Credit Card Usage at 30% on all Cards?
Guest: JoyJoy
Credit Expert (100+ Posts)
Post subject: Credit Card Usage at 30% on all Cards?
Posted: Sat Sep 16, 2006 10:52 am
Mouse,
I understand now. I really thought I HAD to keep my usage to 30% on ALL cards. I do believe I need to stop reading so much about moving my debt and pay it down and off as soon as possible!
Thanks Mouse! You're not an IDIOT!! You're always posting and helping people.
Alecia
_________________
J~J
"You may never know what results come from your action. But if you do nothing, there will be no result." Mahatma Gandhi
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: mouse
SENIOR MEMBER (Member for 2 yrs.+)
Posted: Sat Sep 16, 2006 5:04 pm
JoyJoy wrote:
Mouse,
I understand now. I really thought I HAD to keep my usage to 30% on ALL cards. I do believe I need to stop reading so much about moving my debt and pay it down and off as soon as possible!
Thanks Mouse! You're not an IDIOT!! You're always posting and helping people.
Alecia
Some people think I am an IDIOT and all I do is LIE
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: JoyJoy
Credit Expert (100+ Posts)
Posted: Sat Sep 16, 2006 7:15 pm
I was always taught don't worry about what people say if you know you're telling the truth! Do other people pay your bills?
Alecia
_________________
J~J
"You may never know what results come from your action. But if you do nothing, there will be no result." Mahatma Gandhi
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: hdporter
Credit Expert (100+ Posts)
Posted: Sun Sep 17, 2006 8:46 am
Alecia,
I apologize that I haven't been able to reply before this, however, looking for 7 hr turnaround is a bit unrealistic, don't you think
I respect mouse's position on FICO. However, I think that anyone with a FICO below 720 should give some thought about it. Dropping your score by 20 points because of one or two accounts that move above 40% utilization could preclude you from getting the best rates and highest balance offers. And, if your score is below 700, there's little doubt in my mind that the lower your FICO runs the more you'll pay in interest on any cards that aren't at promo rates or, for the matter, on mortgage products.
I agree that it's ideal to maintain a limit number of accounts in general, particularly those with balances. However, my scores are at 730 (with 6 reported delinquent payements 5+ years ago) despite the fact that I have 12 accounts currently reporting with balances.
If you need to open another account in order to keep your interest charges to a minimum, I think it's a prudent move. Of course, if you can manage to use existing accounts, that might be the way to go given that you appear to have a decent amount of new credit activity in the last year (with a very recent new account opening). I find that if you can space openings out by at least 3-4 months, you stand a stronger chance of approval with better likelihood of a high limit (nothing hard and fast in that, however).
I think it's worthwhile to consider taking an account up to just under 40% utilization. However, that doesn't give you sufficent room to handle the tax transfer with just one card. I think opening a new Discover a/c is your best option.
Since the Discover offer likely has a 3% bt fee attached, you might wish to wait to make the transfer until after you receive your card and know your limit. It's a decent precaution in case they only come through with a $5K limit. If Discover doesn't come through with the $10K limit that would be desirable to handle this tax bill, you can take advantage of one of your existing card offers to take up anything that otherwise would take you over 40% on the Discover.
Finally, there's some concern over how to structure the transaction. If Discover will allow you to use a "BT" check to pay your taxes directly and give you the benefit of the BT offer, that's ideal -- since you only face one BT fee. If it's necessary for you to route the payment through another credit card, you're at some risk.
If you pay the taxes with another credit card, and then do a BT from Discover, the BT will first go to any promotional rate balance while the tax charge will accrue interest at the current stated rate. If you have a promotional rate and duration on purchases on the alternate card that's as strong as your rate on any current balance on that other card, then this isn't a problem. However, if purchases will draw a higher rate or a shorter promo term, then you need to take care to structure this to your best advantage.
- Harry
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Credit Expert (100+ Posts)
Post subject: Credit Card Usage at 30% on all Cards?
Posted: Sat Sep 16, 2006 10:52 am
Mouse,
I understand now. I really thought I HAD to keep my usage to 30% on ALL cards. I do believe I need to stop reading so much about moving my debt and pay it down and off as soon as possible!
Thanks Mouse! You're not an IDIOT!! You're always posting and helping people.
Alecia
_________________
J~J
"You may never know what results come from your action. But if you do nothing, there will be no result." Mahatma Gandhi
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: mouse
SENIOR MEMBER (Member for 2 yrs.+)
Posted: Sat Sep 16, 2006 5:04 pm
JoyJoy wrote:
Mouse,
I understand now. I really thought I HAD to keep my usage to 30% on ALL cards. I do believe I need to stop reading so much about moving my debt and pay it down and off as soon as possible!
Thanks Mouse! You're not an IDIOT!! You're always posting and helping people.
Alecia
Some people think I am an IDIOT and all I do is LIE
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: JoyJoy
Credit Expert (100+ Posts)
Posted: Sat Sep 16, 2006 7:15 pm
I was always taught don't worry about what people say if you know you're telling the truth! Do other people pay your bills?
Alecia
_________________
J~J
"You may never know what results come from your action. But if you do nothing, there will be no result." Mahatma Gandhi
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: hdporter
Credit Expert (100+ Posts)
Posted: Sun Sep 17, 2006 8:46 am
Alecia,
I apologize that I haven't been able to reply before this, however, looking for 7 hr turnaround is a bit unrealistic, don't you think
I respect mouse's position on FICO. However, I think that anyone with a FICO below 720 should give some thought about it. Dropping your score by 20 points because of one or two accounts that move above 40% utilization could preclude you from getting the best rates and highest balance offers. And, if your score is below 700, there's little doubt in my mind that the lower your FICO runs the more you'll pay in interest on any cards that aren't at promo rates or, for the matter, on mortgage products.
I agree that it's ideal to maintain a limit number of accounts in general, particularly those with balances. However, my scores are at 730 (with 6 reported delinquent payements 5+ years ago) despite the fact that I have 12 accounts currently reporting with balances.
If you need to open another account in order to keep your interest charges to a minimum, I think it's a prudent move. Of course, if you can manage to use existing accounts, that might be the way to go given that you appear to have a decent amount of new credit activity in the last year (with a very recent new account opening). I find that if you can space openings out by at least 3-4 months, you stand a stronger chance of approval with better likelihood of a high limit (nothing hard and fast in that, however).
I think it's worthwhile to consider taking an account up to just under 40% utilization. However, that doesn't give you sufficent room to handle the tax transfer with just one card. I think opening a new Discover a/c is your best option.
Since the Discover offer likely has a 3% bt fee attached, you might wish to wait to make the transfer until after you receive your card and know your limit. It's a decent precaution in case they only come through with a $5K limit. If Discover doesn't come through with the $10K limit that would be desirable to handle this tax bill, you can take advantage of one of your existing card offers to take up anything that otherwise would take you over 40% on the Discover.
Finally, there's some concern over how to structure the transaction. If Discover will allow you to use a "BT" check to pay your taxes directly and give you the benefit of the BT offer, that's ideal -- since you only face one BT fee. If it's necessary for you to route the payment through another credit card, you're at some risk.
If you pay the taxes with another credit card, and then do a BT from Discover, the BT will first go to any promotional rate balance while the tax charge will accrue interest at the current stated rate. If you have a promotional rate and duration on purchases on the alternate card that's as strong as your rate on any current balance on that other card, then this isn't a problem. However, if purchases will draw a higher rate or a shorter promo term, then you need to take care to structure this to your best advantage.
- Harry
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
posted by CardRatings.com at 9:23 AM
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