Quote:
Originally Posted by therotman
too many credit cards and and new credit cards will negatively effect your credit score. Even with no balance- they want to see just a few established cards that you use and pay on time.
If you are looking at buying a new house I wouldn't keep piling on new cards.
|
Agreed to a point - one thing that will help your FICO is having a low "utilization" % of available credit though. As with most things, there's a compromise. Sometimes the best thing to do is close accounts (to reduce the overall $ number of available revolving lines, even if utilization % is low), sometimes it's not (to show a lower % of utilization), sometimes it's to open new accounts, sometimes it's not. You have to research and determine what your most pressing need is at the time - for most, this is making DAMN sure they're not paying 20% or 25% or whatever the hell kind of criminal rate these guys are charging the indiscriminate these days...
Obviously the best thing to do is have one (or two) and simply keep a zero balance on it each month, but for those who find themselves carrying a balance, the best thing you can do is pay 0.0% APR and no fees. Doesn't matter how "wise to it" the banks are getting - there will always be someone out there willing to give you a 0% APR balance transfer, unless your credit is horrendous.
I'm just speaking from experience here. I've used the transfer method to good use in the past to rebuild after a layoff and resulting need to use my credit lines. It sucks, but it's called "making the best of a bad situation". I think that's more useful advice to some than simply looking down your nose at them and telling them what they probably already know (that the best thing to do is not carry a balance). I'm simply trying to provide some information that might actually have some real-world value, rather than snooty platitudes.