Are multiple credit cards too much of a good thing? Plus, relationships matter: when a good credit score isn’t everything

Media Contact: Lucie Fornasiero; EAFocus Communications;; 248.925.6726; Barbara Fornasiero; EAFocus Communications;; 248.260.8466

Wyandotte, Mich. — July 27, 2021 — Often viewed as a mysterious topic, the relationship between credit cards and credit scores is not as complicated as it is often made out to be, according to Carma Peters, CEO of Michigan Legacy Credit Union.

Peters says that while credit cards are a tool to bolster credit, they must be used strategically.

She offers guidance on what consumers need to know about using credit cards to build a solid credit score:

  • Only open as many credit cards as you can manage; a good rule of thumb is one or two major cards.
  • All credit cards are not created equal; cards from department stores/retail often have higher interest rates, so keep that in mind when making purchases you will not be able to pay for in full when the bill arrives.
  • For major credit cards, be cautious of rewards – you may be paying a fee or higher rate for “reward” perks you may never use.
  • Pay off your credit cards on time because a late payment will ding your credit score. A payment over 30 days late will remain on your credit report for seven years. The effect on your credit score? It will be reduced for one year starting from the last late payment.
  • The largest negative impact on your credit score is keeping a balance that exceeds more than 50% of your limit.

Although wise credit card use and establishing good credit are excellent personal financial goals – and a higher credit score can help secure a more favorable interest rates when borrowing for a home or car – Peters notes that a high credit score isn’t the only way to get a good interest rate. According to a recent Wall Street Journal article, the FICO stranglehold on credit scores may be easing, making a relationship with a lender even more valuable when seeking flexible credit.

“Perfect credit isn’t necessary to get a loan. While a higher credit score is desirable, many consumers don’t realize that it’s also important to have a good relationship with your lender, should you experience financial challenges,” Peters said. “This is especially critical for those who have a history of bad credit. In that case, a smaller financial institution may be a better option for credit cards and other financial needs.”

Peters adds that many smaller institutions, such as credit unions, make local decisions and have more flexibility to work with consumers who have experienced financial hurdles.

“Borrowers need to ask the lender how to help them get a better rate. For example, some lending specials offer rates that are not based on credit scores, so it’s important to ask the lender about all of the rate options before signing on the dotted line,” Peters said.

About Michigan Legacy Credit Union
Michigan Legacy Credit Union (MLCU) is a member-owned, not-for-profit financial cooperative serving members who live, work, worship, attend school, or own a business in the state of Michigan. Michigan Legacy Credit Union is committed to providing quality financial services at a competitive price, delivered professionally and efficiently while keeping member/owners and their needs first. For additional information on MLCU, visit: