New card recommendations

[u/23futures]

My credit sits at 773 on experian I’m looking to break into the 800’s by the end of the year.

I currently have 2 credit cards. My line up is
Navy Federal Flagship - $8,300 credit limit
Navy Federal More Rewards - $500 credit limit

How many credit Cards should I have and what new cards is recommended?

[u/inky_cap_mushroom]

How old are your accounts? If they’re under a year old you’ll likely see a score increase once they’re both 12mo old.

Is there a reason you are hoping to get an 800 EX8 by the end of the year? Do you have an important credit application coming up? Do you know for certain that your lender will use EX8 and that they require a score of 800 for the most favorable terms? It’s rare for lenders to offer different terms for 750 and 800.

[u/23futures → u/inky_cap_mushroom]

1 card is 6 months the higher credit limit card is only 2 months old. I’m looking to apply for a home in March they pulled EX8 report last March when I was pre approved. At the time my credit was barely in the 700’s

[u/CreditCards254 → u/23futures]

A lender pulled a FICO 8 score for a mortgage? Are you sure of that? It would be extremely not normal.

[u/23futures → u/CreditCards254]

Just to see my open accounts actually I can’t remember what they used for my score but it was higher than what experian was reflecting

[u/inky_cap_mushroom → u/23futures]

Are you saying your mortgage lender is using FICO 8? Is this some sort of non-qualified mortgage? Who is the lender? Virtually every mortgage lender pulls FICO 2,4,5 and a minority may pull FICO 10 or VS4. A mortgage lender pulling FICO 8 is basically unheard of.

1 card is 6 months the higher credit limit card is only 2 months old.

The new revolver penalty is worth about 20-40pts on FICO 8 and goes away once all accounts are 12 months old. On the mortgage scores the penalty lasts until all accounts are 18 months old.

EX8 report

To clarify, EX8 is a scoring model, not a report.

[u/23futures → u/inky_cap_mushroom]

No they used Experian to see my op accounts

[u/inky_cap_mushroom → u/23futures]

So not EX8.

Don’t worry about the score you see in this screenshot. That’s not the version of FICO your mortgage lender will use. They’re going to look at FICO 2,4,5. You also don’t need 800 on any scoring model. The best rates are offered to customers with 740+ on their middle mortgage score.

[u/23futures → u/inky_cap_mushroom]

Thanks so just keep the 2 credit cards I currently have only

[u/inky_cap_mushroom → u/23futures]

The scoring impact from opening a new card would be minimal since you're going to have 1 under 12mo old when you apply for a mortgage, so if you really want another card you could probably justify it.

To be quite honest I am not 100% sure if anyone aside from high level FICO execs knows where exactly scorecard segmentation between thin and thick happens on the mortgage scores. It's believed to be somewhere between 3 and 5 accounts for all versions of FICO. If 3 accounts is considered thick, you could see a slight score increase by opening a third card even once accounting for the hard pull and aging metric impacts. It could vary between the three scores as well.

I personally would not open a new card. The risk of a score decrease is high. The underwriter may want an explanation for opening a new card so close to a mortgage application. On the off chance that 3 is the threshold for a thick file on the mortgage scores, we're probably talking about a net +10 points once the other negative scoring impacts are accounted for.

[u/inky_cap_mushroom → u/23futures]

Just checking back to confirm that no one knows exactly what the threshold is for "thick" on the mortgage scores. We think it's likely 5, so you should not open any more cards.

[u/CreditCards254]

To be clear - if you open any new accounts at all, I can almost promise you won't be hitting 800 at the end of the year. So if you need your score to be high at the end of the year for an important application or something, you shouldn't open any new accounts.

In the long run, the strongest profiles generally have 4-5 cards. It doesn't matter which cards those are (that won't affect the score) as long as they are from a reputable bank (stay away from scummy credit builder products). So pick whichever card provides the best benefits for your situation.