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Just beginning with credit cards.. help please

New Visitor

Just beginning with credit cards.. help please

I have no credit score at this time and I'm just starting to build.  I have been doing a lot of research but I've found some conflicting information.  I want to try and avoid making any mistakes.  Please let me know if I am on the right track with these credit cards?  

 

In the past couple of days I applied for my cards.  My first was a secured Cap1 because I thought I would have to start there.  Didn't realize I may be approved for anything else but I did a few apps and received a $250 Victoria Secret, $500 Chase Card, and $750 Discover IT.  I don't plan on trying for any other cards. I will let these age and hopefully increase.

 

I will only be using these cards to increase my credit score but I would like to use the Chase and Discover to benefit from the cash back.  I just want to make sure I achieve both of these goals with no mistakes.

 

1)  I will use the Capital One and Victoria Secret card, occasionally,  to make sure they stay open.  I will pay these in full prior to the statement being put out.  

 

2) I plan to use the Chase and Discover for my "normal" expenses when there is opportunity to benefit from cashback. I want to keep utilization at 10%.  I will keep 10% of my total card availability on the Chase or Discover card because they offer 0% APR for the first year.  I will pay the rest in full prior to the statement being put out.

 

 

Is it ok to keep 10% of total available credit just on those two cards?  

  

Is the amount due on the statement the amount reported and used to determine utilization?

 

If my statement date is the 10th, I will pay on the 5th.  Is that enough time to make sure my statement balance is 0% -10% I plan to carry over?

 

Should I wait a week or any time period after the statement date before using the cards for the next month? 

 

Is it ok to take advantage of the Chase and Discover cash back offers to the fullest extent if I pay prior to the statement dates or is this a bad idea?  Would it be on the report that I used the card too much during the month anyway?

 

Any other suggestions would be appreciated!

 

 

 

Message 1 of 19
18 REPLIES
Super Contributor

Re: Just beginning with credit cards.. help please


thefms wrote:

I have no credit score at this time and I'm just starting to build.  I have been doing a lot of research but I've found some conflicting information.  I want to try and avoid making any mistakes.  Please let me know if I am on the right track with these credit cards?  

 

In the past couple of days I applied for my cards.  My first was a secured Cap1 because I thought I would have to start there.  Didn't realize I may be approved for anything else but I did a few apps and received a $250 Victoria Secret, $500 Chase Card, and $750 Discover IT.  I don't plan on trying for any other cards. I will let these age and hopefully increase.

 

I will only be using these cards to increase my credit score but I would like to use the Chase and Discover to benefit from the cash back.  I just want to make sure I achieve both of these goals with no mistakes.

 

1)  I will use the Capital One and Victoria Secret card, occasionally,  to make sure they stay open.  I will pay these in full prior to the statement being put out.  

 

2) I plan to use the Chase and Discover for my "normal" expenses when there is opportunity to benefit from cashback. I want to keep utilization at 10%.  I will keep 10% of my total card availability on the Chase or Discover card because they offer 0% APR for the first year.  I will pay the rest in full prior to the statement being put out.

 

 

Is it ok to keep 10% of total available credit just on those two cards?  

  

Is the amount due on the statement the amount reported and used to determine utilization?

 

If my statement date is the 10th, I will pay on the 5th.  Is that enough time to make sure my statement balance is 0% -10% I plan to carry over?

 

Should I wait a week or any time period after the statement date before using the cards for the next month? 

 

Is it ok to take advantage of the Chase and Discover cash back offers to the fullest extent if I pay prior to the statement dates or is this a bad idea?  Would it be on the report that I used the card too much during the month anyway?

 

Any other suggestions would be appreciated!

 

 

 


For the cards you pay before statement cuts I think the ccc will think its not being used, I think you need to have like 1-9% report on the statement date. The second thing statement and due date are not the same date. The statement date is usually an few days after your due date. 



