How App-o-Rama Impacts Your
Credit Score
Before considering an App-o-Rama, you need to evaluate the effects it will have on your ability to borrow money for other purposes. The significant downside of an App-o-Rama is that it will lower you credit score, perhaps dramatically.
Your credit score (also known as a FICO score) is that magic number that nearly all lenders use to evaluate whether or not they should lend you money, how much and under what terms. Your score will range from 300 - 850, with anything over 720 considered to be excellent, while a score under 600 marks you as a low quality borrower. App-o-Rama will cause your score to decline sharply within hours, which is why it is so important to apply for all of the credit cards in one sitting.
The instantaneous impact on your credit score from App-o-Rama is because your credit score is affected everytime your credit file is pulled. This means for each application you fill out, your credit score will take a small hit. However, most credit bureaus will only take one deduction for multiple inquiries that are conducted during a specific time period to allow for shopping around. For example, if you apply for a car loan and your credit file is pulled by 10 finance companies, as long as it is done in a certain period of time, it only counts as one inquiry on your credit file. This same guideline holds true for credit cards and App-o-Rama as well.
As the activity in your credit file spikes, your credit score will plummet. That's why App-o-Rama is only appropriate for people who have no foreseeable need to borrow money for other purposes in the near future. If you are looking to buy or refinance a car or home, or may need loans for your business or an emergency, do not do App-o-Rama. With a sharply reduced credit score and newly thickened credit report, you may have trouble borrowing any more money or could face unusually high interest rates if you do get approved.
The good news is that with a clean payment history, your credit score should start to recover within a few months and should be back to where it was in less than a year. Even better, your proven ability to service and repay numerous loans could even result in an even higher credit score than when you started! This will leave you well positioned to try a second App-o-Rama, which you may even find to be more profitable than the first!
Finally, we strongly recommend that you subscribe to a credit monitoring service so that you can track the impact of App-o-Rama on your credit history and regularly access your credit score. With so much data coming from so many places, credit files are notoriously rife with errors, so make sure you check your file both after completing your App-o-Rama and again after you paid off all of your loans. Don't let a simple error in your file hurt your ability to borrow.
In addition, make sure you select a service that provides access to your FICO scores, as calculated by each of the three major credit bureaus, so you can gauge when your score has recovered enough to apply for new loans or do another App-o-Rama. While you can now get one free credit report per year from each bureau, they do not provide your FICO scores under this program. As an App-o-Rama expert, you'll want regular and convenient access to both your credit report and your FICO scores in order to correct errors and maximize your profits.
