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This is post one of four on my most recent round of credit card applications and will focus on the basics of credit and how to perform a personal check to make sure everything healthy before a round of applications. Post 2 will be how to conduct a personal card inventory and decide which cards to keep and those to cancel. Post 3 is evaluating the top current card offers and which offers to go after and which to hold off on. Post 4 is the results of my applications and my experience with reconsideration lines.

I haven’t applied for any new credit cards in about 6 months because I recently refinanced my mortgage and wanted to finalize that before accruing any more hard credit inquiries. Luckily both my mortgage closed and most of the top limited-time offers (like the Amex Platinum 100,000 and British Airways 100,000) were offers I’d already gotten in the past so it wasn’t too frustrating to be on the sidelines. However, I’m now ready to get back in the game and beef up my balances with some of the top bonuses out there. When starting a round of applications, though, I always like to do a three-part checklist before I get the joy of being able to click submit (and hopefully get the rush of an approved application and new bonus on the way).

1) Check my credit health
2) Take an inventory of my current cards to decide which ones stay and which ones go
3) Which top offers make the most sense to go for now versus waiting for later

It’s critical to build and maintain a strong credit profile if you want a long-term credit card earning strategy. This post will focus on the basics of credit and how to check it, so if you’re an expert you can skip this. However, if you are new to the credit card/points game, it is important that you understand the fundamentals of consumer and business credit and that you nurture and keep your credit report and score healthy.

What Is A FICO score?

FICO stands for the Fair Isaac Company (not a government department) that aggregates credit data and sells that information to individuals and companies. Though there are a number of other credit-scoring companies such as VantageScore, the most widely used is FICO.

Your FICO score is a number between 300-850 that the Fair Isaac Company issues based on your credit, and which is a good way to estimate what your credit score is and whether you’ll be successful when applying for credit cards.

“Good” credit is generally over 700, and credit card companies generally don’t differentiate much among scores between 720-850.

Don’t be scared by the numbers though. Even if your score is in the mid-high 600’s, you might still qualify for good loans and credit cards (depending on a number of factors, which I’ll elaborate below). The threshold for approval with each lender is kept secret and so you’ll generally only find out when you apply, but you can research them on sites like

FICO score breakdown from
FICO score breakdown from


What Determines Your FICO Score?

There are five main factors that determine your credit score. These are:

1. Payment history: 35%. This is the single biggest factor – over one third of your score depends on it, and it means the simple act of paying off your bills on time is crucial to building and maintaining a good credit score. It’s not just your credit card bills either. Payment history includes account information on retail accounts, installment loans, auto loans, finance company accounts and mortgages, as well as the severity of delinquency on late payments, the amount due on late payments, and the number of late payments you’ve made.

2. Amounts owed: 30%. Another whopper. The record of the balances you carry counts almost as much as your payment history. The higher your amounts owed as compared to your total amount of credit, the lower your score. This is factored on the number of accounts with balances, the proportion of your credit lines being used (the amount of credit you’re using compared to your overall line of credit) and how much of each of your installment loans (like auto or mortgage) you still owe.

3. Length of credit history: 15%. While not quite as large, this still rings up as a substantial chunk of your total credit score. The longer you’ve had credit, the higher your score. That’s why it’s important to start building up your credit early in life. It is based on the time since you opened your accounts, and the time since your last activity on each account.

4. New credit: 10%. Any new lines of credit you open, whether it’s a credit card or a mortgage, as well as new credit inquiries such as when you apply for a credit card, count towards your credit score. This is why if you’ve applied for major loans or done a churn recently, your score might be lower than usual.

5. Types of credit used: 10%. This factor considers the kinds of accounts—credit cards, retail, installment loans, mortgages, etc.—that you have.

No one piece of information determines your credit score, but all five together paint a more comprehensive picture of you as a consumer. The good news is that you don’t have to have a perfect record in all these areas, but you do have to take all of them into consideration when building your credit.

Finding Out Your Credit Score

It is imperative that you know your current credit score, or at least have a close approximation. Luckily, everyone in the US is entitled to a free credit report each year from each of the three major credit reporting agencies – TransUnion, Experian and Equifax – at However, if you want your actual FICO score, you’ll have to pay $19.95 through directly.