EX Fico 804 11/16/16 Fako 800 Credit.com 11/16/16
EQ SW bank enhanced 11/16/16 839 CK fako 822 11/16/16
TU Fico discover 10/19/16 814 Fako 819 Creditkarma 11/16/16
Message 2 of 19
Valued Contributor

Re: Just beginning with credit cards.. help please

Boy, for somebody just getting started, you have quickly gotten yourself into a couple of prime cards (Chase and Discover IT). Are you really sure you have no credit score? It's great, but do you have any idea how you got approved by them?

 

Anyhow, you do sound like your very much on the right track. Now time to garden for six months to a year!

 

To answer some of your questions:

 

Yes, the amount on the card at the statement date is the amount reported to the credit bureaus.

 

Yes, it is okay to keep most of your balance on the Chase or Discover card. MyFico purists would tell you to keep total utilization at 9% or below and have only one card reporting a balance at a time. But 10% and two cards reporting will certainly put you ahead of the average credit card user.

 

If your statement date is the 10th and you pay electronically by the 5th you'll be absolutely fine. If you're mailing payments, allow a longer time.

 

You can use the cards any time after the statement date without fear that the new charges will be reported before you have a chance to pay them off or pay them down.

 

And go ahead and use those cashback offers! You will not be reported for excess usage. You may have to make several payments during the month to keep your balances where you want them, but nobody will worry about you using too much, as long as they see a strong repayment pattern.

 

Nice start!

 

Message 3 of 19
Frequent Contributor

Re: Just beginning with credit cards.. help please

I'd also like to say great start your on the right path! I'd say you should hold those cards for 6 months or so to build a solid history. You are able to take advantage of the 0% APR offers they come with, however do not get used to it and be sure to have them PIF by the time the 0% offer ends. Its not good practice to keep balances on CC's, especially cash back CC's because they tend to have higher APR then non cash back CC's, so all the cash back your earning is pointless, you'd be paying more in APR charges. If you will be leaving balances while in 0% APR period, remember to pay more then the minimum payment.

 

Also with the paying before the statement end date is not totally necessary IMO, its only necessary if you plan on apping for more cards within that next month that the balances would show on your CR. If you don't plan on apping for any new CC's for the next 6 months or so I wouldn't worry about paying before the statement end date until your ready to app again. But definitely pay before the payment date, obviously.

 

Good luck on your journey!

 
Message 4 of 19
New Visitor

Re: Just beginning with credit cards.. help please


Gunnar419 wrote:

Boy, for somebody just getting started, you have quickly gotten yourself into a couple of prime cards (Chase and Discover IT). Are you really sure you have no credit score? It's great, but do you have any idea how you got approved by them?

 

Anyhow, you do sound like your very much on the right track. Now time to garden for six months to a year!

 

To answer some of your questions:

 

Yes, the amount on the card at the statement date is the amount reported to the credit bureaus.

 

Yes, it is okay to keep most of your balance on the Chase or Discover card. MyFico purists would tell you to keep total utilization at 9% or below and have only one card reporting a balance at a time. But 10% and two cards reporting will certainly put you ahead of the average credit card user.

 

If your statement date is the 10th and you pay electronically by the 5th you'll be absolutely fine. If you're mailing payments, allow a longer time.

 

You can use the cards any time after the statement date without fear that the new charges will be reported before you have a chance to pay them off or pay them down.

 

And go ahead and use those cashback offers! You will not be reported for excess usage. You may have to make several payments during the month to keep your balances where you want them, but nobody will worry about you using too much, as long as they see a strong repayment pattern.

 

Nice start!

 


Thank you for all the info!

If 9% or lower utilization reported on one card is best... done!  

 

I was very surprised by the acceptances after reading what to expect.  I had a small business and had signed for several cards as Pres of corp. but stopped working to become a stay at home mom over 10 years ago and closed everything at the time.  My report says no score available.  All are empty accept for the first cc I ever had with a very low credit limit is still on TransUnion and reported as closed. I have no idea why it's on but perhaps it helped?  Maybe age too?  I'm not a student/teenager.  

