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I am convinced junk begets junk: I spent years with crap1 and Orchard junk cards with 300 dollar limits- and what good is a 200 Target card? I think these cards are a chargeoff waiting to happen:
Here is what I did and it helped me tremendously. I joined a credit union and opened a savings account- each paycheck I had $100 direct deposited to the account. After 10 pay perionds- (20 weeks) I had $1000. I used that amount to get a secured card. I try to keep the balance below 400 and pay in full every month. I have yet to pay a penny interest on that card. That card has created trust from the credit union, I have since re-financed my auto loan and got a $5000 line of credit, that I can use as a signature loan anytime. I think the key is getting above that $1000 mark before getting the secured card. Right now I'm not so concerned about my actual score as I am about building a good history and trust from the credit union- The scores will come in time. In a few months my year is up- I've will then have a unsecured card and a $1000 in a savings account that I didn't miss at all.After this I was able to get a 4000 Chase platinum. My scores were not in platinum range but I'm convinced by waiting for my first $1000 card to mature and then asking for additional credit I was able to look better in the eyes of lenders. My goal for 2009 in NO inquiries ( unless I feel brave enough to apply for a mortgage)I weeded them out. When do you plan on trying for the new house? I think I would wait until you get that mortgage (unless your scores are really low and you have a year of building new credit)
Be careful making any changes prior to the home loan, that includes applying for new cards.
Awesome advice moondog. After reading this thread, I paid the $20 for membership to be able to join PenFed and signed up for a Share account.
Once I get my welcome package in the mail, I'll sign up for auto-debit from my checking account for $100 every two weeks just like you did.
I had been looking for a good local CU to join, but I keep hearing nothing but good things about PenFed, so I decided to pull the trigger.
Kudos to you!
I've heard great things about PenFed- I used NFCU. The other nice thing is member specials- such as GEICO auto- I saved $$ just by joinig through the NFCU website.
If you have the patience to get to th 1000 mark, it does two things: creates good relationship with the CU and most importantly, creates good savings habits.