Ask Lemmy

Forget the credit card, tell me you're on anxiety meds.

As somebody who lives in country where credit cards are mostly used when going abroad for a vacation, this whole comment section is wild.

I don't know what I'm reading.

Here people mostly use debit cards, and we don't worry about things like credit scores or whatever. Also these cards tend to be free. At the end, they just give you a convenient way of paying with money you actually own.

Why would anyone buy normal stuff using credit? I get it for big purchases as a house or a car. But why go into debt for groceries or a new laptop?

You can easily get your credit score from any number of places, just do a google search or like call your bank. They’re never gonna be the same but they are usually within 5-10 points depending on the source.

But the real question is: why the hell were you opening so many credit cards in the first place?

Was it dumb? Yes

Is it easily corrected with some on time payments over the course of 6 months? Yes

They cacel each other out. You good

You're financially ruined.

find one that has no fees. pay it off every month. it doesn't matter what your credit limit is

Well you don't have an 830 credit score anymore but it's probably not too bad, chill though lol

Opening and closing a new accounts has literally no effect on your credit score.
The credit agencies pulling your report has a pretty minimal and very short lived.
Your score was an 830. I'll be surprised if it dips below 800. And that is still exceptional.

Unless you have an immediate need to get a really good interest rate, you should not lose any sleep over this.

Just cancel that Amex card and get another one, but before you get too comfy with it, consider cancelling it and getting another one.

I have a chase sapphire reserve (visa) that has a credit limit of $24,000. I don't understand why you keep picking cards with low credit limits. Do your research first then apply. Plus credit limits are based on your history with the bank and your annual income. If you have a low income, then they won't approve a large credit limit.

Also do you not read the sign on the stores you shop at? Pretty sure they advertise which card network they accept.

You can also literally call customer service and ask for the stipulations for an increase.

Credit cards are not your clothes.

Is your name Chidi Anagonye?

Why are you canceling them instead of just asking for an increased credit limit?

oh that’s right we don’t have a credit card or travel Lemmy yet. Okay, take down a few notes.

First you haven’t done anything terrible. Probably you’ve knocked your credit score down about 10 or 15 points. Not because of the opening and closing, but because multiple hard inquiries of your credit can cause the score to drop. That will repair itself over the next six months.

Something good to know is that American Express cards will only give you their sign-up bonus once per lifetime per person per card. I know that Chase will let you reapply two years after you drop a card and will give you the bonus, and I believe that’s the standard for other Visa cards or MasterCard.

I strongly recommend that you look at cards based on the rewards plan that they’ll provide you and the amount of spending required for you to be able to get the reward. I own several businesses so a $4000 or a $6000 spend is not a big deal for me over three months, But when I didn’t have that, I would need to figure out if I could make that spend over the required time period and go one card at a time. so back in my early days I was getting one card every three or four months, and then canceling cards about a year or two in, and then reapplying for them two years later.

I know that sounds complicated, but when you wanna fly to Australia, free and business class, and you don’t have a lot of money, that’s how you work the system.

Something good to know is there are essentially three tiers of credit cards. There are basic cards that will give you a lower reward, have a low spending requirement, and are generally with no annual fee. Then there is a second tier of cards, which will usually have a $95 per year fee, which is waived for the first year, and they have more rewards and perks. Then there is a third tier of cards that will have much higher spends (sometimes $6000-$10,000 in 3 to 6 months), but they will have much larger rewards along with about a $500 fee. I recommend staying away from the higher to your cards unless you can play that game and it’s not an issue.

OK, that is our Lemmy primer for everyone interested in credit card points.

Edit: I also strongly recommend you get one of the lower tier cards now, and keep that one with no anual fee from now on. Part of credit history is card longevity; I am a charter cardmember of a card from years ago for that reason.

1. How much are you spending on your cards every month???
2. Why not have more than one card for different things, rather than cancelling cards?
3. You generally want to very rarely cancel a credit card, I recommend finding one with no annual fees and sticking with it. You can always have more cards after all.
4. A spending limit doesn’t really mean anything if you payoff your credit early, you can always request that your CC company release your credit early once you pay it off early.

I never got what it is with Americans and their credit cards. Why does one need several and what's up with those credit limits? If you're buying on credit it by defintion means you can't afford it and thus shouldn't buy it. I do have a credit card as well but the only thing I use the credit side for is online purchases for security reasons. Everything else is charged directly from my bank account.

It could be much worse. I was ready for you to tell us about the massive debt you racked up. At least this is something that will go away over time with no cost or effort on your part.

Iirc, closing an account impacts your credit not because you cancelled your account, but because it impacts your debt/credit ratio.

You have 2 credit cards. Card A has a 10k credit and 2k balance. Card B has 10k credit and 0 balance.

So your ratio is 2k/20k or 10%.

If you cancel card B, your credit line is now 2k/10k, which is 20%. This increases your credit utilization, which impacts your score.

Opening and closing a bunch of cards without any balance shouldn't have a significant impact on your score, maybe a few points.

Hard inquiries can be bad but most credit cards use soft inquiries nowadays anyway

You just tanked your credit score by a lot. There are two aspects about this that matter:

Each one of those approvals required the credit card companies to pull your credit score from the major credit reporting agencies, and a lot of credit inquiries very close together will cause your score to go down. This is not so bad, as those will only weigh on you temporarily.

The worse one, however, is account age. Opening so many lines of credit has lowered your average account age by a ton, as you now have many accounts on your credit history with 0 years, so you are going to see a big drop because a lot of what makes up for a good credit score is how long you've maintained good credit (which means using it and paying it off on time to prove you can actually handle being lent money) and how much credit diversity you have (mortgage, auto loan, credit cards, etc.) .

The good thing is that both of these blunders will go away with time. How long it will take to get you back up to 830, well, I can't quite say.

Like, this isn't as bad as a bankruptcy is for your credit score, don't get me wrong, but you're going to need to start reading the fine print on these very carefully moving forward, because you can't afford to keep signing deals for credit cards and not knowing exactly what the terms are. If you didn't know what the credit limit was up front, you probably weren't paying attention to things like APR either and that makes a big difference. Why did you feel the need to get a new credit card anyway? It sounds like you had no issues building credit before.

The fuck is wrong with you?

You most likely have a number of credit inquiries on your account now. The bad news is that it hurts your credit score. The good news is that they go away over the course of a few years to five years. I'd do a lot of research before getting another card. Get a basic one. I use mine for modest purchases like groceries. Credit cards also benefit from purchase protection, and serious tradeoffs like Rewards, which come from transaction fees (which in turn tend to raise prices on all goods that accept credit cards. There's no such thing as a free lunch).

You shouldn't be maxing your credit anyways, so 5k should be fine. Pay it off every month, the interest rate is insanely high if you fall behind. It's better to get a loan from a bank for massive purchases.

Ps- I wouldn't get a card that has annual charges, unless you are doing like, a shitload of foreign transactions whose transaction fees exceed the cost of the annual CC fee. Usually this doesn't pencil out unless you are Canadian and there's an American Costco a 25 minute drive from your place near the border.

You did more damage by canceling the cards than getting them and keeping them. In the end, had you kept the cards, it would have improved your score (even if you never put any charges on them because having the space counts positively toward your debt-to-credit ratio in FICO).