So my credit scores are in the tank because I've got 3 chargoffs and about 3 more accounts with late payment histories and settlements for less than full balances. All of those negative accounts are now closed, obviously. But I've also got two accounts--a credit card and a line of credit with my bank that I have kept current all along. Other than the fact that opening a new line of credit would increase my total amount of credit available, is there a substantial reason for me to want additional lines of revolving credit open just to have more lines of credit open? I doubt would qualify for a credit card at this moment anyway. But I see the ads for "credit cards for bad credit / fair credit, etc." I guess my question is: If I already have a credit card that was opened when I had good credit and remains current and open, is there any reason for me to want to open another account just for the sake of having another account open?
Well, increasing your total available credit and improving your CU ratio over time would obviously be important reasons. That accounts for a large chunk of your credit score. However, I also think it's smart to carry at least 1 or 2 backup cards these days because you just never know when a credit issuer will decide to substantially slash your credit limit or even close your account. There's nothing in the CARD Act that will prevent that from happening, and they don't even need to give you advance notice. It's very common these days. I have perfect credit, and I even had one of my Citi cards closed without notice last year. Very annoying....arrrgggghhh. If you only carry one card, you run the risk of all of a sudden having no credit at all. Bad credit credit cards are designed for people who have had problems in the past and are trying to rebuild their credit histories, so you may want to look into your options. The fees/rates will be higher than your average card, but for many people it's worth it to have a product that will help them rebuild their credit histories. OTOH, if you don't think you're ready to manage more than one card and always pay on time, it's probably a good idea to just wait until you are.
With all due respect to Joshua's excellent comments, another thing you might want to do is work towards getting rid of all the adverse stuff as quickly as possible.
I agree with Josh and Bill. Take care of the bad items and open a few more accounts just to be safe. I cannot strongly reiterate enough about Josh's comments as to account closure and the like. It's like a firestorm.
