12-01-2010 11:22 AM
Hello, I'm in the process of rebuilding my credit and thanks to myfico.com, I have made a lot of progress as my credit score is now 650. Most of the bad stuff on all 3 reports were unpaid collections, late payments on 2 retail store cards that were eventually closed and 2 judgements but thankfully all have been paid and some accounts have actually been deleted frome all 3 of my reports (I wrote tons of GW letters). Now I seem to be stuck with this score and I'm trying to figure out how to raise it. My husband and I have 1 US Bank credit card with a $500 credit limit and I've requested an increase but unfortunately due to my score, the bank will not increase my limit. My husband and I would like to purchase a home this year and a mortgage broker told us that if I open up another credit card with a higher limit, use it monthly and pay off the total balance each month, my score will increase. Is this true and if so what would be the best credit card to go with? I receive credit card offers every single day in the mail with huge interest rates, should I go with one of those banks?
12-01-2010 12:51 PM
Personally, I would wait before trying to open another CC. The hard inq will drop your score like a rock. Are you carrying a balance on your current card? You'll want it to show less than 10% utilization on your CRs. Also, try and get anything collection related completely deleted. We just did that with DH...the last paid collection was removed about a week ago and his scores finally broke the 700 mark! Now we just have to work on paying down the balances on our CCs...his current util is 82%.
12-01-2010 02:32 PM
I agree that it would be wise to keep on with the clean-up first.
But for mortgage purposes, you might well need to have an additional card. The scoring formula "likes" to see 2-3 open revolving accounts. Also, I think (?) mortgage lenders want to see 3 open accounts (of any sort) reporting for the most recent 12 months.
I'm not a fan of vulture cards, but APR doesn't matter if you PIF (pay in full) every month, as you should certainly be doing. For a better alternative, I'd suggest visiting local credit unions and asking if they offer secured cards. Secured cards score the same as unsecured, and CU's almost always treat their customers way better than do banks.
OP, if you're trying to find out where to get a card, this post would probably do better over in Credit Cards, although you're certainly welcome to leave it here. If you want to have it moved, click Options above on the right of any of the posts. Select Report inappropriate comment, and a text box will pop up. It isn't inappropriate, of course, but that's your opportunity to request that your thread be moved.
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12-04-2010 12:14 PM - edited 12-04-2010 12:14 PM
I think getting a secured card with a larger limit is a good option. US Bank has several, some are cobranded with rewards. Other Banks and CU also have secured cards with good terms. Of course, it will tie up your money , usually for a year or more,which is past your Mortgage Objective.
Who are you getting offers from? Some would be considered good, even with high APR.
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