Jump to content

Please consider disabling your adblocker for CreditBoards if you have not already done so.  This site depends on advertising revenue to stay online.


Sign in to follow this  

Credit Rebuilding Update

Recommended Posts

Hey guys, so I paid off all my collections and am currently in the process of rebuilding my credit. After all my collections were paid off and i had pay for delete contracts with all the agencies. I applied for a credit one bank platinum credit card and got accepted. The limit is $300, and I also have a self lender secured credit card with $100 limit. I have the self installment loan, a kik installment loan as well. My credit score on fico is now 620 according to experian. I just want to know what the next step should be? Should i use 5%-10% of my new $400 combined credit limit ? I'm so excited that I got approved for a unsecured credit card, really want to build my score up enough to get something like a chase freedom, or an american express.

 

Before my rebuilding process my score was 545, it is now at 620.

 

All tips are appreciated. 

Share this post


Link to post
Share on other sites

Like your name and congratulations, try and keep your balances around 10% of your credit, look into getting one more card and use responsibly - possibly the Cap One master card which is easy to get.  If that doesn't work try a secured card and don't apply for anything aside from a soft pull card, garden about six months and then you should be able get a nicer card, might help if someone in your house can add you as a AU but you might want to get one more card.  

Share this post


Link to post
Share on other sites
On 7/25/2020 at 11:33 AM, FahimAlamShakie said:

Hey guys, so I paid off all my collections and am currently in the process of rebuilding my credit. After all my collections were paid off and i had pay for delete contracts with all the agencies. I applied for a credit one bank platinum credit card and got accepted. The limit is $300, and I also have a self lender secured credit card with $100 limit. I have the self installment loan, a kik installment loan as well. My credit score on fico is now 620 according to experian. I just want to know what the next step should be? Should i use 5%-10% of my new $400 combined credit limit ? I'm so excited that I got approved for a unsecured credit card, really want to build my score up enough to get something like a chase freedom, or an american express.

 

Before my rebuilding process my score was 545, it is now at 620.

 

All tips are appreciated. 

Try to avoid the low-hanging crapola like CreditOne.  They are as much of a stain on a credit report as the bottom feeders like First Premier or Aspire.  There are reasons the fee-laden POS offerings take just about everyone...they KNOW the consumer will screw up and miss payments somewhere along the line. 

 

As to percentages to use, the issue is NOT how much is used during the month but rather what reports.  There are plenty of FICO high-achievers who bump the caps of five- and six-figure cards every month.  The key is paying in full and not letting those balances report whenever possible.  There are some exceptions, to include when one has a zero-percent offer in play and you are making money with the bank's money.  You will always want to be wary of lenders who report mid-cycle since that can screw up strategies as well...

 

Something else to keep in mind is that Fair Isaac models (the only ones that really count) look at utilization on more than just a total basis.  There is also the card-by-card elements where the algorithm considers the number of cards with a balance to the number of cards.  This is why a balance reporting on one account when you only have one or two accounts is far worse than the consumer who has a balance reporting on one out of fifteen or twenty cards.  

Share this post


Link to post
Share on other sites

Good for you for taking these first important steps.  Next step is to refine and grow your portfolio.

 

How much is Credit One charging you every month/year to have the card?  If there are a bunch of fees and/or has no grace period on purchases, it's already time to replace it.

 

Right now your challenge is to find a balance between getting to 5 cards relatively quickly (front-loads the AAoA hit to your profile and creates an AAoA anchor over time) and not accepting subprime cards that have nowhere to take you in the future.

 

There isn't much incremental benefit to having two installment loans reporting, vs. one.  You can repay one of those in full, and when they return the security deposit you can open up a quality secured card, or in about six months you can try for an unsecured Capital One card (they may already give you one, but standard rules don't always apply in the middle of a pandemic). 

 

Since the long-term goal is a thick long-term profile you want to get to at least 5 open revolving accounts -- major credit cards (V/MC/AE) from quality issuers -- because you want relationships that serve you long-term. 

 

 

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this  




  • Member Statistics

    • Total Members
      179,463
    • Most Online
      2,046

    Newest Member
    MrsOKW
    Joined

About Us

Since 2003, creditboards.com has helped thousands of people repair their credit, force abusive collection agents to follow the law, ensure proper reporting by credit reporting agencies, and provided financial education to help avoid the pitfalls that can lead to negative tradelines.
×
×
  • Create New...

Important Information

Guidelines