There’s a good reason people don’t put their proverbial eggs in one basket.
If it dropped, you’d be egg-less.
The same concept comes into play when considering which credit cards to open, explains Credit Sesame credit expert John Ulzheimer.
Getting every card from the same bank is asking for trouble.
“I don’t think you should ever put all of your eggs in one basket like that,” he says, “especially when it comes to credit cards, when there are so many reputable issuers and so many options to choose from.”
“First of all,” Ulzheimer points out, “you don’t know if there’s a more competitive offer somewhere else, because you’re doing business with just one issuer.”
“Also,” he adds, “you’re completely subject to the whim of that credit card-issuing bank. If they want to unilaterally close your accounts or increase interest rates or charge more fees, then what are you going to do? There isn’t a backup you can use.”
From a credit score perspective, he clarifies, it makes no difference which bank issues your cards. “By and large, credit score models are blind to whom you’re doing business with.” That means while the credit bureaus and subsequent lenders can see what type of account you have — student loan, credit card, mortgage — they don’t have the details.
As far as having a contingency plan, however, the safer bet is to spread your allegiance among multiple institutions. “Despite how well they might treat you today,” cautions Ulzheimer, “you don’t know how they will treat you tomorrow.”