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Secured card .... when is enough ...enough?

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New Contributor

Secured card .... when is enough ...enough?

I'm just wondering if anyone could give me some advice. I'm rebuilding my credit and have managed to get 3 other unsecured cards with decent limits since I'm in the rebuilding stage. I was thinking about getting BofA secured card. Would that be a good idea or should I just focus on nuturing my accounts with Penfed, Cap1 and Amex. I still have a creditone card. Is it time to do away with secured cards?

If you've had secured cards, at what point did you get rid of them?
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Message 1 of 13
12 REPLIES
Valued Contributor

Re: Secured card .... when is enough ...enough?

Little confused with your post

1) If you have 3 unsecured TLs ( + it sounds like at least 1 additional secured CC TL) then the answer is NO... there is no need to secure yet another TL, you have plenty.
You just need to manage what you have ( maybe better) to get the scores up to where you desire.

2) As to when, one gets 'rid' of secured cards...
It depends
A) Most cards graduate within 6-18 months so it generally just becomes just another account ( there are a few exceptions)
B) Most ppl would have well established other TLs prior to disposing of any leftover secured CC, again generally unlikely because most unsecure

*Something is off or you're way too early or have management issues if securing yet another CC via deposit is even an option being considered...

With the line up of unsecured cards listed, I'd be very comfortable dumping CreditOne ( of course I'm not a fan of Credit 1 at all) but not to add another secured card.... keep the utilization ratio low and payments up over time and all will be well... let the current stuff age together and you're golden👍
Message 2 of 13
Contributor

Re: Secured card .... when is enough ...enough?

Seems like you are on the right path. I've not seen any data that proves 4+ cards have any advantage over 3 for credit building. The Credit One is a personal choice. Only you know if it's needed for AAoA or utilization padding. If neither, I suggest getting rid of the annual fee and concentrate on the three you have.

Instead of securing another card have you considered an Alliant SSL? May be something to look into if you don't already have an installment loan. Three plus revolving accounts and one installment is usually referred to as the 3+1 method and is considered as pretty close to optimal for rebuilding.
Message 3 of 13
New Contributor

Re: Secured card .... when is enough ...enough?

@gemini191 thank you. I recently just acquired the 3 new unsecured TLs. The creditone acct I've had for about 5 years. I'm not have management issues but I wasn't sure if I should still be looking at secured cards since my score are in the low 600s
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Message 4 of 13
New Contributor

Re: Secured card .... when is enough ...enough?

I'm new to the credit world I just joined penfed and have the Cc with 5k limit. I'm still have an auto loan with Cap1 with 5400 left to pay I want to get that taken care of before I get any additional SSL. Definitely okay with what I have but I'm itching for a new card😔
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Message 5 of 13
Valued Contributor

Re: Secured card .... when is enough ...enough?

1) Forgive me, I didn't mean to offend you regarding my management issues comment 😎

My point was there has to be a sticking point for non score growth but you've now provided a bit more of the 'why'
No biggie, your cards are young so simply letting them age will work itself out to your favor.

In fairness, even with just the one CC ( of 5 years) coupled with the one install account one could absolutely grow a score above the 'low 600s' .. generally negs or management are the only reasons for a suppressed score...sure the new recently approvals cost a few points but not many

Also you don't need a SSL you have an auto loan, it trumps the value of 'creating' an installer with a SSL

Again, by saying the auto has $5400 'left' it indicates it has some age to it + a 5 y.o. CC account is plenty to grow a score past low 600's unless something is pulling the profile down... lates, utilization etc all = management.

I'm sure everyone will have different definitions of how long one should be classified as 'in rebuilding' but IMO after 4-5 years something needs tweaking because that's too long of a sentence for one to serve.

Itching for another CC with low 600 scores IMO is NOT what I'd want to hear from a secured card candidate that just got a 5k CC...just being honest, sounds dangerous be careful ☺
Message 6 of 13
New Contributor

Re: Secured card .... when is enough ...enough?

lol No offense taken.Smiley Very Happy

My UL is very high because im at my limit and and always carry a balance. I am just realizing that I should have been PIF and not using so much of my limit. I do have quite have about 4-5 inquiries too. I just cant seem to get more towards the 700 range. I really want that to be my year end goal. Do you think its achievable?

