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Member
blbarnes
Posts: 7
Registered: ‎01-24-2013

How to improve credit scores using a credit card

I recently obtained a Captial One Platinum secured credit card. It has a 300 credit limit. This is my first credit card. I recently applied for a mortgage loan and the broker told me I was 20 points from the FICO score needed to be approved. He suggested I get a credit card and pay on time each month in order to increase my scores.

 

My statement due is 2/8 each month. My minimum payment due is $25. My question is how much should I charge each month and when. Also what date should I pay each month in order to increase my scores.

 

Thanks in advance

Valued Contributor
daybreakgonesXe
Posts: 1,652
Registered: ‎11-17-2012

Re: How to improve credit scores using a credit card


blbarnes wrote:

I recently obtained a Captial One Platinum secured credit card. It has a 300 credit limit. This is my first credit card. I recently applied for a mortgage loan and the broker told me I was 20 points from the FICO score needed to be approved. He suggested I get a credit card and pay on time each month in order to increase my scores.

 

My statement due is 2/8 each month. My minimum payment due is $25. My question is how much should I charge each month and when. Also what date should I pay each month in order to increase my scores.

 

Thanks in advance


First off, make sure to pay your current balance in full.

 

You can charge as much as you want on the card (keep in mind your CL though), but it's recommended not to max it out and ALWAYS pay your balance in full before the due date...have the card report 1-9% of $300 by the statement date...so say for example you put $50 on the card during a particular billing period...by the statement date, make sure only $27 or less reports to the credit bureaus. Then, pay all of that in full by the very latest on the due date for that billing period.

Capital One Quicksilver World Mastercard $10k | JCPenney Platinum $7.5k | Shell Drive for Five $800 | Chase Freedom Visa Signature $9.8k | TD Bank Easy Rewards Visa Signature $5k | Chase Sapphire Visa Signature $10k | American Express Blue Sky $25k | Discover IT $9.5k

EQ FICO 737 TU FICO 746 Credit Karma (TU) 780 Transrisk 816/990 Credit Sesame (EX) 762 Credit.com (EX) 763 VantageScore 3.0 733
Valued Contributor
chnceit
Posts: 1,524
Registered: ‎08-17-2008

Re: How to improve credit scores using a credit card

Keep total utilization below 10% at all times, get another CC because one will not help improve quickly. Try to put down a higher DP for a higher credit line IMO


$100K in Credit
Last Credit Card App: 11/16/13
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Revelate
Posts: 8,322
Registered: ‎12-30-2011

Re: How to improve credit scores using a credit card


chnceit wrote:

Keep total utilization below 10% at all times, get another CC because one will not help improve quickly. Try to put down a higher DP for a higher credit line IMO


OP needs to be pooling cash for mortgage process.  Can increase the deposit later, especially as the CL has no impact on FICO at all when managed properly.

Starting Score: EQ 561, TU 567, EX 599* (12/30/11, EX lender pull 12/29/11)
Current Score: EQ 04 679, EQ 8 708, TU 711, EX 702* (07/14/14, EX older)
Goal Score: 700 on EQ '04 (01/01/15)


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Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: How to improve credit scores using a credit card

Honestly, you can charge up to 80%. 90% is considered maxed out so leave a cushion between that limit of 10-15%. Always pay in full every month.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014
Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: How to improve credit scores using a credit card

Oh and make sure your payment is before the statement cuts.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014
Valued Contributor
chnceit
Posts: 1,524
Registered: ‎08-17-2008

Re: How to improve credit scores using a credit card


Revelate wrote:

chnceit wrote:

Keep total utilization below 10% at all times, get another CC because one will not help improve quickly. Try to put down a higher DP for a higher credit line IMO


OP needs to be pooling cash for mortgage process.  Can increase the deposit later, especially as the CL has no impact on FICO at all when managed properly.


I agree to your statement that CL does not play a role, but having two or multiple TL's reporting with history does. Plus a higher CL will help overall UTI if a higher balance is reported by accident IMO

But your right save your money for a DP on your new house.


$100K in Credit
Last Credit Card App: 11/16/13
Member
blbarnes
Posts: 7
Registered: ‎01-24-2013

Re: How to improve credit scores using a credit card

Thanks everyone for all of the sound advice!


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