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Babies on the Brain
aerotigergirl
member
WWBOTBD: Credit Card Questions
aerotigergirl
member
I have 3 credit cards and a couple of questions for all of you.
CC #1--> I've had this one for 10+ years. It has a zero balance right now, but when I was in college I did use it and I was late on it sometimes. Since grad school, I've paid it off several times, and I've never been late on a payment. I haven't used it for purchases in a long time, but I've used it for balance transfers because I've always been able to get 0% APR on balance transfers.
CC #2--> I got this one a few years ago for the sole purpose of taking advantage of the 0% on balance transfers (12 months). I rolled some of my higher interest card (there used to be a few others but I dug myself out of a huge amount of CC debt) balances onto this card and paid them off. Yay me! I haven't used this card since I paid it off, because they refused to give me 0% on balance transfers after the 12 months ran out. They'll offer me 4.99% now.
CC #3--> This is the only card that I actually make purchases on. It has the best interest rate for purchases. I recently bought an entire kitchen worth of appliances on this card, and would like to pay off half of it and then roll the other half to a 0% interest card. I'm not late on this card, but it does have a balance now (obviously).
So, my question:
If CC#1 and CC#2 refuse to give me 0% on balance transfers, regardless of the fact that I haven't been late on a payment in several years and I have paid them off several times, would it be in my best interest t:
A) open a NEW CC with a 12 month introductory 0% APR on balance transfers? (And obviously then pay it off before the 12 months runs out...)
Would it help or hurt my credit score if I did that along with closing the other two accounts (CC#1 and CC#2)? (since I'm not using them anymore and they both have zero balance already)
I have enough savings now to pay for the appliances outright, but I'd rather not leave my savings account completely famished...
Sorry that turned into such a long story. Cookies for you if you made it this far!
1/2015 November Siggy Challenge - Thanksgiving Fails
This discussion has been closed.
Re: WWBOTBD: Credit Card Questions
Honest opinion: stop buying shiit if you don't have the cash to buy it outright and have to keep opening credit cards to get 0% interest.
All those open credit cards with no balance are actually a bad thing on your credit.
Good point, but I do have the cash to buy it. We have plenty of cash to buy these appliances, but I don't want to leave myself with a depleted savings account in the case that there is an emergency and we need access to liquid funds.
And the reason I'm asking is because I've heard mixed reviews. Some articles I've read indicate that leaving "positive" credit history open is actually good for your credit.
And, as for buying random shiit, we don't. We're buying appliances because we bought a house and we're in the process of renovating the kitchen.
1. Keep at least your OLDEST card open, and use it occaisionally. Do NOT lose that card. It helps your average age and credit score quite a bit. Make sure to use it or they will prob close it for you.
2. You're really better off (if credit score is your priority) NOT rolling the balance to a new card. Young cards are bad for credit scores (see #1), as is a great deal of unused credit - even with a great debt to income, it looks bad if you could go jack up THOUSANDS of dollars in debt in a heartbeat.
My suggestion would be to move it to the 4.99% (that's a good rate), and just make it a priority to pay off.
Honestly, I stopped reading this post about halfway through.
IMO, one credit card for emergencies (actual emergencies, not new shoes) is plenty. Keep the one with the lowest interest rate and get rid of the rest.
Mmmm...cake!
This was bad advice, credit score wise.
I will amend my response. Do not buy anything unless you have the cash to pay for it without draining your savings.
If the cash you have is technically your emergency fund, then, no, you don't have the money. Closing cards reflects negatively on your credit score.
Having that many credit cards open isn't good for your credit. We have one Amex we use and pay it off in full every month. And then each of us has a Visa for emergencies/not all places accept Amex. Those cards are payed off in full also.
I don't get the point in having 10 credit cards so you can roll your balance over when you don't feel like paying it off. If you can't afford it and it's not a completely neccessary item (like an ENITRE kitchen full of appliances) don't buy it. Problem solved.
PSA: Target has toasters for like $5, works great and doesn't warrent a credit card payment.
OK, that's kindof what I was wondering, I guess. I had read it's a good idea to keep an old card open by using it (and paying it off) every now and then because it keeps your line of credit open and thus your good history continues to show up on your credit score.
I am reluctant to open a new card for credit score reasons, but also just because I don't WANT another card. Credit score isn't really an issue, I guess... we just bought a house and my credit score was great.
Also, I don't want to give anyone the wrong idea... We do have plenty of money to purchase these things. But I get rewards on my purchasing CC, so rather than simply paying for the appliances outright, we purchased them with my CC. And, like I said, I'd like to leave plenty of money in my savings account to cover an emergency (should one arise). These appliances will be paid off in a few months no matter which way we go.
I promise you won't see me again in a few months complaining about how we can't make our bills.
1. Then you don't have the cash to buy it outright. Emergency funds should never be touched unless it is a true emergency.
2. Your history with the credit card company is not in your credit report. The only thing that is in your credit report is your current standing with the company, and your actual history determines your score. It will not hurt you one bit to close all but the oldest card and keep it in a safe place--using it occasionally to keep it open.
3. I never said you were buying random shiit. If you are remodeling your kitchen you should have the funds available (without using credit cards or emergency funds) to complete the remodel.
Ok, guys, we all know it's bad to use credit irresponsibly. It sounds like she's been doing a pretty damn good job with it and there's no reason to insist that you have to use cash to buy new appliances. If it's done right, it's okay to use credit.
The only big mistake you're making, from what I can tell, is opening new cards to roll balances. Have one or two GOOD cards open, and use those. Be willing to pay the interest if that's what you're doing - the 4.99 is probably less or close to your mortgage, which is what you might normally use for home improvements.
Fair enough. I agree with your philosophy. But we didn't need a toaster. We bought a house with NO working appliances in the kitchen. This was fine with us because we knew we'd renovate the house anyway. But I mean, no refrigerator, no stove, etc. Not things like blenders and toasters and whatnot.
Our oven didn't work in the house we just bought. We had to buy a new one when we moved in, so this was put on our credit card becuase we could classify it as an emergency expense. It definately sounds like you have the $$ to pay for these (or at least will a few months from now), but it wouldn't hurt considering closing a few of your credit cards.
Mmmm...cake!
This. This is really the only question that I have. Is it better to open a new card and close 2 old ones, or worse? I think, with the answers I've gotten here, and the things that I've read online, I have an answer to that question now.
I promise that I am not using credit irresponsibly. My history (and my excellent credit score) shows that. There was a time when I had to rely on credit cards and I created a big debt for myself, which I have since paid off entirely. So, I'm smart enough to know better than to go around buying a lot of random stuff that I don't need and can't afford. But thank you for your concern.
I agree to a point.
I was always responsible with my credit card use--not too much charged and paying most of it off at the end of the month. But then something happened. And I couldn't be "responsible" anymore.
As convenient as credit cards are, they are also a complete disaster waiting to happen. In 3 months you can go from perfect credit and no balance, to maxed out and shitty credt with the debtors calling every hour.
It's not worth it to me, no matter what incentives are offered.
Oh, I definitely agree with this. Like I said, I got into trouble a while ago with credit (back when I was a young college student with no alternatives).
I feel like I could defend myself (and the decisions my husband and I made regarding these appliances) a little better, but it would require even more details of our finances, and it's just not worth it, I guess. Thank you all for your advice!