Talk me out of an Amex

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Vattené
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Talk me out of an Amex

Postby Vattené » Sat Jul 26, 2014 1:37 pm

I want to apply for an Amex EveryDay card (I already have a good cash back card and like that you get full-blown MR points with no fee), but I feel like I don't really have a good reason. Maybe too much time on this forum has left me with app-shame :ppp

The biggest reason for Amex is, honestly, the backdating. Personally I feel this is a HUGE perk, but is it too silly a reason to get one now - just for the benefit I might get if I apply for another Amex at some undetermined point in the future? Purchasing a house will be a goal in the future, but I am honestly not sure how far down that will be (no less than a year, but quite possibly longer). So, IF I apply for a card the sooner the better - it would just be that much sooner the inquiry would fall off and that much longer of a history.

I love my current Discover card, but the biggest reason I am considering another is for better travel rewards. I posted a while ago soliciting advice about getting a card specifically geared towards travel, but I think it was the right choice not to as I am not a frequent traveler nor have plans to become one. My wife and I are saving for a belated honeymoon in 2016. I would like to use rewards to offset that cost. Discover's cash back program could do it, but they don't have the travel partners that a Chase Ultimate Rewards or Amex Membership Rewards program does, which would make a card's benefits go that much further. I am not sure how much further though, as non-members don't have access to that much information.

My biggest concern is that I have recently financed a car, and the adverse impact the high balance on that loan would have on my chances for approval. My FICO score has stayed the same, however, despite the fact that the amount I owe (the second-largest component) has shot up. Do you guys think I am justified in worrying about my approval odds, or will creditors likely see a high balance of a recent loan in light of an otherwise creditworthy profile? Is there some ratio I should get to before I even try?
-Vattené
FICO-8:
EX - 809 (11/16) | TU - 803 (11/16)
Primary Cards:
American Express EveryDay - $20,000 (10/14)
Discover it - $23,000 (2/14)
AU on Barclay Sallie Mae - $10,000 (8/15)
plus several store accounts of varying usefulness now


MemberSince99
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Postby MemberSince99 » Sat Jul 26, 2014 4:05 pm

I think you are way over-thinking and analyzing this. Installment debt is different than revolving debt. Not to say it means nothing to every creditor just it's different.


If you get EDP or ED you can use those MR points joined with say Platinum to transfer to Amex travel partners. Of course, getting Platinum for one trip might not be something you want to do, but you get the idea. You can build points now that transfer later.


I am not going to try to talk you out of it. Instead if you want it go for it. Backdating could be valuable down the road, so if you want Amex the sooner you get one the better. And don't sweat a mortgage a year or more down the road - I got a new card and a new car while I was house hunting and my LO assures me it's not a problem to get to the close. I know it's always YMMV but a year or more away, don't sweat it at all.

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Postby Vattené » Sat Jul 26, 2014 7:59 pm

MemberSince99 wrote:I think you are way over-thinking and analyzing this. Installment debt is different than revolving debt. Not to say it means nothing to every creditor just it's different.


I probably am overthinking it...hopefully at least. I guess I am just worried I won't get approved, and this is the first loan I have ever taken out. The high outstanding balance is showing up on the sections of the free score on Discover and Walmart that explains the factors most hurting your score. I get that something has to be the worst factor and this normal for anyone as soon as they take out a loan.

I also get the math that could justify paying an annual fee for a card, but for some reason I have a real physiological aversion to paying a fee. I just don't want to feel like I HAVE to put a lot of spending on any card. I also don't want that to impact my spending.


I am really leaning towards going for the ED. I see no benefit in a Plainum card for me, personally. Of course you actually have a use for it, so that is a different story. I simply don't travel, so it wouldn't do anything for me. I traveled some for a previous job and racked up around 60,000 Hilton HHonors points, so I considered the Amex (nonAF) Hilton card, but their points just aren't that valuable.

Thanks for the words of encouragement. It certainly puts me more at ease about applying
-Vattené
FICO-8:
EX - 809 (11/16) | TU - 803 (11/16)
Primary Cards:
American Express EveryDay - $20,000 (10/14)
Discover it - $23,000 (2/14)
AU on Barclay Sallie Mae - $10,000 (8/15)
plus several store accounts of varying usefulness now

yfan
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Postby yfan » Sat Jul 26, 2014 9:48 pm

Your FICO certainly seems good enough for you to qualify for the Amex Everyday. What I am seeing though is that you have steadily opened up new cards in the past couple of years. Amex may not like that very much. On the other hand, most of your hard pulls seem to be more than a year old - with only the Discover and the car loan being new ones. Depending on the length of your credit history, another HP may or may not hurt much, and if you get approved, it will help lower your DTC ratio.

MemberSince99
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Postby MemberSince99 » Sat Jul 26, 2014 11:13 pm

yfan wrote:Your FICO certainly seems good enough for you to qualify for the Amex Everyday. What I am seeing though is that you have steadily opened up new cards in the past couple of years. Amex may not like that very much. On the other hand, most of your hard pulls seem to be more than a year old - with only the Discover and the car loan being new ones. Depending on the length of your credit history, another HP may or may not hurt much, and if you get approved, it will help lower your DTC ratio.



Maybe, but it's always YMMV. I only have a few cards in my signature, but if you count all of them I've closed over the last couple of years, I'd have more of them than a lot of the people over on FICO. Doesn't seem to bother Amex, but again, it really is always YMMV and others have reported they didn't like that so you just never know.


If you want it, I'd take the shot.

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Vattené
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Postby Vattené » Sun Jul 27, 2014 10:15 pm

yfan wrote:Your FICO certainly seems good enough for you to qualify for the Amex Everyday. What I am seeing though is that you have steadily opened up new cards in the past couple of years. Amex may not like that very much. On the other hand, most of your hard pulls seem to be more than a year old - with only the Discover and the car loan being new ones. Depending on the length of your credit history, another HP may or may not hurt much, and if you get approved, it will help lower your DTC ratio.


Yes, I wish I had seen the benefits of using major credit cards much earlier. My early credit history would be different, but at least it will help me down the road on my AAoA. I know for sure that my only hard inquiries within the last year were for the Discover card and car loan.

Can someone tell me how beneficial MR points are when traveling? Do you get a discount on flights or hotel rates? I see they offer gift cards at face value (and Discover has a great selection at significant discounts), but you have to be a member to see what MR points will get you for travel. I am interested in how this works.
-Vattené
FICO-8:
EX - 809 (11/16) | TU - 803 (11/16)
Primary Cards:
American Express EveryDay - $20,000 (10/14)
Discover it - $23,000 (2/14)
AU on Barclay Sallie Mae - $10,000 (8/15)
plus several store accounts of varying usefulness now

MemberSince99
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Location: WI

Postby MemberSince99 » Mon Jul 28, 2014 6:24 am

MR points are best used by transferring them to Amex partners where you can potentially get the best return on them, like UR points with Chase. That should give you your best rate of return. They don't get you a discount per se so far as I know, though depending on the card, you can be upgraded at your hotel, get access to airport lounges, etc, perks like that. But you will get your best rate of return this way. Using a combination of say a PRG or Platinum for the perks and an EDP to get the points on every day spending is what I'm doing now.



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