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Any negative for having too many CCs open?

Posted on 7/23/14 at 6:44 pm
Posted by TigerTatorTots
The Safeshore
Member since Jul 2009
81179 posts
Posted on 7/23/14 at 6:44 pm
Since I have really good credit, I'm looking to cash in on some of these sign up bonuses. Any negative for having too many CCs open that I don't use?
Posted by Teddy Ruxpin
Member since Oct 2006
39838 posts
Posted on 7/23/14 at 6:50 pm to
Open? No. The act of opening? Yes, but temporary. And you don't want to open a new line shortly before say, a car or home loan application.

Then from there its just an issuer specific decision if they want to extend you more credit, which has really nothing to do with your score at that point.

For example, I have 3 Chase Personal cards and 2 Chase business cards (and something like 10 credit cards total). For me to get a 6th card, I'll probably have to cancel one and replace it with whatever I'm getting, but another bank like Citi would probably approve me for whatever I wanted since I have none with them.
This post was edited on 7/23/14 at 6:54 pm
Posted by TigerTatorTots
The Safeshore
Member since Jul 2009
81179 posts
Posted on 7/23/14 at 7:10 pm to
We won't be opening a new line for about 6-8 months when we buy a new house. No cars for at least a year. I only have 3 cards, one being issued from my company so I'm not sure if that counts as one of mine despite having my name on it (I hope it doesn't b/c my manager approved my expense report late twice which caused late payments). Anywho...I'm an approved user on a 4th card, but that is one that my parents opened when I was born so I don't touch it. Looking to cash in on some of the cash back and rewards deals going on by signing up for 1 or 2
This post was edited on 7/23/14 at 7:11 pm
Posted by meansonny
ATL
Member since Sep 2012
26000 posts
Posted on 7/23/14 at 7:32 pm to
quote:

We won't be opening a new line for about 6-8 months when we buy a new house. No cars for at least a year. I only have 3 cards, one being issued from my company so I'm not sure if that counts as one of mine despite having my name on it (I hope it doesn't b/c my manager approved my expense report late twice which caused late payments). Anywho...I'm an approved user on a 4th card, but that is one that my parents opened when I was born so I don't touch it. Looking to cash in on some of the cash back and rewards deals going on by signing up for 1 or 2


Check your credit report to verify that an 'authorized user' account isn't affecting you.

If you're buying a home in 6-8 months, I wouldn't open up anything new. It's kind of near-sighted in terms of benefits (cash back rewards) and probably would have a negative effect on your score for the home purchase.

If you're not looking at buying in the next 18 months, go ahead and open up several or a few accounts. Credit scores indicate the ability to manage credit. Having 12 months active/used with nothing negative should help your score.

For the record, the only time you will see a significant impact on your credit report for too many open accounts is when you have an extremely high credit score and virtually nothing else is left to pull it down. Too many accounts open being the single most influential factor on your score is a sign that you are managing credit very well and the score should mirror that.
Posted by TigerTatorTots
The Safeshore
Member since Jul 2009
81179 posts
Posted on 7/23/14 at 7:34 pm to
quote:

Check your credit report to verify that an 'authorized user' account isn't affecting you.

I was told that this account is the reason why my credit score is over 800. My credit history is 25 years because of it (would only be 10 years if that account wasn't open). Plus its a $40,000/mo card so it really helps my utilization rate
Posted by Teddy Ruxpin
Member since Oct 2006
39838 posts
Posted on 7/23/14 at 7:39 pm to
quote:

one being issued from my company so I'm not sure if that counts as one of mine despite having my name on it (I hope it doesn't b/c my manager approved my expense report late twice which caused late payments).


This is on them not you.
Posted by meansonny
ATL
Member since Sep 2012
26000 posts
Posted on 7/23/14 at 7:55 pm to
That's what I've seen in the past.

You've got to be cautious with the word 'late payment' involving credit.
The consumer reports only care if it is 30, 60, 90, or 120 days late.

If that card helps your score, then I'm sure it can hurt your score if they screw the account up royally.

Good luck.
Posted by bubbz
Baton Rouge
Member since Mar 2006
22901 posts
Posted on 7/23/14 at 8:23 pm to
Tots:

The ideal amount of credit cards to have open is 3. Anything more than that you take a hit. You want your balances to be no more than 60% of the limits.

If your credit is strong, IE multiple car loans, mortgage history, revolving history, opening a credit card line before a mortgage app isn't a huge deal, however if you do not have a lot of history on your bureau, I would advise against it.

Take this from someone who has been trained by Equifax and is in the field.
Posted by VABuckeye
Naples, FL
Member since Dec 2007
36184 posts
Posted on 7/23/14 at 8:27 pm to
quote:

The ideal amount of credit cards to have open is 3. Anything more than that you take a hit. You want your balances to be no more than 60% of the limits.


