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B of A secured card with established credit but high utilization?

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Math_Rocks
Established Contributor

B of A secured card with established credit but high utilization?

I have multiple questions as the year draws to a close so I'm going to try to split them up and get to the point with each:

 

Question #1 - I wish to be app-free in 2009 and recently went on my 2nd app spree for the year. Not surprisingly, the recent one didn't go as well as the one this summer. One result is that I was declined for a B of A card but offered the secured card. We've had a huge cut in income recently but have been managing to keep up with the bills and I have $500 set aside as a backup. Should I use this money to get the secured card?

Filed Chapter 13 April 2012. Case successfully closed May 2017, about 1 month after 60th payment. FAKO scores on close date: TU 695 EQ 697. Received discharge July 11th - took forever! Real EX day of discharge 624.
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llecs
Moderator Emeritus

Re: B of A secured card with established credit but high utilization?

IMO, don't do if your mix of credit is OK (at least 2 revolving and one charge like a store card). If you have that, then adding more cards will only negatively impact your AAoA and score. You can have excellent util with low limit CCs. Just PIF each month or leave $1 on half with the others at $0.

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Math_Rocks
Established Contributor

Re: B of A secured card with established credit but high utilization?


@llecs wrote:

IMO, don't do if your mix of credit is OK (at least 2 revolving and one charge like a store card). If you have that, then adding more cards will only negatively impact your AAoA and score. You can have excellent util with low limit CCs. Just PIF each month or leave $1 on half with the others at $0.


 

This is the disadvantage of trying to get to the point but leaving out information! My app spree this summer is what helped us go from about 70% utilization to 50% and to BT away from a creditor that had ratejacked us. So, most of the new stuff from this 2nd spree will have low util but haven't really found anything to be a buffer if we have to try to get away from another CCC. I hope that makes sense!

Filed Chapter 13 April 2012. Case successfully closed May 2017, about 1 month after 60th payment. FAKO scores on close date: TU 695 EQ 697. Received discharge July 11th - took forever! Real EX day of discharge 624.
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Anonymous
Not applicable

Re: B of A secured card with established credit but high utilization?


@Math_Rocks wrote:

I have multiple questions as the year draws to a close so I'm going to try to split them up and get to the point with each:

 

Question #1 - I wish to be app-free in 2009 and recently went on my 2nd app spree for the year. Not surprisingly, the recent one didn't go as well as the one this summer. One result is that I was declined for a B of A card but offered the secured card. We've had a huge cut in income recently but have been managing to keep up with the bills and I have $500 set aside as a backup. Should I use this money to get the secured card?


If you have that $500 set aside for backup, in case something happens, I wouldn't use that for a secured card.  It's one thing if the economy is great and your income level is probably going to stay the same, but you sound as if things are a lot worse for you.  You didn't say "we had a huge cut in our salary, but we're having no problems paying our bills and still have excess to save for a rainy day."  You said "we're managing to keep up with the bills."  That to me sounds like someone who needs to keep the money they have as backup continued as backup just in case their's an emergency or there's another huge cut in salary.  

 

IMHO, sometimes there are things more important than your FICO score.  I'm not saying don't pay your bills and let your score tank, but having a better credit mix is less important than having the money set aside for an emergency.  

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