Need a little advice

[Meanmchine]

Maybe next time youll ask a question rather then ASSUME

[austinguy907]

So, the by your suggestion they  lack income and are full time students with a special needs child living in your den with mama bear?

Still doesn't mean that he should be picking up a CC if he doesn't have an income that can be verified if they decide to audit him prior to opening.  This is known as Fraud....

Firing back with an attitude in response to solid advice instead of filling in the space between the lines is absurd.  Maybe mama bear needs a valium and a bourbon before hopping online?

Being proud and conducing fraud are two different things though.  Understandably you're just trying to help because you're being protective which is what parents do.  The way things are interpreted though is based on the information supplied.  

Take it with a grain of salt then and move onto whatever you and yours are going to do and have a nice day!

[Meanmchine]

"Still doesn't mean that he should be picking up a CC if he doesn't have an income that can be verified if they decide to audit him prior to opening.  This is known as Fraud.."

I never said they have zero income. He correctly listed his current income on his application.  Fraud?  I think not. 

Also there are many reasons for wanting to improve your credit profile that dont have to do with credit cards.  You need a fico score for insurance. You need  fico score for apartment rentals. You need a fico for employment. Do I need to list more?  You need it to open a checking account with a credit union.

[austinguy907]

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@Meanmchine wrote:

Also there are many reasons for wanting to improve your credit profile that dont have to do with credit cards.  You need a fico score for insurance. You need  fico score for apartment rentals. You need a fico for employment. Do I need to list more?  You need it to open a checking account with a credit union.

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Now that things have calmed down a bit and we can be rational about things.  Yes you need a credit score for those things too.  Considering though we're under "Credit Cards" though we're more focused on CC and how to obtain / maintain them.  More importantly when it comes to APT's you need 3X the income of the rent besides the credit score, the score comes more into play with how much of a deposit typically will be needed when signing the lease.  Employment / Insurance are a bit more subjective than objective when looking at someones credit.  No matter what I've done with my credit it doesn't seem to make much of a difference if I'm 600 or 830 when it comes to insurance.  Not every employer needs to pull credit and prefer not to when it comes to compliance with FCRA requirements that would be needed to ensure they don't leak information either through employees or their data network in the office.  As for the checking account the higher score is so you can get a debit card with your checking account without having to do a "fresh start" program of sorts and wait 6-12 months to be upgraded from an ATM only card.

Back to your Daughter / Son in law / Child......

So, it sounds a bit sticky considering everyone came home to save and go back to school for a better future down the road.  School is time consuming and debt accumulates considerably without grants / gifts.  Defaulting on the smaller bills is the biggest thorn when it comes to his score though.  If time is spent on fixing those first the whole secured card issue goes away and he'll qualify for a regular card without securing/co-signing/joint applying.  So, without knowing his income it's hard to say which direction to go from here.  

Is helping them out something you feel more as mentoring from your experience in recovering your credit as well?  It seems like you had some issues as well that you've been working on looking the jump in your TU score.  It's a rough process to go through the events in our financial lives but, the thing to remember is not to get emotional about it since money doesn't have feelings and is purely math.  

Several financial "experts" say to put things into perspective of people first, then money, then things.  Others stick to the basics of KISS where as you don't try to juggle more things than you can manage.  Some here play the game of %'s of balances to limits and there's much simpler ways to do it like setting an artifical limit of 10% of your balance to spend up to and then auto pay in full each month instead of making multiple payments, paying before the statement cuts, or whatever whacky spreadsheet method is out there.  

Everyone wants to see people do well when it comes to life whether having a family, growing financially, experiencing new things, and so on.  The reason we come and post stuff here is because we're looking for insight someone might have from a previous experience or to help someone going through the same / similar experience we or someone we know are/have going/gone through.  

[Meanmchine]

/rant off

Yes I am a recovering deadbeat (no other way to explain it) Without going into the reasons, I made the decision to walk way from my obligations about 7 yeras ago. I had a choice to go bankrupt or not and I didnt opting to just move forward paying some of the bills and some, not. By the time spring traininng rolls along, I will have only 1 negative on my files and hopefully a 750+ score

There are several topics that young couples today ( and yesterday also lol ) do not understand or appreciate. One is retirement saving and the other is a solid financial portfolio.

Getting back to the OP, my advice had been to use the 2 accounts wisely (Fingerhut and Cap1)  and let them report to all 3 CRAs. I just wasnt sure if a PIF or monthly payments was the better avenue to take with credit virgins. My intent was never to load them up with cards or to get them a Lux card by christmas.

Feel free to attack me for my credit choices. Im a big boy, i can take it

[UncleB]

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@Meanmchine wrote:

/rant off

Yes I am a recovering deadbeat (no other way to explain it) Without going into the reasons, I made the decision to walk way from my obligations about 7 yeras ago. I had a choice to go bankrupt or not and I didnt opting to just move forward paying some of the bills and some, not. By the time spring traininng rolls along, I will have only 1 negative on my files and hopefullt a 750+ score

There are several topics that young couples today ( and yesterday also lol ) do not understand or appreciate. One is retirement saving and the other is a solid financial portfolio.

Getting back to the OP, my advice had been to use the 2 accounts wisely (Fingerhut and Cap1)  and let them report to all 3 CRAs. I just wasnt sure if a PIF or monthly payments was the better avenue to take with credit virgins. My intent was never to load them up with cards or to get them a Lux card by christmas.

