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Regular Contributor
sbeasl11
Posts: 122
Registered: ‎07-23-2012
0

Skipping sub-prime cards...It can be done

So I was really worried when starting this rebuilding journey a few months ago. DH & I both had charge offs (paid) from Cap1 & HSBC. These are top picks for sub-prime. I didn't know how we were going to rebuild & avoid these giants.

I applied for BofA secured. Was initally denied, but thanks to this place, I called for recon and discovered a mistake on my report. BofA approved me so I have a $500 secured cc now. Today, we got hubby approved for a USAA secured card $500. Now we both have credit cards to build a history.

 

Should be able to get with NFCU in about 3 months...maybe that's where we'll get our home loan next year....*fingers crossed*

Valued Contributor
jamesdwi
Posts: 1,524
Registered: ‎09-16-2011
0

Re: Skipping sub-prime cards...It can be done

well you used a sub-prime product just via prime bank... the secure card was equivalent to a subprime card and you had to pay for it.

 

but good job anyway.

 

 


Cards: Chase Southwest 20k & CSP 10k & Amtrak 4.6k, & Freedom 3.3k & Slate 3.3k, FNBO DISC 14.9k Oregon Duck 5k, & AMEX BCP 15k & AMEX Hilton Surpass 7.5k & AMEX Zync NPSL, Sams Club Discover 10k, Paypal Extras MC 6k, CapOne 2.5k, CapOne 750, Amazon 3.9k, Walmart 4.5k, Citi Simplicity 7k, HHonors Gold 1k (moved 5k CL to Simplicity), Discover IT 6.5k and a nice stack of store cards.
Last APP 4/26//2014 no plans for new credit I think I have enough.
Established Contributor
distantarray
Posts: 2,112
Registered: ‎09-25-2011
0

Re: Skipping sub-prime cards...It can be done

pretty much Bank of America is a Subprime bank anyways, Who in their right mind would ever even THINK about declining a person for a secured card..... There is 0 loss potential with everything to gain. Keep the deposit and if there is excess fees added above and beyond which bank of america loves to do they can charge off the account and sell it to a collections agency or jdb.


total credit limits $108,400 Credit scores Ex 728 EQ 738 TU 758
Regular Contributor
XxRaVeNxX
Posts: 201
Registered: ‎08-19-2012
0

Re: Skipping sub-prime cards...It can be done

[ Edited ]

There's nothing prime about paying for a credit card, esp. if you had to recon a secured card....

 

But, I'd go ahead for for NFCU....

Chase Southwest $5000 - November 2012 Wal Mart $1000 - November 2012 NFCU Visa $5,000 - Sept 2012 NFCU NavCheck $3,000 - October 2012 Amazon $900 - Aug 2012 Kay's Jewlery $2700 - Aug 2012 Buckle $250 (Shopping cart trick) - October 2012 Roaman's $250 (Shopping cart trick) - October 2012 Capital One Secured $225 - April 2012 Capital One Platinum $2500 - July 2012
Frequent Contributor
OnTheRebound
Posts: 425
Registered: ‎08-05-2009
0

Re: Skipping sub-prime cards...It can be done

Well I can attest to the fact that it is possible to skip sub prime and go straight to prime.

 

After not having any credit for about 8 years and waiting for all my negatives to fall from my reports and two closed positive accounts still reporting, I started getting preappoved offers from CITI for the Platinum Select MC. At first I just fed them to the shredder. Then after receiving the fourth or fifth mailing, I decided to go for it. I was hesitant (I had to have a couple of quick beers) but I applied.

 

At best, I figured they would approve me for $500, if at all. I would be happy with that. I was shocked when I was instantly approved for $8.7K. Six months later I got a online instant CLI, with a soft pull, to $10K and six months after that went to $12K, where it sits today. I don't need any more.

 

About a week later, I applied for the Home Depot CC, also Citi, and was instantly approved for $500. After 6 months I requested a CLI of $1500 online. Was not instant but was approved the next day with a HP. This is the one card I wish they would auto CLI for me because I use it a lot. But I'm not expecting one anytime soon as my utilities is high (1500/2000 0% promotional bal).

 

Mine

 

Citi Platinum Select MC- $12K

Home Depot- $2K

 

Hers

 

Chase Freedom Visa- $11.014K

Amex BCP-$6K

PenFed Platinum Cash Rewards- $6K

Lowes- $10K

Care Credit- $5K

Mine- Citi Diamond Preferred WMC $12K / Comenity Total Rewards Visa $2.5K / Citi Home Depot $5K / DW's, I'm AU on most- Amex BCP $12K / Chase Freedom Visa $11014.00 / PenFed Platinum Rewards Visa Signature $6K / Citi Simplicity MC $4.4K / GE Lowes $10K / GE CareCredit $5K

"Four out of five voices in my head told me to "go for it". I went for it."
Moderator
Revelate
Posts: 8,865
Registered: ‎12-30-2011
0

Re: Skipping sub-prime cards...It can be done

[ Edited ]

OnTheRebound wrote:

Well I can attest to the fact that it is possible to skip sub prime and go straight to prime.

 


To be fair, it matters a great deal what positives you had, what your FICO score happened to be at the time, and what specifically the negatives were.

 

In general regarding this thread, everybody's credit journey is different, and what works for one may not work for anyone else. 

