Jonesey07
4 of a Kind
So is there a benefit to increasing your credit limit? I'm sitting at 2k limit on my CC. I don't ever plan on using that much and I always pay the balance before the due date.
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Credit Discussion Thread (4 Viewers)
- Thread starter Payback
- Start date
Anthony Martino
Royal Flush
The more available credit you have, the better your score
Someone who is using 10% of their credit is scored better than someone using 90% who will be a greater risk
Jonesey07
4 of a Kind
Interesting. I'll have to consider calling to increase my limit. Not that I need credit any time soon, but is it a ding to call and have them up the limit at all?
Anthony Martino
Royal Flush
You only get dinged if they do a hard pull I believe. Since you already have an account with them a credit increase may be an internal review or a soft pull
Jimulacrum
Full House
Even if you lose points for requesting the credit line increase, it'll just be a temporary dip, while the points you gain from utilizing a smaller percent of your credit line will remain after the dip goes away. Plus, you'll have additional credit available on the odd chance you need it in a pinch.
Bumping an old thread.
I've had a VERY rocky financial past, and am quite honestly, terrible when it comes to this. My wife, bless her, is 1000% worse than I am. At one point, I think my credit score was near 400, if that is even possible. we had a foreclosure in 2006 (when the market dropped), and it's been an uphill climb ever since.
Current day, I've managed to work my ass off for the past few years. I started applying for some credit cards in 2017-2018 to build credit, getting cards with $300-$500 limits. I did my best to pay them on time, but then a few things happened which derailed me again. The COVID period was REALLY good for us, and it game me a new start. I've been BEYOND diligent now paying everything on time (not necessarily paying things off, but on time). As payments continued, some of my cards started upping the credit limits. I've been able to keep everything paid on-time with no flags for the past 4 years now.
Fast-forward to today, and I am now HYPER-vigilant to get everything paid off. My credit score is now in the upper 600's/ low 700's (depending on which site and which score is being used), so not quite there yet .. but I applied for a 0% interest card with 0% on balance transfers for 18 months. Assuming I a) wouldn't get approved, or b) would get approved with a low credit limit like always .. I figured I could move a low-balance card there, and pay it off. To my surprise, I was approved for an amount that essentially covered 80% of my credit card balances (some are close to maxed out). I jumped on the opportunity to transfer the biggest balance cards to the new card and get this debt under control.
not really a brag, as I am still not anywhere close to where I should be financially. Should I take as long as possible to pay that card off, given that it has 0% interest until April 2025 (meaning, take the total balance transferred divided by 17, and make those even payments until its paid off), or do I take the opportunity to get it paid off faster, thus showing that I am not keeping balances on credit cards which should then increase the credit score more.
Ideally, I want little debt (I'll never get the mortgage paid off before we move one day), so I am asking all you financially savvy folks on here what you think is the best path forward?
I've had a VERY rocky financial past, and am quite honestly, terrible when it comes to this. My wife, bless her, is 1000% worse than I am. At one point, I think my credit score was near 400, if that is even possible. we had a foreclosure in 2006 (when the market dropped), and it's been an uphill climb ever since.
Current day, I've managed to work my ass off for the past few years. I started applying for some credit cards in 2017-2018 to build credit, getting cards with $300-$500 limits. I did my best to pay them on time, but then a few things happened which derailed me again. The COVID period was REALLY good for us, and it game me a new start. I've been BEYOND diligent now paying everything on time (not necessarily paying things off, but on time). As payments continued, some of my cards started upping the credit limits. I've been able to keep everything paid on-time with no flags for the past 4 years now.
Fast-forward to today, and I am now HYPER-vigilant to get everything paid off. My credit score is now in the upper 600's/ low 700's (depending on which site and which score is being used), so not quite there yet .. but I applied for a 0% interest card with 0% on balance transfers for 18 months. Assuming I a) wouldn't get approved, or b) would get approved with a low credit limit like always .. I figured I could move a low-balance card there, and pay it off. To my surprise, I was approved for an amount that essentially covered 80% of my credit card balances (some are close to maxed out). I jumped on the opportunity to transfer the biggest balance cards to the new card and get this debt under control.
not really a brag, as I am still not anywhere close to where I should be financially. Should I take as long as possible to pay that card off, given that it has 0% interest until April 2025 (meaning, take the total balance transferred divided by 17, and make those even payments until its paid off), or do I take the opportunity to get it paid off faster, thus showing that I am not keeping balances on credit cards which should then increase the credit score more.
Ideally, I want little debt (I'll never get the mortgage paid off before we move one day), so I am asking all you financially savvy folks on here what you think is the best path forward?
Take advantage of the 0% as much as possible, but try not to utilize more than 40% of the card limit.
Therefore, if its a $10K limit, and you transferred over $8K at 0%, pay down 4k aggressivley and get to a $4K or below balance, and pay that off slowly as possible while you utilize the benefit of 0%.
ThinkingFold
Flush
The only thing I have to add is that that above is unfortunately true. Recently had a 25 point drop in my credit score which sent me into a panic. After some research, it was because I had the audacity to pay off my car.
Sooo .. I assume paying off credit cards = increased score; while paying off cars and houses has a temporary negative blip on credit .. so to speak?The only thing I have to add is that that above is unfortunately true. Recently had a 25 point drop in my credit score which sent me into a panic. After some research, it was because I had the audacity to pay off my car.
Thanks.
I will say, outside of my Costco card that I use for everything, and do pay off monthly, this new card will now be the ONLY card carrying a balance moving forward too. I'll probably make some small transactions on the cards periodically ($100 and under), and pay them off, just so they don't cancel/close them on me too.