 

Im only itching for a new card because prior to the last few months I hadnt applied for anything in 2-3 years. I know that I need to stay in the garden though but the anxiety is killing me Smiley Sad

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Message 7 of 13
Valued Contributor

Re: Secured card .... when is enough ...enough?

1) Well we only have a few more reporting cycles, prior to year's end but within a few months ABSOLUTELY you have a shot at 700 by early 2018

2) Again, as mentioned you have more control than you realize based upon how you MANAGE your TL

I didn't want to TELL you, I 'knew' that your balances had to be high and carried because it'd come across as jerkish but we're friends now and you've come clean and said so yourself 😊 again as I said no biggie I've being in F&I working with folks near 25 years = no judgement...it's about solutions, what can "we" do Next

Here's the deal, you will NOT be able to allow maxed out utilization rates to report AND have score growth...it just will NOT work.

We sometimes forget that the scoring model us a 'dumb' computer program, no emotion it just crunches the 'facts' as fed to it and high utilization = RISK

And Risk = lower score...ying to yang...fish to water

If you get the utilization ratio down the reverse happens w/o emotion...the score can't help but to go up...it's just the way the program/ model/app or whatever you kids today want to refer to it as is written to respond.

The 'trick' to holding balances and 'using' credit for debt is to WAIT until you've allowed it to GROW UP out of a rebuilding or initial building stage

In other words a up n coming Freshman/Sophomore can NOT hold balances and max out cards as the pay down debt because it effects and suppresses the growth they NEED... whereas an established profile already has enough juice to sustain such activity.

And a more established player understands when to app and when not to based upon the debt ratios their housing at the moment...
Too many ppl stub their own to because they haven't learned how to manage or 'play' the game from where THEY stand at the moment...things change and how one is allowed to play changes but dues must be paid.

If you simply discipline yourself to keep the reported debt LOW your scores would rocket
Play around with blasting your usage AFTER reporting days not before...pay the bulk of the debt PRIOR to allowing a Statement balance of crazy high debt to report.

Time and Time again a person comes complaining about how they pay the entire bill every month but their score sucks...
I say detail person says I charge $900 vs my $1000 CL but I pay it the DAY it comes out
I say change WHEN you pay, it's not that you charged $900 or you paid 'on-time' it's that the $900 "looks" bad
Let's change WHEN you pay to say $810 before the statement cut allowing only $90 vs the $1000CL to report as debt, then once the reporting happens you can slap $810 back on just remember to manage how much reports on what day based upon when the credit sends in the picture on the once a month picture day

Your hair can be messy tomorrow just not on picture day...manage to look good on picture days and your score will grow
And once it's grown up, you'll get more leeway
Best of luck
Message 8 of 13
New Contributor

Re: Secured card .... when is enough ...enough?

Aw I'm so thankful you took the time to give me your input. You could be my financial dad lol.

 

its funny you mention change when you pay because this has to be where i go wrong. I do make multiple payments throughout the cycle but my bal isn't low a few days before the statement cut. I have to change this ASAP this is exactly why paying multiple times throughout the cycle hasn't helped me. Rats!! 

 

I vow vow to make these changes because I really want to get my score up by my birthday. It's a gift I'm giving to myself plus I'd like to purchase property sometime next year.

 

THANK YOU!!!🤗

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Message 9 of 13
New Contributor

Re: Secured card .... when is enough ...enough?

Aw I'm so thankful you took the time to give me your input. You could be my financial dad lol.

 

its funny you mention change when you pay because this has to be where i go wrong. I do make multiple payments throughout the cycle but my bal isn't low a few days before the statement cut. I have to change this ASAP this is exactly why paying multiple times throughout the cycle hasn't helped me. Rats!! 

 

I vow vow to make these changes because I really want to get my score up by my birthday. It's a gift I'm giving to myself plus I'd like to purchase property sometime next year.

 

THANK YOU!!!

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Message 10 of 13