000 limits, my Discover is the highest limit of 18k

time to stop accumulating low limit turds. if any of these are will issuers that combine limits, consider that. Also, instead of moving debt around, start paying off the highest APR as fast as possible. Adding another new tradeline just because you want "one payment" is just a form of diversion from the primary problem.

[aroberson]

28 minutes ago, hegemony said:

time to stop accumulating low limit turds. if any of these are will issuers that combine limits, consider that. Also, instead of moving debt around, start paying off the highest APR as fast as possible. Adding another new tradeline just because you want "one payment" is just a form of diversion from the primary problem.

 

Yes, I will look into combining limits.  and I am not adding these new cards for moving debt per se, just wanted to have $100k available credit

[shifter]

You can try a CU for a personal loan at a better rate. Try NFCU if you are eligible. 

[aroberson]

17 hours ago, shifter said:

You can try a CU for a personal loan at a better rate. Try NFCU if you are eligible. 

I tried WF for a personal loan and was denied, interest rates weren't that great anyway

[shifter]

WF is not a CU.

 

actually to be honest, if I had to pick the worst place to go for a personal loan, it might be WF. WF is super conservative and pretty much useless for credit.

 

big banks just don't really do personal loans. too high risk for them. CU is your best bet.

[aroberson]

On 1/31/2020 at 10:57 AM, shifter said:

WF is not a CU.

 

actually to be honest, if I had to pick the worst place to go for a personal loan, it might be WF. WF is super conservative and pretty much useless for credit.

 

big banks just don't really do personal loans. too high risk for them. CU is your best bet.

Yes I know I just unfortunately do my banking with WF right now.  I will be going to look at a CU soon though

[cashnocredit]

On ‎1‎/‎30‎/‎2020 at 7:09 AM, aroberson said:

• Time since most recent trade in derogatory status opened is too short
• Change in bankcard balances relative to the average bankcard balance over a 24 month period is too high.
• Time since most recent inquiry is too short.
• Length of time student loan trades in repayment status have been established is too recent or unknown.

Have one 30 day late that is over a year old.  I have 31K though in consolidation debt,  I really would like to make just one monthly payment.  Seems like my bank approved me for a loan, but it is a higher APR

Interesting. That reason would apply to a trended data credit score suggesting some internal scoring or use of VantageScore. Where did those reason codes come from? You mentioned trying to combine debt consolidation loans. It that were it's from? What bank?

 

As an aside, you mentioned that all your credit cards are reporting zero balances. This actually reduces FICO scores. They like to see all cards but one reporting zero balance and a small balance on the last. It's good to use CCs in this way just make sure you PIF. If you prepay, make sure to leave a small balance on it to optimized FICO scores.

[aroberson]

1 hour ago, cashnocredit said:

Interesting. That reason would apply to a trended data credit score suggesting some internal scoring or use of VantageScore. Where did those reason codes come from? You mentioned trying to combine debt consolidation loans. It that were it's from? What bank?

 

As an aside, you mentioned that all your credit cards are reporting zero balances. This actually reduces FICO scores. They like to see all cards but one reporting zero balance and a small balance on the last. It's good to use CCs in this way just make sure you PIF. If you prepay, make sure to leave a small balance on it to optimized FICO scores.

 

Yes it was from a debt consolidation company, Do not remember the bank specifically.  I also got these interesting codes from upgrade.com, Blue Ridge Bank, N.A.  They used TransUnion, and SageStream LLC, anyone ever hear of that?

 

High number of recent applications for credit.

High number of recently approved applications.

High requested loan amount in relation to income.

High number of installment accounts recently opened

 

I asked Lightstream about my denial, and they said they do not consider that I will be paying off any existing personal loans with the new loan, so that is why I was denied with a higher than average credit score.  I actually had a way worse credit score when I got my original loan.

[cashnocredit]

35 minutes ago, aroberson said:

 

Yes it was from a debt consolidation company, Do not remember the bank specifically.  I also got these interesting codes from upgrade.com, Blue Ridge Bank, N.A.  They used TransUnion, and SageStream LLC, anyone ever hear of that?

 

High number of recent applications for credit.

High number of recently approved applications.

High requested loan amount in relation to income.

High number of installment accounts recently opened

 

I asked Lightstream about my denial, and they said they do not consider that I will be paying off any existing personal loans with the new loan, so that is why I was denied with a higher than average credit score.  I actually had a way worse credit score when I got my original loan.

Except for the third, these are typical reason codes for FICO scoring. FICO doesn't know about income or requested loan amounts. So these reason codes are a mix of FICO score codes and application specific info.

 

It's also possible the 24 month balance trend info reported earlier was from a custom scoring algorithm the bank used. Wouldn't surprise me though I haven't seen that reason code before.

 

One thing to consider. Lenders, especially online ones,  of unsecured installment loans have been seeing defaults significantly exceeding what FICO scores predicted. They are pulling in their horns and not extending credit nearly as easily as just a few years ago and factoring in more than FICO scores.

[aroberson]

37 minutes ago, cashnocredit said:

Except for the third, these are typical reason codes for FICO scoring. FICO doesn't know about income or requested loan amounts. So these reason codes are a mix of FICO score codes and application specific info.

 

It's also possible the 24 month balance trend info reported earlier was from a custom scoring algorithm the bank used. Wouldn't surprise me though I haven't seen that reason code before.

 

One thing to consider. Lenders, especially online ones,  of unsecured installment loans have been seeing defaults significantly exceeding what FICO scores predicted. They are pulling in their horns and not extending credit nearly as easily as just a few years ago and factoring in more than FICO scores.

Thank you for the feedback.  I am going to let my accounts age and try in 3 to 4 months.  My auto loan will also be paid off so I am sure that will help as well.