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usaa secured card to rebuild credit

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Anonymous
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usaa secured card to rebuild credit

Hello everyone,

 

I have made some poor decisons in my past about not paying student loans and one credit card on time.  This has put me in a situation where i am rebuilding credit now that i am significantly more financially responsible.  I have gotten the usaa secured cd card to start rebuilding and have been following the rules with credit utilization (keeping it under 20%) and paying it off every month.  Everything has been going well with the card so far.  My concern is when the 2 year cd period with the card is up what should i expect.  When i asked usaa on the phone about this they said that i would just get approved for a better line of credit without the need for a deposit after the 2 years.  From my understanding it is bad to close accounts and that it could negatively effect my credit.  Is this something i should be concerned with or will it not show poorly on my credit report after the 2 years?  Thank you for your help 

Message 1 of 4
3 REPLIES 3
Anonymous
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Re: usaa secured card to rebuild credit


@Anonymous wrote:

Hello everyone,

 

I have made some poor decisons in my past about not paying student loans and one credit card on time.  This has put me in a situation where i am rebuilding credit now that i am significantly more financially responsible.  I have gotten the usaa secured cd card to start rebuilding and have been following the rules with credit utilization (keeping it under 20%) and paying it off every month.  Everything has been going well with the card so far.  My concern is when the 2 year cd period with the card is up what should i expect.  When i asked usaa on the phone about this they said that i would just get approved for a better line of credit without the need for a deposit after the 2 years.  From my understanding it is bad to close accounts and that it could negatively effect my credit.  Is this something i should be concerned with or will it not show poorly on my credit report after the 2 years?  Thank you for your help 


Thats not the "rules" for utilization. The recommeded "rules" is to use it as much as you want to, make multiple payments throughout the month, and before the statement closes, pay all but a few dollars of the balance.

 

Register for online account management so you can make all your payments online, and don't rely on the US Mail.

 

Closing an account is not bad by itself. If it's your only account it's bad, if it's got a high limit and other accounts are low limits with balances it could be bad.. But other than that, no its not bad. Secured counts are not meant to be permanent accounts, you close them once you are able to get unsecured accounts.

Message 2 of 4
Anonymous
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Re: usaa secured card to rebuild credit

Their secured doesn't graduate. Their classic might. It does for some and not for others.

 

once your score has risen, and with a little research, say 3-6 months, find an unsecured card that works for you and your spending habits. That way, in 2 yrs time, when you decide to close the secured and either roll your cd into another cd, invest or cash out, the advent of another unsecured only costs your reports a loss of 3-6 months of an older open trade line AND you have a positive closed account. 

 

My opinion. 

 

I see having 4 cards right now as 1 with 3 backup plans.  3 lenders total. Interviewing for card number 5 in next 2 yrs myself.

Message 3 of 4
Anonymous
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Re: usaa secured card to rebuild credit

You also have the option of just letting it ride.

 

I have a secured CC for 250 with USAA and I am not quite ready to app for a regular card, waiting for another baddie to roll off.

 

I have had the card for about 4 years and it just  'auto renews' with no action from me.

 

I am sure I could qualify for a regular CC with them now, but I would like to app without the baddie showing.

 

hth

 

 

 

 

 

Message 4 of 4
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