New Plan - Just want opinions

[Anonymous]

ch.7 bk, havent even had my 341 yet but im feeling great and wanted to get ahead of schdeule on my rebuilding plan ..

Okay so I thought about this today to help me reestablish my credit and I just wanted to know what yalls opinions were:

I am going to get 6 SSC's (Secured Credit Cards) because I need to garden as much as possible until some inquiries fall off my report.

Armed Forces Bank SCC  - $500 (only using $50)

Chartway FCU SCC - $500 (only using $50)

Suntrust Bank SCC - $500 (only using $50)

Citi SSC - $250 (only using $10)

Cap 1 SCC - $250 (only using $10)

Discover SCC - $250 (only using $10)

Self Lender Credit Builders Loan for $1000 to renew after 12 months for another $1000

This way my CC bills will be $200 or less. Im going to do this for 12 months first then see if I can get a CLI or if not, add double the amount to the card (add nother $500/$250 in secured funds) and maintain that for another year.

So after 2 years, ill have a solid payment history and then see if I can get a CLI if I havent already gotten it at my 12months.

With my CC bills being $200 or less, I can save some of my paycheck, which I said I was going to put away $700 a month. So $250 from each check will be going to my Emergency Fund, and $100 from each check will be going to my Savings account.

I will not have a car note, insurance, rent, since I stay with my parents and im driving my moms other car

After 2 years, I will have $12,000 in my emergency fund and $4800 in my savings. I will put the funds from my Emergency Fund into a Money Market Account. My savings will be just there.

After my two years is up, I will then take $2000 out of my savings and put as a down payment on a new car.

6 months later I plan to apply for my first mortgage.

Questions for yall if yall care to answer ..

When should I get the SSC's and start rebuiliding.... after my 341 ? 

Do yall think this is too many CC's ?

Should I do a Money Market account or a CD ?

When should I apply for the CLI increase to BETTER my chances of getting approved ?

[Anonymous]

Your plan sounds amazing, as long as you know you can still get declined for Secured Cards, unfortunately. 

Especially if the creditor was burned in the BK.  

Also, I have checked into the Citi Secured and it says on their site that it's not an option until 2 years post BK. :-(

[Anonymous]

Hi again br/woke!

With the secured cards, I would start out with the ones who have prequal pages that give you solid offers. Cross-reference with the BK friendly thread e.g. Citi is known to be not BK friendly for those of us with fresh dc's.

(With the below, if I misunderstood you... ignore me!) 

Also, I am not sure if you are understanding the AZEO system - it seems like you have read it - but aren't quite "there" with it yet (no worries!) AZEO stands for All Zero Except One. This means that whenever your score is pulled (your monthly report, or when it is pulled for a loan app, or etc.) you will want only one card reporting a balance, and all other cards reporting zero. The one card reporting a balance should have less than 8.9% of your aggregate credit limit (e.g. if that card has a $500 CL, but my other two cards have $1,500 and $3,000, then I want it to have > $10, but < $445.00 reporting). But you also don't want a single card to go over 50% of its individual limit. 

And one more thing. Try for unsecured cards if the prequals show them. You'd be surprised what you qualify for! If you don't prequalify for them, then yes, go for secured. But hey... why tie up your cash when you don't have to, right?

As far as how to pick which card to AZEO with, I use all of mine but only let one report a balance. Some people rotate theirs monthly. Etc. You'll find a system that works. 

Different cards have different rules for CLIs. If you are secured, you may not be able to apply for CLIs until you are unsecured.

As far as the savings, that is terrific! Automatic savings is the best way to go. You may wish to ask the savings related question in the Personal Finance forum, you may get more answers there. 

[Anonymous]

I agree with capabk. In short, the number of secured cards seems excessive, especially considering that you may get declined for some. Do all of them graduate? 

It's a better idea to apply for one secured card and and secured loan, and look at unsecured cards like Capital One. 

Alternatively, with credit unions  like Navy  Federal, you can do a secured loan, and use those funds to establish a secured credit card. If you have a bunch of small limit cards, you may find yourself stuck with smaller limits longer. Alternatively, if you get a higher limit secured card, you'll automatically have a higher limit unsecured card when it graduates. 

[Anonymous]

I read your tag and I have a question.

I had Navy Federal a long time ago. I had an Auto Loan which I settled and a Checking Account which I settled also. I remember the woman telling me that in order for me to reopen an account with NFCU, I would have to pay off the difference of the checking account and write a letter stating why I would like to become a member ... Is this true ? She said that they are not actively collecting on the difference of the money.

My husband is a veteran so I should qualify.

[Anonymous]

I thought that i understood that right. I wish they had some youtube vids to watch.

I took it as all card would need to be used less than 10% of the total amount. I was going to use it for small subscriptions like spotify and myFiCO.

[Anonymous]

I personally think it's too much too fast and wouldn't want all of those inquiries on my reports immediately post BK.

Having a bunch of toy limit secured cards seems annoying. 

I also think it's useless to get secured cards that won't graduate to unsecured.

While secured cards can help a rebuild immensely, I personally don't care for them. My rebuild was strictly on unsecured cards and I'm darn happy with where I'm at today.

[Anonymous]

Don’t look at your cards as a monthly payment, this insinuates you’re going to be carrying a balance. To re-establish credit look at your bills (food, insurance, gas, etc) and see how many you can pay with your credit card, and then in turn pay off in full every month. You don’t need to carry a balance to build credit. So you shouldn’t need a credit card budget. You need a budget based on cash. I haven’t tried AZEO yet but it looks as if it simply times when the PIF happens, first comes your stament and next is your PIF before the due date. The cards you want at zero you simply pay before the statement cuts.
I think it’s good to plan things out before acting, I’m the same. Thanks to advice from here , I’m just getting used to making several payments a month. I’ll try AZEO soon to see how high my potential score gets. I’m only one month post and my FICO8 scores are 629/586/642. I have a new car and 4 revolvers, only one is secured. No need to tie up all that cash in secured lines! Sit tight, you’re going to be just fine!

[Anonymous]

Navy Federal a credit loss, you are ineligible for obtaining additional credit until the loss is repaid -- even if your obligation to repay the loss was discharged in bankruptcy.

As far as membership goes, as long as you are eligble for membership, you may re-establish checking/savings accounts after the credit loss accounts are discharged. If you had only settled and NOT filed bankruptcy, you would be eneligible to open any new accounts.