How do you know that the CC would bring your score down? Are you using your score for anything?
How opening up a new credit card brings your score DOWN -
1) You pick up an inquiry. This is relative to how many inquiries you currently have on that specific report(s) that they pull. If you already have 8 or 10, another one isn't gonna hurt as bad as if you go from 1 to 2 inq, so it's relative. Anywhere from 1 - 10pts loss. This, combined with your "credit mix" (account type distribution) constitutes 10% of your FICO score.
2) Your AAoA (Average Age of Accounts) goes down. This constitutes 15% of your FICO score. So if you had 5 accounts that average 6 yrs of total age, you would now go down 16.66% in average age, bringing you down to 5yrs AAoA from 6 in the example.
3) New accounts generally will bring your score down several points (20+) until they age about 6-12mo, just because they are new accounts.
How to get around the negatives above
If you have American Express accounts (AMEX), and you apply for another one of their cards to take advantage of some offer (there's some Blue Cash offers out there sometimes for $100 - $200 cash back bonus), your new account will show that it was opened the date of your OLDEST Amex account ever was opened. This is called "backdating", and to my knowledge is only done by Amex. So, you lose nothing on AAoA, and may actually gain (you can do your own math on the gain part). Also, they only soft-inquiry you (if you are existing customer) unless they approve you, then they will hard-inquiry you also. Therefore, there's almost no harm in applying for AMEX if you are already a customer, even if they deny you. It will also, therefore, not show as a new account. You have now mitigated all 3 negatives above.
How opening up a new credit card brings your score UP-
1) Your utilization will improve (only matters if you carry balances). So, if you had existing credit limits of $20k, were carrying $10k of it in balances, you have 50% utilization of your available credit. If your new card comes with a $5k limit, you've just dropped your utilization down to 40%. You will pick up points for that, as utilization constitutes 30% of your FICO score calculation.
2) If you have limited credit, it will age with the rest of your credit profile. Kind of the inverse of scenario 2 above. If your AAoA is only a few months, you'll do it more good than harm by adding another card, as length of history for accounts rounds down to 0 unless your account is > 1yr.
Not my intention to come off as a dick, but I'm pretty experienced with this stuff based on my line of work so thought I would clear up some ambiguities in this thread.
And for those holier-than-thou "I'm so rich I never carry balances" , consider that part of the credit card game is getting the 0% BT offers and putting yourself in a position to generate money that was borrowed at 0% (think - funds / stocks). I've done that several times, and came out ahead, far more than a few points on my credit score is worth. Now days, more often than not your app will be manually reviewed by an analyst (unlike 4-5 years ago), and an analyst can extrapolate rates based on the minimum payment for a given account provided on your credit report. We know 0% vs 24.95%, and will generally overlook utilization that is based on 0% accounts if that's your only negative factor.
My take on this deal? You could do way better than this if you take a look at some of the AMEX bonuses that come up (cash / miles / member points) and since it negates most of the downside to a new account. All of those equal cash for the savvy consumer. However, if you don't have any Citi in your accounts portfolio, it's not a bad offer, although personally I'd go for the AAdvantage bonuses that come up every so often (50k miles on AA) = 2 domestic plane tickets = at least $500 value.
Please give me direct link to apply for Citibank Diamond Preferred card - $200 cash back after $500 spending
Did you read the complete post? There are three links. The first two are working. The last one is DEAD. Not sure how you can miss the first two links. It's very difficult to miss, IMO.
Are you dead set on getting the Diamond Preferred card? if you're then I guess you will be stuck with only one. If not, then the first two should work Citi Dividend World MC and Dividend Platinum Select.
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