Gotta disagree strongly. There is nothing wrong with having more accounts open if they are managed well. You do not take a hit to your score for having more than three credit cards. That is ludicrous.

You want your utilization at 20% or less. 60% is way too high and has an adverse affect on your score and your credit worthiness.
Posted by meansonny
ATL
Member since Sep 2012
26000 posts
Posted on 7/23/14 at 8:34 pm to
quote:


Gotta disagree strongly. There is nothing wrong with having more accounts open if they are managed well. You do not take a hit to your score for having more than three credit cards. That is ludicrous.

You want your utilization at 20% or less. 60% is way too high and has an adverse affect on your score and your credit worthiness


Cosigned.
20% utilization is ideal.
New accounts hurt... but eventually they show the ability to manage credit. The key is getting to the eventually without any hiccups.

I've seen 840 credit scores with the largest negative factor on the credit being too many open accounts.
I repeat... this is a good thing (when the worst thing a credit agency can say about you is too many open accounts).
Posted by bubbz
Baton Rouge
Member since Mar 2006
22901 posts
Posted on 7/23/14 at 9:20 pm to
Well I'm calling BS on both.

You do take a small hit with more than 3 cards opened. Whether you manage them well or not is a different story. Having a lot of available credit to tap into can show risk to a lender.

Your score will be the same whether you have 20% or 60% balance/limit ratio, however 60% is the threshold.
Posted by Joshjrn
Baton Rouge
Member since Dec 2008
28613 posts
Posted on 7/23/14 at 9:23 pm to
quote:

Your score will be the same whether you have 20% or 60% balance/limit ratio, however 60% is the threshold.


This is flat out incorrect.
Posted by bayoubengals88
LA
Member since Sep 2007
19871 posts
Posted on 7/23/14 at 10:11 pm to
quote:

Your score will be the same whether you have 20% or 60% balance/limit ratio, however 60% is the threshold.


Can you at least tell us where you're getting this from? Besides "expertise"...
Threshold is closer to 30% than 60%
Posted by TigerTatorTots
The Safeshore
Member since Jul 2009
81179 posts
Posted on 7/23/14 at 10:25 pm to
I've never heard the 60% threshold....I've always read it should be less than 30%
Posted by Golfer
Member since Nov 2005
75052 posts
Posted on 7/23/14 at 10:52 pm to
quote:

Your score will be the same whether you have 20% or 60% balance/limit ratio, however 60% is the threshold.


I was banking a good bit on a 0% teaser rate that brought my utilization to 45% when I paid that off and got a increase in my line of credit, it brought my utilization to 23%

Score went up 25 points.
Posted by LSUAfro
Baton Rouge
Member since Aug 2005
12775 posts
Posted on 7/24/14 at 1:11 am to
quote:

Posted by bubbz Well I'm calling BS on both. You do take a small hit with more than 3 cards opened. Whether you manage them well or not is a different story. Having a lot of available credit to tap into can show risk to a lender. Your score will be the same whether you have 20% or 60% balance/limit ratio, however 60% is the threshold.

You're wrong. Source: real life and every CC forum.
Posted by htownjeep
Republic of Texas
Member since Jun 2005
7635 posts
Posted on 7/24/14 at 8:09 am to
quote:

The ideal amount of credit cards to have open is 3. Anything more than that you take a hit. You want your balances to be no more than 60% of the limits.

This is sooooo wrong. Please stop spewing this around.
quote:

Take this from someone who has been trained by Equifax and is in the field.

Either a) their training is wrong b) you didn't pay attention during training or c) you're lying.

Personally, I keep around 20% at a maximum.

Keep it sub 35% according to Equifax

quote:

Are my balances too high relative to my total available credit limit?
Creditors prefer to see a lower ratio of how much debt you’re carrying compared with how much available credit you have on a particular account. Ideally, you’ll use less than 35% of the total credit limit on any particular account. For example, if your credit card has a maximum credit limit of $1,000, carrying a balance above $350 on that card could negatively affect your credit score.
Posted by htownjeep
Republic of Texas
Member since Jun 2005
7635 posts
Posted on 7/24/14 at 8:16 am to
quote:

You're wrong. Source: real life and every CC forum.

And Equifax
This post was edited on 7/24/14 at 8:17 am
Posted by lsujro
north of the wall
Member since Jul 2007
3969 posts
Posted on 7/24/14 at 10:14 am to
quote:

bubbz


to the OP, take 5 mins and do some research, and you will quickly see that everything this guy said is incorrect.

fwiw i currently have 5 cards and a 800+ FICO.
Posted by TigerTatorTots
The Safeshore
Member since Jul 2009
81179 posts
Posted on 7/24/14 at 1:02 pm to
What about thoughts of opening another card despite planning on buying a new house ~8 months from now? Bad idea?
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