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11-04-2012 01:49 AM - edited 11-04-2012 02:03 AM
Just starting out with establishing credit. Nothing on file except for the INQs for the two CC's I got ( both secured ). Activated them today and plan to put a static recurring charge on each of them and pay it in full each month.
I think I read 6 months somewhere but wasn't sure if that timeframe was a mandatory minimum or not.
If I do this for 6 months and don't mess up ( I won't, I have essentially automated the process ) what can i expect my scores to start out at?
We were looking to purchase a new(er) vehicle as soon as possible and our CU rep mentioned that they pull Beacon scores exclusively. I think 680 was their breakpoint for 2nd tier rates which would put us in around 3%, top tier rates is too far out for it to be a reasonable goal for us since we will have had to purchase something long before we would get there ( mid 700's )
Is 680 starting out too unreasonable? I just don't want to plan and budget for something that isn't within the realm of possibility.
Also, I have read up a lot about ping ponging a sub 9% util rate between the cards to maximize my gains but didn't want to hassle myself with it if it was only going to save me a statement cycle worth of waiting or a few points in the long run. Is this something definitely worth doing?
And just for clarification, The 680 baseline is also the breakpoint at which the inhouse CU manager can make lending calls without sending them to a senior loan officer who is going to number crunch, look at my limited history and then decline me.
I would very much like to have someone I know on a first name basis ( small town, pop. of about 900 people ) making that call which is why getting to the arbitrary figure of 680 is so important.
11-04-2012 05:20 AM
The minimum scoring requirement for a FICO is that you have a credit account opened for 6 months, and that it must not be disputed. You also can't be an AU on any deceased user's account. Your CR will show an open date of the first for your new account. So, if you applied late last month, you might technically have a 2-month old account with an open date of 10/1. So, on March 1, you would have a FICO.
It's tough to predict a starting score. Depends on what happens between now and then, util on the card at that time, and what is reporting now. You specifically mentioned the word "Beacon". That's the FICO version for Equifax. Pull EQ from time to time between now and then just to make sure it remains clean. I suppose a 680 is possible on a perfectly clean report with a balance on the CC of under 9% of the CL, with nothing else reporting.
11-04-2012 08:24 AM
It's hard to say where your FICO score will start out, as Llecs said. However, I work with a lot of young Sailors who *presumably* have short histories and it's not uncommon to see scores in the low 700s. However, I say *presumably* because I have no idea what's in their files. Perhaps a parent had added them as an AU on a card when they turne 18, giving them years of history right off the bat. Also, given their age, its possible that they have 2 years of history, which is significantly more than 6 months. It seems completely possible that you'll start out around 680.
As far as manipulating your util percentage, it may be too complicated for you to worry about, since it sounds like you have an excellent plan for automating everything. I would caution that you should make sure whatever you have automtically running through those cards is less than 10% of your credit limit --- which can be difficult with small CL. If you're charging more than 9% of your CL thru the card each month, you'll want to make a payment BEFORE the statment date date (which is typically when ccc's report your balance to the CRAs).
The only other thing that I can think of to do to start out with the highest score possible, is a month before you plan on applying for the car loan, is to pay the balance on one of the cards to $0 before the statement date (and let the other report >9%), as FICO seems to factor in the number of cards with a balance as well. Most say their score takes a slight dip if they let all cards report $0, but one card at 1-9% and the others at $0 seems to get people the most points.
11-04-2012 09:06 AM
11-04-2012 09:40 AM
No, using each card once a month is more than enough to keep it closing due to inactivty. You won't have to worry about that.