topic PenFed Approval #2 !! in Bankruptcy

UPDATE A few questions to kick start my rebuild?!?

Anonymous — Wed, 28 Oct 2020 21:01:01 GMT

*** I will keep this thread up to date as my rebuild continues***

Hello all, I have a few things I need help with!

My bk was discharged on March 11, 2020. The same day I immediately got the Credit One card, CL $300, and going to $500 next month and also got the Capital One Platinum card, CL $300 which they raised to $400 after month 2 and will go to $500+ automatically next month with credit steps. Also, Capital one just upgraded my Platinum to the Quicksilver, not QS1, with no AF. I've been looking for the 3rd card but didn't want another dead end card unless I had to.

Today, after research on here, I found out that I could join NFCU! After 15 minutes on the phone, I was in! I'll only have a savings account with them since my business and personal accounts are established with my local bank so I'm just going to stick $250 every month in it, above whatever I deposit for the card, and let that build up. I went ahead and hit the pre-qual and they offered me the NSecured card with them. I have no problem with that as I know it's likely they upgrade me in 6 months and bump the limit up on the unsecured card. I haven't done that yet though.

I would really like to be able to get a business cc to start building my business credit, I've only ever had one card for that which was the Ink Preferred and iib. I've been looking at the Capital One Spark Classic, seems like the easiest to get, and was going to apply for it at the 6-month mark of my bk discharge and the 6-month mark of having my first card with them, the QS. Also, I like to keep the business part separate so I just use debit now. Having that card report to both personal and business is a benefit right now to help with both scores over time.

In addition to that, I need to get a 24 month Self Builder Loan to have an installment loan. I was going to pay 6 months of the 24 upfront to cut the utilization down and pay it for the next 18 until it's done.

My questions are about the timing of it all. I want to get this done and then let it all ride and build up from then on, garden.

Would you all wait on adding the secured card and the Self loan until I apply for the Spark Business card at the 6-month mark to hopefully get that then hit the pre-qual again and if NFCU says secured only still add that card and the loan then be done? Or would you recommend I go ahead and get the secured NFCU card and the loan going right now then just apply for the Spark in 2 months when the time comes? Or any other scenario that makes all this most likely to happen?

The other question I have is about the NFCU secured card. From what I have seen on here most people just do the $500 on the secured and are graduated to the unsecured with a $2,000 at the 6-month mark. If I start with a higher secured amount, $1,000-$2,000 or more, is it more likely I get a higher unsecured line when it switches or no, or does that affect it one way or another? I stay cash-heavy so the security deposits aren't a problem to build better credit lines and relationships with them.

Thank you guys for all your help!

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 01:01:27 GMT

@Anonymous Coming out of BK the most important thing you can do is establish tradelines and positive payment history and you are under a penalty unless you have at least three revolvers anyway. The fact that you are prequalified for the secured Navy is not a guarantee, but I would definitely try for it. You need another tradeline building history and gaining age. Navy is arguably one of the best.

I would also do the SSL technique if you have no installment loans and Navy is perfect for that as well. But after that I think you need to wait more than any two months before you go for further credit. I understand you want to get your business credit started as well, but it would really be great to wait 12 months, but a minimum of 6 before I would do anything after that.

Welcome to the forum, you might want to read the Scoring Primer linked at the top of my signature. It will give you a lot of information and teach you the basics... well more than the basics 😉

Re: A few questions to kick start my rebuild?!?

Beilin — Fri, 17 Jul 2020 02:29:00 GMT

@Anonymous

The secured card is an awesome option to build with NFCU especially since they like you to be a year post discharge before extending unsecured credit. If you put more than $2000 down as the deposit the card will unsecure and will not be given an auto CLI which is why a lot of users recommend just opening it with the minimum. There has been some success recently with requesting a CLI the day the card graduates, maybe this would be an option for you if you decide to open it with a large amount. Hope this helps, good luck on your rebuild journey!

Re: A few questions to kick start my rebuild?!?

AllZero — Fri, 17 Jul 2020 07:16:37 GMT

I agree with @Anonymous for the Navy SSL.

I would recommend reading the below from CreditGuyInDixie
Adding an installment loan -- the Share Secure technique
The Quest for an SSL alternative to Alliant

NFCU SSL

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 14:15:15 GMT

Thank you for all the advice. I was unaware NFCU has such a fantastic SSL option. I appreciate all the links and resources, I learned a lot! I transferred $5,000 to my NFCU savings account this morning. As soon as that shows in the account I'm going to go ahead and apply for the NFCU secured card and hopefully get that going with a $750 limit so I can use it and just pif weekly. And after they give me the credit card I'll apply for the $3,010 secured 5-year loan and immediately pay that down to an 8% balance the day it opens. Then just let everything build until the 1-year mark of discharge then see what happens. That'll give me 3 cards and an installment loan.

