Prime credit cards versus sub-prime credit cards?

[Anonymous]

Does whether or not a card is prime or sub-prime impact Fico scores? How do issuing banks view them? Good, bad, or indifferent? What cards are considered prime? Chase, and Amex come to mind, although I wonder about the latter since they just approved me.  Is Discover considered prime? Which cards are considered sub-prime? I'm pretty sure my Juniper, (Barclays), is considered sub-prime, since they gave it to me back when my credit was in the toilet. Maybe my QS1 also, since it started as Orchard Bank.

What are your thoughts?

[longtimelurker]

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@Anonymous wrote:

Does whether or not a card is prime or sub-prime impact Fico scores? How do issuing banks view them? Good, bad, or indifferent? What cards are considered prime? Chase, and Amex come to mind, although I wonder about the latter since they just approved me.  Is Discover considered prime? Which cards are considered sub-prime? I'm pretty sure my Juniper, (Barclays), is considered sub-prime, since they gave it to me back when my credit was in the toilet. Maybe my QS1 also, since it started as Orchard Bank.

What are your thoughts?

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Generally. banks offer a range of cards: if the lower end of the range can be obtained with subprime credit, you can call that a subprime card.   A lot of people here apply "prine/subprime" to banks as a whole, but I don't think that is very useful, except for the handful of banks, such as FP, ALL of whose cards are aimed at the subprime market.

[kdm31091]

For FICO purposes, it does not seem to matter. A credit line is a credit line. Your utilization is your utilization. The FICO score does not care who the credit line came from.

The sub-prime/prime thing is more of a status thing than anything. AMEX, Chase, etc are looked on as higher end, premium lenders, because of their higher end benefits for their cards. Capital One is one of the ones called subprime because the benefits are not as rich typically. However, if you are just looking for credit and some rewards, and not doing travel transfers or things like that, honestly the benefits for most rewards cards are relatively similar - either 1, 1.5, or 2% cash/points back, except bonus categories.

However, excluding the benefits of various rewards, your score doesn't care if your $5000 credit line is from Capital One or if it's from Amex. The benefit for your scoring will be the same.

Some of the "prime" lenders are still often debated around here -- some people hate BOA, even Chase, Citi, etc, had bad experiences, no CLI's, high APR forever, etc etc, No one lender fits everyone. Everyone has a lender that they don't like, even in the prime category.

In short don't make a decision based on the subprime/prime thing. Now, there are some subprime lenders that most recommend avoiding unless you are a serious rebuilder - Credit One, for example, with outrageous fees and little to no rewards. But enough reading of their T&C before applying would show you how bad they really are. However, some of the super subprime rebuilder cards still have their place if your score is really in the toilet.

[Anonymous]

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@kdm31091 wrote:

For FICO purposes, it does not seem to matter. A credit line is a credit line. Your utilization is your utilization. The FICO score does not care who the credit line came from.

This is true but on manual review lenders definitely view subprime credit cards and loans as a negative

[kdm31091]

Depends how subprime, really. If you are talking about things like payday loans and stuff, it's a negative.

A Credit One credit card account in good standing I don't think could be considered negative, but maybe I'm wrong. It's still a positive credit account.

[CreditCuriosity]

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@Anonymous wrote:

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@kdm31091 wrote:

For FICO purposes, it does not seem to matter. A credit line is a credit line. Your utilization is your utilization. The FICO score does not care who the credit line came from.

This is true but on manual review lenders definitely view subprime credit cards and loans as a negative

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Wish I could be a fly on a wall in Chase/Citi/Barclay's U/W department for a day...  Hear what people say on recons and decisions and the stuff they talk about between themseves about x person etc

[Anonymous]

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@kdm31091 wrote:

Depends how subprime, really. If you are talking about things like payday loans and stuff, it's a negative.

A Credit One credit card account in good standing I don't think could be considered negative, but maybe I'm wrong. It's still a positive credit account.

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But because the credit lines are quite limited in size. It would be considered a negative when it comes to manual review. A small negative is still a negative.

[Anonymous]

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@CreditCuriousity wrote:

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@Anonymous wrote:

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@kdm31091 wrote:

For FICO purposes, it does not seem to matter. A credit line is a credit line. Your utilization is your utilization. The FICO score does not care who the credit line came from.

This is true but on manual review lenders definitely view subprime credit cards and loans as a negative

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Wish I could be a fly on a wall in Chase/Citi/Barclay's U/W department for a day...  Hear what people say on recons and decisions and the stuff they talk about between themseves about x person etc

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It wouldn't shock me if some of them frequent these forums.

[Anonymous]

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@Anonymous wrote:

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@CreditCuriousity wrote:

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@Anonymous wrote:

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@kdm31091 wrote:

For FICO purposes, it does not seem to matter. A credit line is a credit line. Your utilization is your utilization. The FICO score does not care who the credit line came from.

This is true but on manual review lenders definitely view subprime credit cards and loans as a negative

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Wish I could be a fly on a wall in Chase/Citi/Barclay's U/W department for a day...  Hear what people say on recons and decisions and the stuff they talk about between themseves about x person etc

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It wouldn't shock me if some of them frequent these forums.

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Sometimes, I think they do! You've read in some of the posts where an analyst suggests someone come to this site.

[CreditCuriosity]

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@Anonymous wrote:

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@CreditCuriousity wrote:

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@Anonymous wrote:

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@kdm31091 wrote:

For FICO purposes, it does not seem to matter. A credit line is a credit line. Your utilization is your utilization. The FICO score does not care who the credit line came from.

This is true but on manual review lenders definitely view subprime credit cards and loans as a negative

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Wish I could be a fly on a wall in Chase/Citi/Barclay's U/W department for a day...  Hear what people say on recons and decisions and the stuff they talk about between themseves about x person etc

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It wouldn't shock me if some of them frequent these forums.

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Oh sure some people on the forum are UW/Analyst or have just checked to see what the MyFico forum is all about as I have spoke to Uw/Analyst at chase about myfico and they are well aware of this forum or at least some of them are and refer me here... looking at you Ritz recon analyst