Ok, so I am making a rather large purchase for a high-end musical instrument that is being hand-built. The total cost will be about $13.5k. I've paid off $2,560 of it thus far, leaving me with about $10,940 left needing to be paid. The person building this instrument is a one-man crew who has me on a 2-year+ waiting list due to how long it takes him to get to each customer. My time is getting closer to being up (signed up May 2012), but my instrument has still not been built yet. I might receive the instrument in June. I might receive it in December or even later. I am not sure yet because I have not spoken with the guy in 9 months (it's not good to email the guy every day for two years after all
). I just emailed him last night, so I will get a better idea of when the instrument will be done. He told me from the beginning that the 2-year wait was an estimate since it's so difficult to give an exact estimate as to how long it will take to get to my build since he is doing all of the work himself. The fact that he hasn't emailed me yet tells me that I have at bare minimum 2 months since that's how long it takes him at the bare minimum to make the instrument.
Meanwhile, I am attempting to prepare to pay for this instrument. There's a good chance I won't be able to pay it off without a running balance of some amount by the time he will be finishing it. I will, therefore, have to find the best way to go about paying off this instrument.
I have 6 or 7 years of credit history due to some student loans that were taken out in the summer of 2007 for college.
Here are my credit/charge cards:
Amazon Store card - $400 (Dec 30th, 2011)
Kohl's - $300 (Dec 31st, 2011)
American Eagle - $300 (Mar 27th, 2013)
PNC CashBuilder - $1,000 (Feb 9th, 2014)
PayPal Extras MC - $3,000 (Feb 14th, 2014)
BoA Cash Rewards - $5,000 (Feb 18th, 2014)
Chase Freedom - $1,200 (Feb 18th, 2014)
2nd Amazon Store card (didn't know the first one was still open) - $2,200 (Feb 23rd, 2014)
Sallie Mae MC - $1,000 (Feb 25th, 2014)
Discover It - $3,800 (Apr 2014)
Fidelity Investment Rewards Amex - $5,000 (Apr 2014)
= $23,200 in total credit (how I got approved for 8 lines of credit in 60 days despite only owning store cards before and having $31,500 in untouched, deferred school loans, I will never know :cool
Average account age is 2 years, 4 months due to my school loans (thank God for those)
My FICO according to the recent report I got from Discover upon being accepted last week was 744. No major delinquencies ever. I am 24 years-old.
My plan is the following:
1. Apply for one or more credit cards that offer 0% APR for 12-18 months. The higher the credit limit, the better, so I might go after cards whose credit lenders are known to be more generous with their credit limits. BoA seems to really like me a lot (both of my highest limit cards, $5,000, are from them), so I might go after them.
2. Ask for credit limit increases on all of my cards so as to increase my overall credit limit so that, when I do put this large purchase on my card(s), my overall utilization % will be less and, therefore, hurt my credit score less. I heard that getting your overall utilization under 30% is the magic number. I've already done the math, and I will need at least $36.5k for my total credit limit between all of my cards if I want to stay under 30%, and really I will probably want at least ~$40k for a total credit limit between all of my cards so that I can make other purchases and still stay below 30%.
3. Put the purchase on one or more credit cards that have 0% APR for at least a year and pay off the purchase in full before the 0% APR ends.
So what I am asking from you guys is:
1. Judging me from purchasing a $13.5k musical instrument aside, how does my plan look in terms of feasibly carrying it out without murdering my credit score or taking on any interest (so long as I pay the purchase off before the 0% APR ends)? What would you change?
2. Which cards should I go after based on the prerequisites I gave above? Yes, I know that there's a page that shows all 0% APR cards, but some of you have specific experience with these banks that will give me insight as to which ones to go for. City Simplicity looks good with its 18 months 0% APR.
3. Should I spread the multiple-thousand charge to a few cards in order for it to have the least impact on my credit score? Or is using one card fine if I can manage getting it all on one card even if it is near maxed out? The reason why I ask this is because I heard that it's not good to have ANY card above 30% utilization even if your overall utilization is below 30%. Which is it? Does it matter if your utilization of your credit limit on ANY card is over 30%? Or can I have one card over 30% as long as my overall utilization is under 30%? If it's the latter where only my overall utilization of all my cards matters, then this is why I will be wanting to get as high of a total credit limit as possible by asking for credit limit increases on all of my cards.
4. How long from the day of opening any of my credit accounts should I wait to apply for credit limit increases? 60 days? 90 days? 6 months? How should I go about it? Online? Phone? I think by phone would be best because I feel like talking to a real person would give me a higher chance of being approved for higher limits. Any good "reasons" (true or not) that I should throw at them to help convince them to increase my limits?
5. What else can I do to make things flow as smoothly as possible?
One more thing. The builder of my instrument told me I can delay the process of building the instrument by about 6 months if I wish to do so, so that might give me more time if I need it to either pay it off in full before he completes it or so that I can prepare my credit situation in order to take on the purchase without interest or killing my credit score.
Oh, and I might also be getting a promotion within the next 2-4 months that will over double my current income if it happens. That would potentially make it easy to get higher credit limits.
Thanks in advance for any help anyone offers me. I know this is a complex situation.
Whats's in the wallet: Discover It - $3,800 (5% rotating, ShopDiscover), Sallie Mae Rewards MC - $1,000 (5% on gas, groceries, and Amazon), Chase Freedom Visa - $1,200 (5% rotating + 10% extra w/ Chase Total Checking), PayPal Extras MC (1.66% on PayPal, 2.5% on Restaurants- $3,000, Bank of America Cash Rewards Visa Signature - $5,000 (Signature benefits), PNC CashBuilder Visa - $1,000 (Don't use), Fidelity Investment Rewards Amex - $5,000 (2% on everything)
. . . and some store credit/charge cards.
-US Bank Cash+ (for the 5% categories)
-1-2 0% APR cards for some big purchases I'll be making within the year