topic Re: Diminishing Returns in Score Gain from Secured Cards? in Bankruptcy

Diminishing Returns in Score Gain from Secured Cards?

Xyta — Tue, 15 Jul 2025 15:49:25 GMT

I have a Ch 7 that discharged about three years ago now. I've opened a Credit One $500 unsecured card and a $500 Armed Forces Bank (?) Secured Card. Is there value in opening a second secured store (Amazon) card?

Re: Diminishing Returns in Score Gain from Secured Cards?

Vinjints — Tue, 15 Jul 2025 15:59:22 GMT

I don't see any point in opening additional secured cards. Let them age for 6 months to a year, hopefully graduate, and then you can apply for non-secured. Even without graduating, you would be making progress in showing payment history and use on those two.

Re: Diminishing Returns in Score Gain from Secured Cards?

FicoMike0 — Tue, 15 Jul 2025 17:46:09 GMT

There does seem to be a benefit to having up to three cards reporting paid on time to build positive history. I'm not sure store cards always count, better a bank card if you can get one. Low limit secure cards seem to ring the bell for on time payments as well as any card. With three cards you can do azeo, which is good for a boost. Also manage utilization. With low limit cards you can kill your score if you don't manage reported utilization.

Re: Diminishing Returns in Score Gain from Secured Cards?

Vinjints — Tue, 15 Jul 2025 18:02:33 GMT

You only need to worry about AZEO before you apply for additional credit. If someone is trying to build/reestablish credit they don't need to worry about optimizing scores that are in the tank. Short game matters in golf; credit is a long game.

Re: Diminishing Returns in Score Gain from Secured Cards?

JoeRockhead — Tue, 15 Jul 2025 21:44:20 GMT

@Vinjints wrote:
You only need to worry about AZEO before you apply for additional credit. If someone is trying to build/reestablish credit they don't need to worry about optimizing scores that are in the tank. Short game matters in golf; credit is a long game.

I agree with this, but would point out that with Fico 10T and VS4 possibly becoming more prevalent in mortgage lending, prospective mortgage applicants might want to start the AZE1 practice sooner rather than later, to influence trending score algorithms if they think they might apply for a mortgage in the next 24 months.

Re: Diminishing Returns in Score Gain from Secured Cards?

JoeRockhead — Tue, 15 Jul 2025 18:43:03 GMT

@Xyta wrote:
I have a Ch 7 that discharged about three years ago now. I've opened a Credit One $500 unsecured card and a $500 Armed Forces Bank (?) Secured Card. Is there value in opening a second secured store (Amazon) card?

@Xyta what are your current Fico scores and when did you open your current cards? I agree you should avoid store only cards and focus more on major bank cards (when the time is right to add an additional card).

Re: Diminishing Returns in Score Gain from Secured Cards?

FicoMike0 — Fri, 01 Aug 2025 20:43:03 GMT

I'll just point out that to get the value from aze1 when you need it, like most things, it's best to get some practice ahead of time. That will avoid the "I didn't know when my account posts" and other excuses. Make the mistakes when it doesn't count. At least avoid the all zero penalty, that's not a nice surprise.