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Personal Finances / Credit Cards and Consumer Debt
|Subject: Re: Transferring credit to lower rate||Date: 10/8/2011 7:34 PM|
|Author: aj485||Number: 303315 of 311357|
If I'm understanding your question Bock you are asking if the it will be harder to get credit in the future if you transfer from a 17%+ card to a 5.9% card with a $10,000 initial credit limit. Assuming that is the question here is my answer.
Yes, having more available credit will make lenders less likely to give you credit in the future. How much less I can't say but your total amount of available credit is a factor.
Well, the post you replied to is 14 years old, so Bock probably isn't looking for an answer anymore.
That said, I would tend to disagree with your premise that having more available credit will make lenders less likely to give you credit in the future.
The fact that one has more credit available, assuming they don't actually use it (as Bock was planning on doing - he was just going to transfer his balance, and pay it down), decreases one's credit utilization. Since credit utilization generally accounts for about 35% of the credit score, and utilization less than 10% generally results in the best scores, by adding additional credit, one can significantly improve their score.
There may be a slightly offsetting drop in one's credit score due to the inquiry that the lender made, but since new credit history only accounts for 10% of one's credit score, the decrease is likely to be lower than the increased in the credit score from the decreased utilization.
The higher the credit score, the more likely one is to be granted credit in the future, all other factors (debt:income ratio, etc.) being equal.
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