Feel free to attack me for my credit choices. Im a big boy, i can take it

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I don't want to get too far away from your original topic (helping your son-in-law) but I do feel compelled to say that nobody here should judge you... actually if folks feel the need to start throwing rocks, I'll have to stand right next to you myself.

Sometimes in life we have to make hard decisions; I've made a few myself that I'm not proud of, but I learned from them and I've moved forward just as you have.  Like you, I have chosen to use what I learned to make sure (God willing) that I never end up in that situation again, and to help others when they ask for it.  Like you say, people are free to think whatever they want about my past (some of which might be justified) but I can't do anything about that.  I choose to focus on what I can do something about. 

Back to your OP, I think your plan is a good one, and will help your SIL get back on track.  If only someone had been there like that to give me advice a few years back things could have turned out very different...

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I'll take this opportunity to remind everybody that we do have an FSR rule on the forum, so while discussion, debate, and even dissent is both healthy and encouraged be sure you don't cross the line.  People post here to get advice and to help others, not to be judged or have their circumstances picked apart by a mob. 

[austinguy907]

By no means am I calling you a deadbeat.  Making progress is healthy and feels good when you accomplish something significant like recovering from defeat.  Millenials don't have the same focus as say Gen X and growing up under Reagan guidelines.  I've been in both ends of the spectrum and have learned alot from it over the years.  From being young and dumb rakcing up CC's and collections like it's XMAS to the lowest of BK7 to recovering to a solid financial achievement and scores over 800.

That being said I may have jumped the gun with some responses but, with the limited information at the time forced to draw a conclusion with the parameters given.  As for millenials and finances it's a clusterf#$% sometimes trying to take the hood off their head and show them the way.  

As to the OP..... knowing what we know now about each other as limited as it may be.... 

Fingerhut is a foot in the door to making some payment history and rebuilding.  I'm not sure how well this will factor into his reports if it will show up as a regular revolving tradleine or as a finance account.  It sounds like when it converts to the other type of account they offer it should push it into the realm of revolving which will score better.

Secured card like I said earlier might be averted entirely by paying off the collections should also have a positive effect on his score.  Of course the biggest factor as you know with your goal of 750+ is TIME.  Once having these 2 accounts open for a year or two if the collections remain at bay there should be enough history generated to counter the effects of the point loss.  Depending on how things progress and if he abstains from getting several new accounts in the same time his scores will probably be 660-690 and possibly higher as the BOA / Fingerhut graduate and increase their limits.

One of the detriments of the Fingerhut account is that it's a captive account thay can't be used somewhere else to generate activity and they typically charge quite a bit more for the same products you can pick up somewhere else.  The initial installment loan will probably be scored more as a financing account and then the conversion will boost points with revolving classification.  

I would consider if funds permit it going with a Discover Secured instead of / in additon to BOA since you have a bit more control of the amount you can place into the account.  Plus it will grow as time goes on once it graduates to unsecured.

https://www.discover.com/credit-cards/secured/

[Anonymous]

Some of this information may have already been suggested. I honestly skipped most of the thread when I saw the back and forth. Just some things to consider.

Added him or her as AU may or may not be a good idea. It doesn't look like your or him have a clean profile. So the benefits he would get are minimal. If the account you are considering adding him to is an older account that may help some. Being an AU doesn't get you in the door with any creditor, could hurt your utilization depending on the balance the account carrier and if he is considering Chase will go against the 5/24. Unless you are pushing his AAoA 3 years + I don't see the point.

IMO adding someone as AU should be on clean young files only in the sense of credit building. 

As for Fingerhut, I think that depends on if he or his wife shops there. As a rule of thumb, you should only apply for cards that meet you spending patterns. There are plenty of secured card options out there that unsecure and grow. 

I also wouldn't carry a balance to grow rapport with any creditor. Most don't care unless it is like Barclays and for the ones that don't I wouldn't do business with. There are cheaper read free options out there to build your credit and not waste it on finance/interest charges.

[UncleB]

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@Anonymous wrote:

Some of this information may have already been suggested. I honestly skipped most of the thread when I saw the back and forth. Just some things to consider.

Added him or her as AU may or may not be a good idea. It doesn't look like your or him have a clean profile. So the benefits he would get are minimal. If the account you are considering adding him to is an older account that may help some. Being an AU doesn't get you in the door with any creditor, could hurt your utilization depending on the balance the account carrier and if he is considering Chase will go against the 5/24. Unless you are pushing his AAoA 3 years + I don't see the point.

IMO adding someone as AU should be on clean young files only in the sense of credit building. 

As for Fingerhut, I think that depends on if he or his wife shops there. As a rule of thumb, you should only apply for cards that meet you spending patterns. There are plenty of secured card options out there that unsecure and grow. 

I also wouldn't carry a balance to grow rapport with any creditor. Most don't care unless it is like Barclays and for the ones that don't I wouldn't do business with. There are cheaper read free options out there to build your credit and not waste it on finance/interest charges.

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Some good points here, however I want to clarify that the OPs profile is of no consequence to the son-in-law as long as the card he's offering for AU purposes has a clean history.  As long as the AU card has a positive history the benefits would be the same to the SIL regarless of the OP's past issues.

To someone with a brand-new file (new for whatever reason) being added as an AU can have a major impact to FICO scoring, which is the goal in this case.  I don't think the SIL will be in the market for mainline Chase cards for a while, so 5/24 rightfully isn't a concern.  What the SIL needs is to get a few positive accounts reporting to build his score; once his score is higher then he can work on his next plans.

The OP is taking the right action.