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 20:46:34 GMT

Whoo Hoo! After a couple of hiccups today I am good to go! When I set up my membership yesterday the lady on the phone gave me one to many 0's in my account number so when I transferred the 5K this morning it went to NFCU but to an invalid account number so NFCU did not receive it. Fortunately, I was able to transfer another 5K this afternoon to the correct account that was received. Now I'm just waiting on the first 5K to get rejected by NCFU and sent back to my primary bank next week, per my conversation with both banks. Frustrating but human error happens, I should have double-checked.

With that done I called up NFCU and was approved for the secured nRewards card! I just got them to set it up at a $500 SL, since you have to pick a specific number to have approved, which was no problem. I'll have my card in 3-5 days! I'm just going to use it a lot and pif monthly then see what happens at the 3 and 6-month mark with the auto reviews. I asked after I was approved if I could bump it to $750 since I have plenty of "security money" with them and she said she could put in for the request but that it might cause a second hp. She said they may just use what they just pulled since it would all happen today and they just did that but couldn't guarantee no second hp so I said no. Thoughts?

While I was on the phone with them they also went ahead and set up my SSL! I did a $3,010, 60-month loan at 2.25% with a $53.11monthly payment. He said everything should be set up within an hour or so.

I just want to confirm, when they deposit the funds back into my account today I am going to immediately make a payment of 92.1% of the balance off with that money, which is a $2,772.21 payment? That will leave 7.9%, which is $237.79, as the remaining balance, and then I won't have a payment due for like 4.5 years but the account will continue to report and help me build my credit for the next 5 years. Is that the correct way of doing it?

Thank you for the help @Anonymous , @Beilin , and @AllZero !

Re: A few questions to kick start my rebuild?!?

Beilin — Fri, 17 Jul 2020 20:51:08 GMT

@Anonymous

Congrats! You're off to a really great start. Yes you are correct in regards to the SSL, it will give you a "paid on time" mark every month while reporting until the balance is 0. I would pay like $1 every month or so to prevent it from going dormant but good job!

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 21:00:12 GMT

Thank you @Beilin ! I will do that today as well then. What about the second hp to adjust the SL on the card to $750. Have you heard of them using the one they just pulled the same day or do you think it's likely to second hit? I don't want any additional inquires.

Re: A few questions to kick start my rebuild?!?

Beilin — Fri, 17 Jul 2020 21:03:53 GMT

@Anonymous wrote:
Thank you @Beilin ! I will do that today as well then. What about the second hp to adjust the SL on the card to $750. Have you heard of them using the one they just pulled the same day or do you think it's likely to second hit? I don't want any additional inquires.

This is very YMMV, I added on to the card a few days after getting approved and I did not have a hard pull but a family member did have a hard pull when they did the same. Is there a specific reason you want to increase the limit? I think if you really want to be safe it might be best to leave it as.

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 21:05:49 GMT

@Anonymous wrote:
Whoo Hoo! After a couple of hiccups today I am good to go! When I set up my membership yesterday the lady on the phone gave me one to many 0's in my account number so when I transferred the 5K this morning it went to NFCU but to an invalid account number so NFCU did not receive it. Fortunately, I was able to transfer another 5K this afternoon to the correct account that was received. Now I'm just waiting on the first 5K to get rejected by NCFU and sent back to my primary bank next week, per my conversation with both banks. Frustrating but human error happens, I should have double-checked.

With that done I called up NFCU and was approved for the secured nRewards card! I just got them to set it up at a $500 SL, since you have to pick a specific number to have approved, which was no problem. I'll have my card in 3-5 days! I'm just going to use it a lot and pif monthly then see what happens at the 3 and 6-month mark with the auto reviews. I asked after I was approved if I could bump it to $750 since I have plenty of "security money" with them and she said she could put in for the request but that it might cause a second hp. She said they may just use what they just pulled since it would all happen today and they just did that but couldn't guarantee no second hp so I said no. Thoughts?

While I was on the phone with them they also went ahead and set up my SSL! I did a $3,010, 60-month loan at 2.25% with a $53.11monthly payment. He said everything should be set up within an hour or so.

I just want to confirm, when they deposit the funds back into my account today I am going to immediately make a payment of 92.1% of the balance off with that money, which is a $2,772.21 payment? That will leave 7.9%, which is $237.79, as the remaining balance, and then I won't have a payment due for like 4.5 years but the account will continue to report and help me build my credit for the next 5 years. Is that the correct way of doing it?

Thank you for the help @Anonymous , @Beilin , and @AllZero !

Yes great congratulations!! just a couple caveats.

You only have to pay it down to 9% not 8%. Also, I would allow it to report to the bureau before I paid it down. There is a recent report of someone who had the paiddown amount reported as the loan amount at one bureau, so out of an abundance of caution I would wait until it reports before I pay it down.

They typically report very quickly, so it shouldn't take long.

