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@bdhu2001 wrote:
@Anonymous wrote:HI, I'm new here! Hello everyone!
A lil background:
I'm in the market to apply for a mortgage next year in July coming off a chapter 7 bkrtcy over 3 years ago. I have a Credit One card that I have had over a year to establish my credit. But I am sooo over them! I got married last year and they wanted to charge me a fee to change my name with them??! So I want to get rid of them! I have a Capital One Credit card now with $1800 limit and I am good with that. I owe Credit one $200 dollars. So my question is...do I pay them to a 0 balance then cancel immediately or should I let the 0 balance show for a few months or cancel the card then pay it off?
Any help is greatly appreciated! Thanks!
If you're wanting to build up to a mortgage, one credit card isn't enough. If there is no fee associated with the card, keep it. I don't recommend paying interest. So if you can pay off the $200, pay them off. Use your credit one card for an auto pay of a small bill like water. Pay the credit one automatically so that you don't pay interest.
If they charge to change your name, don't change the name on the card. Let that be the card you use over the Internet and to auto pay bills.
Rebuilding credit is a journey, not a sprint. Take the time to make the right decisions for the outcome you'd like to obtain. You didn't mention the credit limit on your Credit One card. Remember that you need to keep your utilization below 25% overall and below 25% on each individual card. If you can keep your utilization below 9%, it's even better.
My credit limit is $650.00. They are charging me an Annual Membership fee which is Total ($99.00) but they break up in payments of $8.25/per month. And interest on my balance. I only have this credit card and a Capital One card with $1800 limit which I am paying down as I have a $1400 balance. I have a car payment, student loans and Care Credit account I am paying off $4000 limit...paid down to $2500 as of right now. That's it.
So many good ideas here. But do you think I can do away with this card and get another one with better terms and still be in the running for a mortgage approval?
@Anonymous wrote:
@Anonymous wrote:Ok, quick question. My due date is 12/14.....If I pay balance and close today, I should not be charged interest right? Unless they try to be sneaky....But I will request they send me a letter to show I closed the account today.
Incorrect. Credit One charges interest from date of purchase... it just doesn't post until your statement. If you pay the balance today, your next statement will show the interest compounded through today; still due and payable.
Ok, that makes sense. Thanks!
@Anonymous wrote:My credit limit is $650.00. They are charging me an Annual Membership fee which is Total ($99.00) but they break up in payments of $8.25/per month. And interest on my balance. I only have this credit card and a Capital One card with $1800 limit which I am paying down as I have a $1400 balance. I have a car payment, student loans and Care Credit account I am paying off $4000 limit...paid down to $2500 as of right now. That's it.
So many good ideas here. But do you think I can do away with this card and get another one with better terms and still be in the running for a mortgage approval?
Back in 2009, I qualified for a mortgage with best rates with only one open credit card. So you don't need to have more than one open credit card to get a mortgage. However, having at least three credit cards makes it easier to max out your credit score.
Personally, I think your installment loans added to the Cap1 and Care credit cards will be enough for a mortgage. However, if you want the third open revolving credit line, I would do the shopping card trick. There are several shopping cart trick cards that are fairly easy to qualify for. Just make sure it is for a store you shop at. Your score may still take a slight hit due a reduction in AAoA, but at least you wouldn't take a hit for the new INQ/HP.
If you are going to be applying for a mortgage in 7-8 months, you should be careful about applying for more credit.
Get rid of it, close it and move on it has served it's purpose. Plus, you'll get the good rating for another 10 years on your credit report. These cards aren't mean to be kept a long time,they get you started, you get other better cards and move on.... Good Luck....
@Anonymous wrote:
@Anonymous wrote:Ok, quick question. My due date is 12/14.....If I pay balance and close today, I should not be charged interest right? Unless they try to be sneaky....But I will request they send me a letter to show I closed the account today.
Incorrect. Credit One charges interest from date of purchase... it just doesn't post until your statement. If you pay the balance today, your next statement will show the interest compounded through today; still due and payable.
Wow!!! Thanks for that information. This doesn't sound like a card worth using or having. With a $99 AF and instant interest charges, there doesn't seem to be any point in keeping the Credit One card.
My suggestion. Dump the card as soon as you can and get some real prime cards if you want once you're done getting that mortgage.
@Anonymous wrote:
I also have a credit one that I got in August and plan on closing it in July (before my next AF is due) so I have also been looking into the best way to close it....
quickly!