Should I Apply for New Credit Card Now With the New Credit Score System?

The new credit scoring system could help improve your score when applying for a credit card.

Benefits of FICO 08

The new credit scoring system, FICO 08, is said to benefit the average consumer's credit score. According to MarketWatch, minor delinquencies and collection accounts with an original balance of $100 or less will have no impact on scores, making it easier to apply for and get credit.

Current Financial Situation

A credit card applicant's current financial situation should be considered first before applying for a line of credit, even with the new credit scoring system. Mortgage News Daily says the new system utilizes the same factors as the old one, including the ratio of debt to available credit.

Bottom Line

The new credit scoring system works in favor of consumers by eliminating the impact of low-balance collection accounts and the occasional late payment. However, financial responsibility outweighs these benefits. Applying for a credit card should be considered only if the user can afford to maintain a positive credit score by making timely payments.

References

• MarketWatch: New FICO Model May Boost Some Borrowers' Scores
• Mortgage News Daily: FICO Speeds Rollout of New Product to Meet Lender Demands

Resources

• Credit Infocenter: Fair Isaac's FICO 08 New and Improved Scoring Model