 

Also as a note on secured cards, there are certain red flags, such as open judgements levied against a consumer, that will cause many lenders to deny a secured card (as someone else may have the legal right to snatch that deposit).

Starting Score: EQ 561, TU 567, EX 599* (12/30/11, EX lender pull 12/29/11)
Current Score: EQ 04 679, EQ 8 708, TU 711, EX 702* (07/14/14, EX older)
Goal Score: 700 on EQ '04 (01/01/15)


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Frequent Contributor
OnTheRebound
Posts: 425
Registered: ‎08-05-2009
0

Re: Skipping sub-prime cards...It can be done


Revelate wrote:

OnTheRebound wrote:

Well I can attest to the fact that it is possible to skip sub prime and go straight to prime.

 


To be fair, it matters a great deal what positives you had, what your FICO score happened to be at the time, and what specifically the negatives were.

 

In general regarding this thread, everybody's credit journey is different, and what works for one may not work for anyone else. 

 

Also as a note on secured cards, there are certain red flags, such as open judgements levied against a consumer, that will cause many lenders to deny a secured card (as someone else may have the legal right to snatch that deposit).



Of course everyones situation is different. I was illustrating the point being, if one is patient and and cleans up their reports, whether by disputes, PFD or just let it happen on it's own, it is possible. Takes time but is very possible. But you are absolutely right, what worked for me may not work for you. Just stating my experience. My apologies for not inserting YMMVIf someone doesn't have the time or patience, then the subprime option is the way to go.

Mine- Citi Diamond Preferred WMC $12K / Comenity Total Rewards Visa $2.5K / Citi Home Depot $5K / DW's, I'm AU on most- Amex BCP $12K / Chase Freedom Visa $11014.00 / PenFed Platinum Rewards Visa Signature $6K / Citi Simplicity MC $4.4K / GE Lowes $10K / GE CareCredit $5K

"Four out of five voices in my head told me to "go for it". I went for it."
Moderator
Revelate
Posts: 8,865
Registered: ‎12-30-2011
0

Re: Skipping sub-prime cards...It can be done

[ Edited ]

That point wasn't specifically directed at you OnTheRebound, my apologies if I gave that impression.  I should've been more careful in the quoting / response.

 

Personally I advocate people approach rebuilding from both directions: cleaning up negatives but also establishing positives immediately too... which usually mandates either secured cards or unsecured rebuilder ones for the majority of people.  The only constant in FICO is that time passes, and as such, it doesn't make mathematical sense to "waste" that time while clearing negatives (which can take a while in some cases) by not getting good payment history re-established as quickly as possible.

 

To paraphrase a romantic movie I actually enjoyed (shocking): when you realize you want to improve your FICO for the rest of your life, you want the rest of your life to start as soon as possible.  Establishing positive tradelines is one of the first steps, though admittedly 10 years from now it won't matter, it might in the short / mid term.

 

Starting Score: EQ 561, TU 567, EX 599* (12/30/11, EX lender pull 12/29/11)
Current Score: EQ 04 679, EQ 8 708, TU 711, EX 702* (07/14/14, EX older)
Goal Score: 700 on EQ '04 (01/01/15)


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Valued Contributor
Dustink
Posts: 2,980
Registered: ‎10-02-2012
0

Re: Skipping sub-prime cards...It can be done

[ Edited ]

I never went the secured card route or the nasty fee based cards. I was a teen with no credit, but my bank gave me an unsecured card with no annual fee. The banker explained to underwriting that I am a good customer with a checking account kept in good standing. That was enough for them to approve me. Then after a year or so they gave me a Visa Signature card with great rewards and a generous limit.

 

My recommendation to somebody with bad or new credit is to build a relationship with a bank. It can help if they see decent account activity in your checking account. The banker can have some pull to get you initially approved. After that, it is up to you to demonstrate your ability to handle the card. Different strategies work for different people, but as a general guide. Keep your balances low when they are reported, pay in full every month, and contact your bank for a limit increase every 6 months.

 

When I got the first card, my goal was to show the bank that I had no problem paying the card no matter how much I charged. I maxed the card every few days and paid it in full shortly after. So each month I had significantly more charges than my actual limit. After having the card for 6 months, I called up the bank and asked for an increase. I told them I needed the limit to cover atleast my average monthly spend. They increased the limit by over 8 times the original limit. Then I cut back my spending and focused on utilization and presenting the best over all credit picture. I proceeded to apply for other cards, and soon had a few other good ones.

 

This is the path I took. Just because it worked for me, does not mean it will work for you. It also creates a thin file and rapid expansion on credit limits will scare off some lenders. So, I wouldn't expect to qualify for a mortgage even with a FICO over 720.

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:21    


     $14k          $8.5K          $7.5k          $7.5k         $6.5k             $6k             $5k            $5k             $5k              $5k           NPSL       @ 0%
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FrugalRican
Posts: 2,876
Registered: ‎02-02-2012
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Re: Skipping sub-prime cards...It can be done


jamesdwi wrote:

well you used a sub-prime product just via prime bank... the secure card was equivalent to a subprime card and you had to pay for it.

 

but good job anyway.

 

 


What he said.

Follow my financial journey: http://www.frugalrican.com


EQ FICO (01/16/2012): 656 - EQ FICO (02/16/2012): 743 - EQ (02/24/2012): 760 - EX (04/28/2012): 739 - GOAL 2013: 800+

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