You should see a nice boost from the third card and the SSLT! 😊

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 21:08:27 GMT

They are HP happy so you better assume a HP and be happy if it’s not if you do.

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 21:11:47 GMT

It's not a necessity but I have read on here that this bank, just like Capital One, likes heavy usage and multiple monthly payments. So I just run any and everything, purchases, and all my memberships and subscriptions through the cards. I've been doing that with the Capital One but with a couple of days delay on things posting I am making payments every day or two, pif every time, because of the low limit. I would rather just pay it off once a week if there was more credit available. I'll just alternate the two cards to make it simple and do without the risk of another pull.

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 21:17:15 GMT

Thanks, @Anonymous , that is definitely good to know. I've already signed the loan docs and see the money back in my account from the loan although the loan isn't showing up in my accounts yet for payments, etc. I'll just wait until it hits my credit report and shows the full amount then pay it down and let it ride. It will report to all three bureaus, correct?

Also, once I pay the $2,700 ish payment will that money be returned to my savings account again, or is it held until the loan is pif in 5 years? If that makes sense.

Re: A few questions to kick start my rebuild?!?

Beilin — Fri, 17 Jul 2020 21:19:46 GMT

@Anonymous

Capital one definitely likes heavy usage and will penalize you for not using your card enough but Navy not as much. There's posts of people with very little usage on their cards receiving early graduations and auto CLIs. I do agree with @Anonymous post above and I think it might just be best to leave it.

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 21:20:36 GMT

@Anonymous wrote:
Thanks, @Anonymous , that is definitely good to know. I've already signed the loan docs and see the money back in my account from the loan although the loan isn't showing up in my accounts yet for payments, etc. I'll just wait until it hits my credit report and shows the full amount then pay it down and let it ride. It will report to all three bureaus, correct?

Also, once I pay the $2,700 ish payment will that money be returned to my savings account again, or is it held until the loan is pif in 5 years? If that makes sense.

It's unfrozen as you pay it down, so it'll be accessible again in your savings

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 21:22:41 GMT

Perfect! It sounds like I am good to go for a while. Let the credit score growth begin!

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 22:15:02 GMT

@Anonymous wrote:
Thanks, @Anonymous , that is definitely good to know. I've already signed the loan docs and see the money back in my account from the loan although the loan isn't showing up in my accounts yet for payments, etc. I'll just wait until it hits my credit report and shows the full amount then pay it down and let it ride. It will report to all three bureaus, correct?

Also, once I pay the $2,700 ish payment will that money be returned to my savings account again, or is it held until the loan is pif in 5 years? If that makes sense.

@Anonymous sorry for the delay but as stated, as you pay it down, they release the same amount of funds you pay down. So basically your money is only tied up for a very short time except for the 9%.

Yes that's correct and yes it will report to all three bureaus. You're good to go it sounds like! You're in for some nice score returns.

I would recommend staying in the garden for 12 months at a minimum. But for best score across all versions, 5 cards is best, imho, so you might look around and see if there's 2 more cards you want and if so hit the go button when the card you just got turns 12 months old. It's best to go ahead and get them and get it over with and then stay in the garden, because the longer you're in the garden, the better your ages get.

Would be nice for you to contribute your data points as the third card reports and as the SSL reports and as the paydown reports! We would be grateful, and if possible try to hold utilisation and number of accounts constant if you can based on reporting date, so the DPs are not conflated, if possible.

Re: A few questions to kick start my rebuild?!?

Anonymous — Fri, 17 Jul 2020 22:16:18 GMT

Oh yeah congratulations!

Re: A few questions to kick start my rebuild?!?

Anonymous — Sat, 18 Jul 2020 11:44:09 GMT

Thank you. That's what i plan to do. I'm just going to wait and see what Capital One offers after using the QS for a good while as my primary and pif, and also hopeful NFCU graduates me to an unsecured with a nice CL increase in 6-7 months. I just got My FICO Premier so I'll make sure to update you all as i go monthly. Still trying to figure out the signatures but i have the thread for that to go through. I won't have my starting point post bk but will have it from this month out.

Re: A few questions to kick start my rebuild?!?

Anonymous — Sat, 18 Jul 2020 12:42:53 GMT

Here is where I am 4 months post bk with only 2 credit cards reporting, both 0% utilization.

My Fico Premier

Equifax: FICO 8 - 623, FICO 9 - 670

Transunion: FICO 8 - 611, FICO 9 - 624

Experian: Fico 8 - 610, Fico 9 647

Credit Karma shows TU as 652 and Equifax 673 which I know doesn't matter but maybe it'll help some people see a difference with the real picture.

TU has 3 hp's (including the new NFCU pull), Equifax has 2, Experian shows 8 (half of those are from a car purchase in 2018)

topic PenFed Approval #2 !! in Bankruptcy

*UPDATE* A few questions to kick start my rebuild?!?

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UPDATE A few questions to kick start my rebuild?!?