Hi all,
This is my first post and I'm a short time lurker on these forums. I'd like some advice and guidance on how to rebuild my credit.
My Bankruptcy (Chapter 7) is finalized May 2014. I was told by my lawyer to start rebuilding ASAP and to get a secured Capital One and Secured Bank of America card.
I applied for both and was denied by BoA and told my score was a 538. I was approved for a $200 secured with Capital One for a $49 deposit. I've made my deposit and should get the card before the 1st of July. I've read online a few strategies on how to build my credit but they all seem to be keep the utilization around 29% on the reporting date and pay it off by the due date to make sure you don't carry a balance. I can see myself going down a few different paths. I'll try to make it as clear as possible, but please ask questions if it doesn't make sense. I appreciate any help.
Use the capital one credit score tool to make sure that everything has fallen off my report.
How do I use the Capital One Secured card?
1. Keep the $200 credit limit and only put on their $50 a month and pay it off by the due date.
2. Deposit money for an $800 credit limit and put my monthly bills that I have cash for on it. Make sure it shows 20%-29% on the reporting date and pay the balance off so I'm not charged interest.
^
I'm not sure which one would give me a better standing with capital one or with my credit score in general. Is there a better way to do it? My thought is that if I do the $800 when I go to apply for an unsecured card in the future that's my min approval limit.
6 month mark:
I figure after 6 months of the capital one card in good standing I should apply for
1. A unsecured capital one quicksilver card (or another one)
2. Bank of America secured card - This card converts after 12 months so I'm pro this card in general.
11 month mark:
With both cards in good standing I figure if I do the secured bank of America card I should apply for the unsecured card at this point.
Once I have 2 working cards I thought I should close the capital one secured card.
Any tips or guidance or corrections would be most helpful. It's a little late right now so I hope this is as readable as I meant it to be!
Thanks for that ntx. I've already read it. I've tried applying as suggested and decided to go the secured route instead. Does anybody else have input to my other questions?