Mark
If it’s carrying a balance utilizing the promo they won’t close it on you.
No, all of the other cards that will now have $0 balances
Yeah good call.
You don’t want them closed bc if one card has been with you a long time, it helps your score with long term account length.
ThinkingFold
Flush
Yes.
I post the below in a no way shape or form as a brag but show what I am talking about. A month after my last car payment, I saw a significant drop. I panicked and was thinking identity fraud but after many calls and research it turned out that since I had one less line of credit, that dropped my number. It climbed back but best I can tell, regularly made car/mortgage payments = good debt relating to credit scores.
And once you hit 720 for most banks. Some 740. It’s no different than 850.
A 722, 744, 788 is going to be graded the same as 800+.
750+ Just allows you more margin of movement/ups and down.
ThinkingFold
Flush
Hmmmm, guess I do not need to be so concerned about paying things off going forward then.
I agree with what doublebooyah85 mentioned above about credit utilization. But your credit utilization is spread out amongst all your cards and not just one so I would focus on finding the balance to pay down the higher interest debts while working on paying off the balance transfer. You also need to consider that if you do not pay off the balance transfer within 18 months there most likely is a clause that states the balance transfer will accrue interest and be applied if not paid in full by XX date.
Sounds like you are on the right path though and are doing a great job.
Sounds like you are on the right path though and are doing a great job.
Yeah, once I get the transfers done, I will be paying off all of the other cards, so, this new card will be the only one with a "standing" balance. All other cards will have essentially a $0 balance, again, used sparingly just to show that I am using the credit and paying it off.
One day, the hope is that my score starts with an "8" and I can apply for a car loan / mortgage and know I'm getting the "best" rates.
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Best path forward is not to use ANY of the credit you've freed up when you transfer balances to the 0% card. It sounds like you both have some habits to break here.
Be hyper focused on paying the remaining 20% with interest as fast as possible, and then dump everything possible to the 0% card. Read the fine print and make sure your initial balance interest isn't auto applied at the end of the promotional period, if so, make sure you pay it off a month early. Credit card companies are evil.
There are plenty of spreadsheets out there that can help figure out your snowball or avalanche method - and assure that you meet your timeline.
Good luck - being free of credit card debt is the most liberating feeling in the world.
Put all you can against any credit card and get those buggers paid off! Once you pay get one paid off you can get on a roll and pay the next one off. I do not follow Dave Ramsey to a tea since I got out of debt years ago my own way but it was pretty similar. to Ramsey's plan. Once you become debt-free you then begin to experience the power of what money can do for you and your loved ones.
DO NOT play the credit card game. You will lose in the end. Chasing the 0% and balance transfers can get you in trouble, eventually
Credit scores? My score is high but realistically the next credit score I would like to have is zero! Credit is a necessary evil for some but try and stay away from it. Once you have your dollars working for you instead of the credit card companies your life really becomes less complicated.
DO NOT play the credit card game. You will lose in the end. Chasing the 0% and balance transfers can get you in trouble, eventually
Credit scores? My score is high but realistically the next credit score I would like to have is zero! Credit is a necessary evil for some but try and stay away from it. Once you have your dollars working for you instead of the credit card companies your life really becomes less complicated.
Thanks. I've heard "stories" when not using them at all, the credit card companies start closing your accounts since they aren't getting any money out of you any more.
and yes, working really hard on breaking these bad habits.
Yeah, once I get the transfers done, I will be paying off all of the other cards, so, this new card will be the only one with a "standing" balance. All other cards will have essentially a $0 balance, again, used sparingly just to show that I am using the credit and paying it off.
One day, the hope is that my score starts with an "8" and I can apply for a car loan / mortgage and know I'm getting the "best" rates.
I keep two lines open currently and just charge gas on one, groceries on another and pay them off immediately once the transaction clears within a few days. I try to make sure I keep it in the back of my mind if I dont have money to pay it off within 3 days do I really need it.
Nah, they don't close them. At least not in my experience. I've got 6-7 that get used once a year. The annual membership fee, then we call and ask them to waive it, if they won't, we threaten to cancel and they waive it.
We use one card, airline branded, and pay it off each month. Zero other debt. Couldn't care less what my credit score is, haven't needed it for anything other than changing electric/Internet providers in over 5 years.
Thanks all. I like my Costco card, as the rewards on it are very nice. I plan on keeping that one as our primary card, and I already have that set to auto-pay the full balance every month. I'll keep another one for the kids gas tanks and do the same.
It's funny, my parents are super savers and super with credit. I suck. my brother is good. I have 2 boys, one who doesn't want/spend anything, and the other who can't spend his $ fast enough. I need to work on him fast before he turns out like me.
It's funny, my parents are super savers and super with credit. I suck. my brother is good. I have 2 boys, one who doesn't want/spend anything, and the other who can't spend his $ fast enough. I need to work on him fast before he turns out like me.
I carry an AMEX Gold which I use for business and all personal expenses which is paid off every month. I also have a debit card from my Credit Union just in case. Other than that I carry no other credit cards.
@Craig is correct, they will not close it if you use it at least once per year although I did have an old card that I did not use and it took them over 6 years to close. Realistically, let them close it!
@Craig is correct, they will not close it if you use it at least once per year although I did have an old card that I did not use and it took them over 6 years to close. Realistically, let them close it!
ThinkingFold
Flush
Good luck. I have a daughter who spends her entire college allowance within 20 minutes of receiving it
If it weren't for the meal plan, she'd starve.
The only card that won't waive it is the airline card. But it comes with a flight credit annually so it's effectively a wash (+$50 in my favor).Noted
We haven't paid a membership fee in many years.
HAve you tried it with AMEX?
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