Message 5 of 19
Valued Contributor

Re: Just beginning with credit cards.. help please

Oh yeah. One other thing. In addition to the statement date (the date the bill is issued), you need to be aware of the payment due date -- which will be a few days before.

 

I think that's what you were probably getting at with your question about paying on the 5th if the statement date is the 10th, but I wasn't sure.

 

In short, your payment due date will usually be anywhere from 3 to 5 days before the statement date. This varies from card to card. Be sure your payment always arrives by the due date, not a single day after that, even if the statement isn't issued until days later.

 

Message 6 of 19
New Visitor

Re: Just beginning with credit cards.. help please


Meltdownblitz wrote:

I'd also like to say great start your on the right path! I'd say you should hold those cards for 6 months or so to build a solid history. You are able to take advantage of the 0% APR offers they come with, however do not get used to it and be sure to have them PIF by the time the 0% offer ends. Its not good practice to keep balances on CC's, especially cash back CC's because they tend to have higher APR then non cash back CC's, so all the cash back your earning is pointless, you'd be paying more in APR charges. If you will be leaving balances while in 0% APR period, remember to pay more then the minimum payment.

 

Also with the paying before the statement end date is not totally necessary IMO, its only necessary if you plan on apping for more cards within that next month that the balances would show on your CR. If you don't plan on apping for any new CC's for the next 6 months or so I wouldn't worry about paying before the statement end date until your ready to app again. But definitely pay before the payment date, obviously.

 

Good luck on your journey!


Thank you!  You are all so helpful!

I don't plan on apping for more cards but hoping it will help build the score quicker to keep utilization low.  Besides, I have no intention on buying anything that isn't able to be paid for at the moment.  I'm hopeful the credit score will help with things like my car insurance.  My two oldest started driving! Realizing my non existent credit score isn't saving me any money on that outrageous cost!

Message 7 of 19
New Visitor

Re: Just beginning with credit cards.. help please


Gunnar419 wrote:

Oh yeah. One other thing. In addition to the statement date (the date the bill is issued), you need to be aware of the payment due date -- which will be a few days before.

 

I think that's what you were probably getting at with your question about paying on the 5th if the statement date is the 10th, but I wasn't sure.

 

In short, your payment due date will usually be anywhere from 3 to 5 days before the statement date. This varies from card to card. Be sure your payment always arrives by the due date, not a single day after that, even if the statement isn't issued until days later.

 


This is where I am completely lost.  I am totally missing this concept.

It's like the chicken or the egg to me.

My cards will arrive this week.  I will use them for the first time... I will get my first credit statement later in the month but I will have paid them prior to that statement being made.  Although I will have to be careful being I don't know my statement date at this time.  Isn't this correct?  I won't have a due date until the statement is sent and tells me the due date. By that time it will be paid.  Please tell me that made sense.

Message 8 of 19
Senior Contributor

Re: Just beginning with credit cards.. help please

Please read my answer to this question, if you didn't already read it 10 days ago Smiley Wink

 

http://ficoforums.myfico.com/t5/Credit-Cards/How-do-I-play-the-1-9-Utilization-Game-Please-Help/m-p/...





TU-8: 755 EX-8: 771 EQ-8: 763    EX-8 Bankcard: 815    
TU-9 Bankcard: 795 EQ-9: 822
   EX-98: 735 EQ-04: 730
Total $437,800
Message 9 of 19
New Visitor

Re: Just beginning with credit cards.. help please


Themanwhocan wrote:

Please read my answer to this question, if you didn't already read it 10 days ago Smiley Wink

 

http://ficoforums.myfico.com/t5/Credit-Cards/How-do-I-play-the-1-9-Utilization-Game-Please-Help/m-p/...


Very helpful!

Message 10 of 19