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Credit advice needed!

New Member

Credit advice needed!

So I need some advice. I currently have a secured Capital One card with a $350 credit limit that I have had for a little over a year and a Chase Freedom card with a $4000 limit that I have had for almost two months.  I had no credit history up until getting the secured Capital One Card and my current credit score is in the mid 600s.  I am trying to figure out what I should do with the secured card. Should I close it (I really have no need for it and do not like having to pay the fee) and get a regular unsecured card instead with a higher credit limit? How else can I bring up my credit score? I make a great salary and have no debt at all, but like I said, I have very little credit history. I really want to improve my score in the next two year so that I can get a low interest rate when I take out a mortgage. I really appreciate any advice anyone has for me. Thanks.

Message 1 of 10
9 REPLIES
Valued Contributor

Re: Credit advice needed!

If you don't need it, close it and get you deposit back.

 

Once your freedom is 6 months old, you should apply for another card.

 

Are you going to want  car loan soon too? If so, that would be a good thing to have before the mortgage. You should pay it off before you get pre-qualified though.

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


     $17k       $8.5K          Closed          $19k      $6.5k        $24.2k        Closed         $5k       Closed     $8.5k        Closed      @2.49%
Message 2 of 10
Established Contributor

Re: Credit advice needed!


zvonnegu wrote:

So I need some advice. I currently have a secured Capital One card with a $350 credit limit that I have had for a little over a year and a Chase Freedom card with a $4000 limit that I have had for almost two months.  I had no credit history up until getting the secured Capital One Card and my current credit score is in the mid 600s.  I am trying to figure out what I should do with the secured card. Should I close it (I really have no need for it and do not like having to pay the fee) and get a regular unsecured card instead with a higher credit limit? How else can I bring up my credit score? I make a great salary and have no debt at all, but like I said, I have very little credit history. I really want to improve my score in the next two year so that I can get a low interest rate when I take out a mortgage. I really appreciate any advice anyone has for me. Thanks.


The AF is $29? You have to ask yourself the cost versus benefit. I'll break it down (or at least what my thought process is).

 

Paying the AF for a year of credit history. How much this will help? Some probably, but who knows how much.

 

You want all the help you can get to get into that top tier credit rating when you apply for the mortgage. It's could possibly save you thousands in interest on the mortgage versus the AF you will pay on this card. Operative word being possibly. 

 

If I were you? I'd keep the card until you apply for the mortgage. And I hate to pay AFs too. If you want to close it, at least wait until the month before AF comes up again. 

Message 3 of 10
Established Contributor

Re: Credit advice needed!

and welcome to the forums

Message 4 of 10
New Contributor

Re: Credit advice needed!

I would consider keeping it. My reasoning is in line with the poster above. One thing to consider is to call a month or two before the AF hits, and request for it to be waived. You may not be able to get this done with the front line CSRs and may need to contact the EO via e-mail.

I was in the exact same situation two years ago; I had no revolving history. I opened a Cap One secured and an Orchard Bank unsecured. They both did their jobs and got me my mortgage with a great rate, so I gladly paid the annual fees the first year. Second year came around, and I axed the Orchard; however, I kept the Cap One after contacting the EO for the fee to be waived permanently on my Green Cash with them. They removed the fee on both accounts, so I now have a free two year old tradeline that will continue reporting as long as I remember to use it occasionally.
Message 5 of 10
Senior Contributor

Re: Credit advice needed!


zvonnegu wrote:

So I need some advice. I currently have a secured Capital One card with a $350 credit limit that I have had for a little over a year and a Chase Freedom card with a $4000 limit that I have had for almost two months.  I had no credit history up until getting the secured Capital One Card and my current credit score is in the mid 600s.  I am trying to figure out what I should do with the secured card. Should I close it (I really have no need for it and do not like having to pay the fee) and get a regular unsecured card instead with a higher credit limit? How else can I bring up my credit score? I make a great salary and have no debt at all, but like I said, I have very little credit history. I really want to improve my score in the next two year so that I can get a low interest rate when I take out a mortgage. I really appreciate any advice anyone has for me. Thanks.


I think you should add 1 more CC to your history.    So I suggest you apply for another unsecured card and then I suggest you close the secured card after before the next AF.  Try the Captial One online prequalify as they might offer you something you like.  

 

Getting an installment loan would help your credit mix and score.   Other than that, time will improve it.

Message 6 of 10
New Member

Re: Credit advice needed!

Thank you guys for your help.  I think I am going to hang on to it, at least until the next AF comes up.  Unfortunately I won't be getting any car loan - I am in New York City and have no where to park it!  Any other suggestions for other unsecured cards to apply for or other ways to boost my credit score? Thanks again for your advice.

Message 7 of 10
New Contributor

Re: Credit advice needed!

I would recommend Discover It, personally. I'm sure many others would too. It compliments the Freedom well, their customer service is great and the Shop Discover mall is awesome.

A Barclay card would likely be another viable option for you. I have the Priceline Visa for the flat 2% everywhere.

Your scores are borderline, but both have credit analyst departments for manual reviews. If you are declined initially, your clean history would likely get you an approval with a set of human eyes.
Message 8 of 10
Established Contributor

Re: Credit advice needed!


zvonnegu wrote:

Any other suggestions for other unsecured cards to apply for or other ways to boost my credit score? Thanks again for your advice.


Well another suggestion, altough I am not an expert on the subject, would be to get a small installment loan.  Check with your local bank and see if they report installment loans (secured even) to the bureaus.  You will have to eat the interest for a loan you may not even need, other than to raise your scores.


TU713, EQ 731 , EX 726 (As of 12/13/14) - Personal Goal = 760

“Beware of little expenses. A small leak will sink a great ship” – Benjamin Franklin

Gardening since 3-26-15































Message 9 of 10
Highlighted
Valued Contributor

Re: Credit advice needed!


zvonnegu wrote:

Thank you guys for your help.  I think I am going to hang on to it, at least until the next AF comes up.  Unfortunately I won't be getting any car loan - I am in New York City and have no where to park it!  Any other suggestions for other unsecured cards to apply for or other ways to boost my credit score? Thanks again for your advice.


Personal loan?

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


     $17k       $8.5K          Closed          $19k      $6.5k        $24.2k        Closed         $5k       Closed     $8.5k        Closed      @2.49%
Message 10 of 10