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Question By
dpkiss

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5 People Helped
Good idea? Target & Walmart CC, but keeping limit low.
I know applying for Credit Cards will hurt my score a little. I just opened up a Target REDcard and a Walmart Card and both got approved for $500 each. I'm working on building my credit. I had a Capital One's CC for $300 and I easily utilized it up to 80-100%, but always made my payments on time, yet still had difficulty keeping the utilization low.

The question is, will it help my score now that I opened up these 2 extra Credit Cards, if I kept the utilization low? Or will it hurt me more?

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Credit cards and utilization

Helpful to 2 out of 3 people

Having the additional cards will help (though I discourage using department store cards vs. sticking with the Major Visa / Mastercard type cards as some fail to report limits or even fail to report to all 3 bureaus.)

Ideally you want to maintain between 3-5 revolving accounts (credit cards) and have at least 1 installment loan (Car, home, etc.).

Additionally, you have correctly identified that utilization is a problem.  Utilization has a MASSIVE 30% hit on your credit.  You will want to be SUPER SUPER diligent about avoiding maxing out your limits.  Keep the limit under 30% and ideally at 7%.  People in America with the highest scores typically have balances of 7% or less of their limits.

Let me know if I can assist any further.

Thanks,

Joe

Reply by
dpkiss

5 Contributions
5 People Helped

Thank you so much! Your answers has helped me understand.

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