anyone used a "guaranteed credit merchandise card" to raise available credit?

[Anonymous]

One supposed little-known tactic to raise credit scores is to get and use a "guaranteed credit merchandise card" or "sub-prime merchandise card" to increase available credit without having an inquiry on your CR. I have seen these offers come in junk mail--an apparent "check" for several thousand dollars, but "spendable" only with a certain merchant. I always threw them away until browsing the Internet one day and discovering that they can allegedly raise CS if used properly (see for example, http://http://ezinearticles.com/?How-To-Improve-Your-Credit-Score&id=401100 ).

I just searched and found a source of one:
http://www.indigorising.com/credit-debt-solutions/merchandise-credit-card.htm
--"no credit check"--but it does say "small down payment required"--not sure how "small." Is this just a secured line of credit? Is it just a scam, or can it work to raise scores by raising available credit? Does anybody have experience with one of these? Does anyone know where to get one without the "small down payment"?

Message Edited by nature_lover on 01-21-2008 02:44 PM

[Junejer]

Nature, I have never heard of these companies. What do they do send you a check and if you cash it, voila, you have a line? Once you spend the check, you will use up your limit, then your uti is blown away. Also, how do they report loan type? Finance co.? Wouldn't be interested in that if that's the case.

Can they give a limit, say $2000, and then give you the option of using a portion of it, while reporting the $2000 CL? That might be worth it, depending on the fee.

Anyone else heard of this notion?

[Anonymous]

ByrdMan, the "checks" I've received in junk mail were not "cashable." You couldn't walk into a bank and deposit them in your account--they say "non negotiable" on them. The funds could be used, however, for merchandise from that merchant. To tell you the truth, I've paid very little attention to them and threw them away without studying how they worked, mainly because (1) I was annoyed at the sleazy tactic of making me think I had a "check" and (2) I wasn't interested in anything they were selling (cheap junk).

The links I give above do give more info. The one at indigorising says it reports to two CBs. According to the first link, they do report the total size of the "check" as a CL. Before I made a "down payment," though, I'd like to hear from anyone who might have used one to get a little feedback. I'm in more than enough debt for now, lol, unless it would pay off in a higher CS.

[Junejer]

---

@Anonymous wrote:
ByrdMan, the "checks" I've received in junk mail were not "cashable." You couldn't walk into a bank and deposit them in your account--they say "non negotiable" on them. The funds could be used, however, for merchandise from that merchant. To tell you the truth, I've paid very little attention to them and threw them away without studying how they worked, mainly because (1) I was annoyed at the sleazy tactic of making me think I had a "check" and (2) I wasn't interested in anything they were selling (cheap junk).

The links I give above do give more info. The one at indigorising says it reports to two CBs. According to the first link, they do report the total size of the "check" as a CL. Before I made a "down payment," though, I'd like to hear from anyone who might have used one to get a little feedback. I'm in more than enough debt for now, lol, unless it would pay off in a higher CS.

---

No, I figured that "cashing" the check was cashing it in on their merchandise. It just won't help you to have a maxxed out credit line out of the shoots. I would want to know if I could use, say, 10% of the line or do I need to use all of it right away.

I would also be interested in how something like this reports as loan type. If it reports as a finance company, then it might also be counter-productive and hurt your score.

[Anonymous]

I think you can use a fraction of it (see the ezine article above).
I guess I'm just going to wait and see if I get one of these in a junk mail offer and then investigate it further. I don't really trust the one in the second link I mentioned--I have enough credit/debt problems and don't need to actively stir up anything else.

[Junejer]

---

@Anonymous wrote:
I think you can use a fraction of it (see the ezine article above).
I guess I'm just going to wait and see if I get one of these in a junk mail offer and then investigate it further. I don't really trust the one in the second link I mentioned--I have enough credit/debt problems and don't need to actively stir up anything else.

---

I tried copy/paste with those links. The indigorising was kind of strange and it never let me go to the entire link...weird. I will try some more to find out more intel about this idea.

[Anonymous]

hey, I just noticed the URL I gave for indigorising is missing one letter at the end, it should end in html :
http://www.indigorising.com/credit-debt-solutions/merchandise-credit-card.html

Actually, reading it again, it says "Small down payment required to purchase most items until you demonstrate the ability to make timely monthly payments of 5% of balance owed. " This implies that, say, you ordered a $50 item--they might want $15 up front, something like that. It says no interest charges or annual fees.

[haulingthescoreup]

Wow, just about all of these sounds like nightmares waiting to happen! I would definitely Google them to death to see if anyone else has posted about them, and I would check with the BBB. And remember, with BBB, no news doesn't necessarily mean good news.

One huge concern I would have is how responsive they would be if there was a screw-up. Also, as ByrdMan said, there is a real question as to how these would report.

[Junejer]

Are these the unsolicited magazines that come to one's home (I usually throw them away w/o looking through them). My mom has an account with Midnight Velvet. I think that it's one of those guaranteed credit merchandise cards. I will look into it further.

[Anonymous]

I followed a few links at the Midnight Velvet website and found that they do pull a hard inquiry for someone to sign up with "Choose N Charge."

The more I think about the junk mail offers I've received, the more skeptical I am that those are what is meant here, because without my SS#, I don't believe a creditor can report to a CB, can it? The one offered at the link above, which does require a certain amount of personal info to be given, seems more likely. But as poster above says, Google the hell out of it--unfortunately, they don't give the name of the company extending the credit.