UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev Thread | Prev | Next | Next Thread
Author: aj485 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308722  
Subject: Re: Transferring credit to lower rate Date: 10/8/2011 7:34 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 6
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.

AJ
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev Thread | Prev | Next | Next Thread

Announcements

TMF Credit Center
The Motley Fool Credit Center arms you with real tools and simple messages, that will help you in every credit situation.
Pencils of Promise - Back to School Drive
"Pencils of Promise works with communities across the globe to build schools and create programs that provide education opportunities for children."
Managing Your Wealth
Our own TMFHockeypop from Rule Your Retirement fame on the TV show Managing Your Wealth.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Value Hounds

Mobileye's Growth too Hot?
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement