Have a screwed my credit up?

July 10, 2008 8:06 PM

I stupidly (and drunkenly) applied for a credit card at one of those booths at an outdoor event. Have I screwed myself?

Here's the deal. I'm buying a house. I've already made the offer, it's been accepted, and my mortgage broker says the financing is in place. (my credit rating was very good.)
The closing date is the end of August.
My real estate guy told me not to do anything to affect my credit (like get more of it to buy furniture and stuff) until AFTER the closing date, because the bank will re-check my credit a week or so before the closing date, and extra activity could scare them.
(I don't really understand how this works, so forgive me if I'm getting this wrong)

Anyways. Tonight, I signed up for a credit card just so I could get the free gift. (a blanket. I was cold.)
(...and a little drunk. Hence the momentary lapse of reason.)

So, I guess I have two questions:
1) Will this stupid move really potentially affect my house purchase?
2) Can I somehow cancel an application before the card is sent to me - or is the damage already done?

posted by Tbola to Work & Money (6 answers total)

Actually, your debt-to-available-credit ratio is a big part of your credit score, and if you have a lot of available credit and little or no debt, it can actually increase your score. You may have had a very small hit to your score when the credit card company ran the credit check on you to approve you, but nothing big enough that it should affect your house buying escapades. However, I would strongly recommend against using that card until all of the house stuff gets squared away. Canceling the card could actually hurt you at this point. Just stick it in a drawer.
posted by joshrholloway at 9:44 PM on July 10, 2008

I wouldn't worry about it. One credit card will barely make a difference, and it won't even show up for several weeks (in my experience after the first statement prints).

You will get a "hard" inquiry, but these are relatively minor scratches to your credit score.

As a data point, I have opened credit cards and have my score go up (although I am relatively young, and it was a high limit card relative to other cards I have).
posted by djpyk at 9:59 PM on July 10, 2008

Best answer: Yes, a new account will look bad to your mortgage broker. It's not about score with mortgages, and they will check again before you close.

Definitely call asap to see if you can un-apply. An inquiry without a new tradeline won't look so bad. I don't think you'll be able to, but it never hurts to ask. Holding onto the card without calling the activation number will not help, they will still report the account.

Make a post on Creditboards asking for advice.

And talk to your mortgage broker before he finds it on your report. Explain that you had a lapse and applied for a card you don't need.

Good luck!
posted by mad bomber what bombs at midnight at 10:29 PM on July 10, 2008

Just because you signed up doesn't mean you have to accept the card. They'll ding your credit to determine your limit, but I can't fathom that it should "scare" a bank. When/if the card comes, just cancel it. I wouldn't worry.
posted by TomMelee at 5:19 AM on July 11, 2008

I'm not that knowledgeable about this stuff, but tou might want to ask in the CreditBoards Forums.
posted by sharkfu at 5:48 AM on July 11, 2008

Response by poster: Thanks for all the advice! My mortgage broker seems to think I'm going to be just fine.

(And the credit card folks say I can cancel once my name shows up in their system - so I'll get an inquiry, but at least I won't be getting the card.)

posted by Tbola at 12:25 PM on July 11, 2008