You can also use free services like who will give you their own risk analysis and overall score, but it will not be the actual score the credit card companies use to judge your creditworthiness.

Even if you’re not applying for new lines of credit, it’s still a good idea to keep an eye on your credit report so you’re aware of any changes to it, and you can make sure that all three agencies are coming up with a similar number. If you find they are off, you can also dispute and make corrections to inaccurate information. Many services charge monthly fees (usually about $20) for unlimited access to your report, but I personally don’t feel the need to check my score constantly. However,  many people like to keep on top of all inquiries so any potential fraud issues can be handled before it’s too late.

When your report comes back, look over it carefully and make sure there are no errors. If there are, you can dispute online (easiest) or mail/call the credit rating agencies and have them corrected, especially if they still register a debt that you have paid off. You can see the FTC rules here and check out this site for other practical tips on how to submit a dispute.

Beyond potentially wreaking havoc on your George Costanza wallet, applying for multiple cards will have an impact on your credit – just how much depends on your overall credit health.

The Impact of Applying for Multiple Cards

Of course, the next question is: How does applying for multiple credit cards at one time affect your overall credit score? Although each credit inquiry temporarily causes your credit score to drop by about 2-5 points (out of 850, remember), your score doesn’t take too much of a hit usually. However, when you apply for multiple cards at the same time, things get a little trickier.

Generally, banks treat multiple non-credit card inquiries, like auto loans and mortgages, within a short period of time (around 15 days) as a single credit inquiry. Hard inquiries when it comes to applying for credit cards are a different animal. In its own words, FICO says “opening several credit accounts in a short period of time represents greater credit risk.” That’s because you’re applying for multiple lines of new credit rather than submitting several inquiries for a single new line, such as a mortgage.

So how much will credit inquiries affect your score? In addition to the 2-5 point temporary ding, some banks are stricter than others when it comes to the amount of recent inquiries they are comfortable with seeing on your credit report and still approving you. People with strong scores will still get denied for credit cards depending on the current risk environment and how understanding that credit card company is with your situation. US Bank and Capital One are generally much stricter than American Express and Chase, but luckily Amex and Chase have most of the best travel reward credit cards and offers. But in the big picture new credit only counts 10% toward determining your overall FICO score, so as long as you are solid in the other areas like payment history and amounts owed, you should be fine to apply for new cards.

There are a lot of people in the miles/points game who swear by applications rounds every 91 days since the hope is that hard inquiries will drop on 30/60/90 type intervals so if you space beyond 90 days you’ll hopefully always be applying after a bunch of inquiries drop from prior churns. This has worked for many people, but I personally space my applications a little bit further apart.  I’ll apply in quicker sequences, though, if there is an amazing deal that won’t be around for the next scheduled round of applications.

My personal experience is that if you have a solid income and track record of paying your balances off in full, you can get approved for most credit cards by simply working with the credit card company through the reconsideration line, which sometimes means closing older accounts or shifting around lines of credit. Credit card companies are well aware that consumers are strongly motivated by miles and points (thus why they buy billions of dollars worth from the travel industry) and it is no secret that you can get multiple bonuses- sometimes over and over again. Being financially responsible and also being a good customer is going to go further than simply timing your applications. For example, I do all of my personal and business checking with Chase, as well as my auto loan. I know when Chase looks at me as a customer they see more than just someone opening and closing credit cards every couple months.

When Do Credit Cards Report to the Credit Bureaus?

This is a major question when it comes time for applications because your balances are often reported to credit reporting agencies before you even get a chance to pay your bill off. So even if your statement closes and you pay your bill before the due date, it is very likely that the balance was already reported and your score may dive depending on how high your balance was in relation to the amount of available credit you have.  I’ve seen my credit jump approximately 40+ points in a single month just by paying my balances well in advance and having near $0 balances reported. I’m always extra careful in the month leading into a round of applications and one tip is to use any available business credit cards so that even if you have a balance, it will be reported on your business credit reports, which are separate from your personal lines.

There’s no perfect science to boosting your score, but being aware of all of these different factors and living within your means and paying your bills off on time (or early) are easy ways to keep your score high and your application approval rate even higher!

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Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.