New at this... please help if you have time. Auto loan and overall credit question

[Anonymous]

Hello everyone,

Thanks for taking the time to read my question.  I lived overseas for a decade and have just relocated back to the US for work purposes.  I came back to a blank slate and have started building from 0.

• 6 months ago I got a secured credit card from my CU for $500 and have never missed a payment
• Last week I got approved for the unsecured Capital One Platinum and Credit One unsecured.  Both for $300 (I applied when my scores were low because I had the utilization on my secured card above at 90% for a month but have since paid it off)
• I also got a Fingerhut account and have ordered stuff to get a $100 balance and start paying it off
• Today I got the myFico service and my 3 scores are 593EQ 609TU 643EXP

Keep in mind my utilization still shows high but I already paid down my credit card and I'm waiting for it to be updated.  The myFICO calculator said that my score should be the following: 703EQ 679TU 718EXP

I don't know how accurate these calculators are but that's a pretty big jump.  My goal is to buy a brand new Nissan Rogue.  I have $4000 cash for a down payment if needed.  Will Nissan be too turned off by my limited credit history?  Those new CCs and the Fingerhut aren't in my report yet and I didn't want to wait 3 months or so because I need the car now.  I imagine I wouldn't feel bad if I knew for sure that these were going to be my scores after the big 3 are updated of me paying down my CC but I just don't know how accurate they are.  What's the consensus on the way Nissan works in North Carolina?

[jeffm4688]

My thoughts would be,

Do yourself a favor and don't get cards you don't need (or are predatory). You're working on establishing credit and not rebuilding, no need for credit one or any other junky cards with capital one/etc. Just pay attention to your balances along with statement dates/etc. With a thin history and ~700+ FICO's there are other options for you (like discover comes to mind).

Focus on cards that will help you by not costing you a fortune, benefit you in your spending categories and most importanty will grow with you. You only need three credit cards for maximum scoring, any more than that is up to you.

Current card wise if I were you would be:

• Cancel credit one before the 1yr is up(and DO NOT use it at all). There is no grace period, and the cashback literally will not amount to the interest you will end up paying. It's not worth it.
• Capital one platinum I'm assuming has a $300 limit, credit steps and some kind of annual fee. My recommendation is spend wisely, pay off in full. Ask for a credit limit increase after 2nd statement(or is it 3rd?) and of course as always call up in a few months and ask for an upgrade(to remove annual fee, and earn some rewards)
• I don't have experience with fingerhut, but it's probably not something I'd keep around too long, no need to spend money on their website to benefit you as I have heard they are overpriced.

As for the car loan aspect, this is difficult. I don't see an approval with such little history even with 4K down unless you have a co-signer with good credit.

My suggestions would be, either take the 4K and buy a car outright, while continuing to save and thicken your credit file. Or find a co-signer.

You can always step into your local CU and ask to speak with a loan officer who might be able to give you insight on what to expect, be it approval chances/interest rate/down payment requirements. Other than that a pre-qual with capital one is also possible, but I'm not sure with how thin your file is. You'd want to wait until after that CU card shows paid down.

[Anonymous]

Thank you for replying to my question.  I was aware that these Cards aren't ideal, I was willing to take them on and swallow the interest while I built my credit.  I haven't even received the CreditOne card or activated it.  I will keep the Capital One and try to upgrade it as you suggested.

Fingerhut is definitely over priced, but I only bought a slow pressure cooker I wanted and won't be buying anything else.  I plan to make the minimum payments on it to help establish more credit history.  It's too bad about probably not being financed for a car purchase, I was hoping that I would get approved with a high interest and make some payments and get it refinanced later.  I was hoping the car loan would help add to my credit history.  I want to purchase a home in about 8 months or so and I am hoping my credit will be ready by then. Right now I am trying to get my CU to upgrade my card to a unsecured card and to increase my credit limit.

[jeffm4688]

I wouldn't be buying a car right before looking for a mortgage (and I would make sure to hold off on applying for anything else) as well until after closing. While grabbing an auto loan will help your credit mix I don't believe it will help you enough in such a short period of time when it comes to obtaining a mortgage. The payment of this auto loan is also going to negativly affect your DTI as well. I may get corrected, but this is at least my take.

If anything I'd be trying to scrape by without buying anything until after the house, and after closing you can grab any credit cards/auto loans. 

[Anonymous]

Thanks for your advice so far.  I have had a busy time.

I got my Secured CC from the Credit Union upgraded to an unsecured with a better interest rate and no annual fees

I applied for an Autoloan at the credit union (i figured, why not? i have the hot hand) and they approved me for 20k at 6.79% APR and didn't even need a cosigner

I will not be activating and using the Credit One

I accepted a job at Bank of America and hope to use the employee discount to secure a home loan later on.  

[surferchris]

Congrats on the cards and in regards the new job!