cancel
Showing results for 
Search instead for 
Did you mean: 

How to improve credit scores using a credit card

Member

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

7 REPLIES
Valued Contributor

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.


Quicksilver WMC $20k | JCPenney Platinum $10k | Drive for Five $800 | Freedom VS $5k | TD Cash VS $5k | CFU VS $14.8k | Blue Sky $13.7k | IT $28k | SavingStar $14.8k | BCE $11.3k | Macy's AMEX $7.2k | BuyPower WEMC $7.5k | CSR VI $13.3k | Diamond Preferred $6.5k FICOS: EX 775 EQ 764 TU 759 VantageScore 3.0: EX 759 EQ 757 TU 762
Valued Contributor

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


Last Pulled EQ: 809
Last Credit Card App: 02/05/2016
Last CLI: 02/06/2016
Find Me: Gardening
Moderator

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 5 561, TU 98 567, EX 2 599 (12/30/11)
Current Score: EQ 5 771, TU 4 758, EX 2 758, EQ 8 795, TU 8 762, EX 8 786 (7/28/17)
Goal Score:    EQ 5 750, TU 4 750, EX 2 750, EQ 8 800, TU 8 Blah, EX 8 800 (01/01/18)


Take the myFICO Fitness Challenge
Valued Contributor

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! Smiley Happy Last App: 4/5/13 Gardening until July 2014
Valued Contributor

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! Smiley Happy Last App: 4/5/13 Gardening until July 2014
Valued Contributor

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.


Last Pulled EQ: 809
Last Credit Card App: 02/05/2016
Last CLI: 02/06/2016
Find Me: Gardening
Highlighted
Member

Re: How to improve credit scores using a credit card

Thanks everyone for all of the sound advice!