topic Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 ! in Credit Cards

Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 18:27:55 GMT

Hey all! I have gotten aamzing advice on this forum, and am back for more. Bare with me, as I'm laying out my whole credit profile here ... My current scores sit at 580 TU, 585 EX and 550 EQ (always my worst). These are up from: 488 TU, 445 EX and 490 EQ 12 months ago, when I couldnt get a credit card to save my life. My current portfolio for revovling credit is as follows:

Barclaycard Apple VISA: $2800 / $3000 (0% APR until Dec) -- FINANCING iMac

CareCredit: $1400 / $3,000 (0% APR until Dec)

Western FCU VISA: $600 / 1,000 (14% APR) -- Used for Home Improvement

NFCU Visa: $590 / $700 (8.99% APR) -- Used for new home decor

Credit One: $390 / $600 (19.99% APR) -- MISC / GAS Card only

Capital One QS1: $100 / $500

Capital One PLATINUM: $300 / $500

FingerHut: $0 / $300

So, my overall UTIL is high - I know that - around 70%. I plan on paying large chunks off over the next 2-4 months.. what should I pay first? I want to get my CAP ONE cards down to 10% each, because I'm on credit steps and am told if I use the card heavily and pay down or PIF each month, the CLI at 6 months can be HUGE (Ive seen people here get $1000 - $4000 CLIs on Credit Steps!). As it is, the Executive Office is working on raising my limit ot $1,000 each card -- we'll see. I also want to pay down Credit One (the crappier version of CAP ONE!) to near 0%, and let it sit to help UTIL. The rest of my credit profile is $100k+ in Nursing student loans, a $20k auot loan at $16k balance, and 2 collections about to age off under $1k each. My income ranges, as I do private duty nursing. Around $50-70k annually, plus a trust. FYI: My AAofA is 7 years, oldest is 12.5 years. All my credit cards were opened between 6-10 months ago.

What can I do to hit 700 within 12 months? Maybe even less? Any and all advice is appreicated here !! I would love to start seeeing those APPROVED notices online instantly as opposed to recons :-) Thank you all !

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

OmarGB9 — Sat, 18 Jul 2015 18:31:10 GMT

I'd pay off the higher interest balances first and foremost, and lower as many of your cards down to zero/near zero as you possibly can. That's probably all you can do right now besides waiting and just letting your accounts age.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 18:36:02 GMT

I know it is a lot of hard work. One thing I can offer is to do whatever you can to pay it to 20% or below and keep the mindset that you will never go above 20% in utilization. (10% or less is better, but trying to be realistic for first steps). Developing the mindset and habits is key. You have to look at the things and behaviors that led to getting up to 70% utilization and change that mindset. It helps to pretend that you don't have more than x available on each card so you don't go over that amount.

Even if you have 1 card that only has 1k credit limit, pretend the only amount you can use is $200. I know, it's hard, not always practical and realistic, but will help you form good habits and keep you out of trouble.

From the balances and other high usgae it looks a bit as if you have been using credit cards almost as income and not paying down.

Having a large auto loan, large student loans and high credit card utilization is tkaing you in a direction you can reverse if you can get your mindset in a different place. I know it isn't easy.

Things will improve a bit when the collections age off as well.

Setting good habits now will reap lifelong rewards, I promise! Don't look at it as "reaching 700 FICO", look at it as "creating the kind of habits I want that will keep me consistently in a good area with credit and not get me into hot water."

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 18:38:01 GMT

The amount of student loans is staggering and I just don't want to see you get yourself in more hot water by maintaining a high credit card utilization while also having a high balance auto loan. Hope that makes sense.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

SOGGIE — Sat, 18 Jul 2015 18:49:13 GMT

@OmarGB9 wrote:
I'd pay off the higher interest balances first and foremost, and lower as many of your cards down to zero/near zero as you possibly can. That's probably all you can do right now besides waiting and just letting your accounts age.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 18:56:32 GMT

humunk: Thank you so much that is stellar advice. I am going to pay off my CAP ONE cards and all others until 20% UTIL, then use the CAP ONE QS as my main card and PIF monthly. I cant do much about my student loans, those are like mortgages -- will take 30 years unless I hit the lotto !!! :-)

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 19:03:22 GMT

Do you have any late payments or anything else derogatory other than the 2 collections? Those scores seem awfully low considering the collections are about to age off.

The best you can do is 1. Pay down the CC debt to get utilization as low as possible. 2. Try for SP CLI's as that will lower utilization as well without score dings for inquiries. 3. Wait for the collections to drop off. That is about all you can do.

Good luck paying all that student debt off. I couldnt imagine having that much student debt hanging over my head!

As a side note Credit One isnt a version of Capital One. They are totally different companies and not even close to being the same type of lender. Just the names are somewhat similar. Capital One = good. Credit One = atrocious pile of garbage.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 19:15:11 GMT

Yes, I have several late payments (30 day only) from 9-12 months ago though... my credit report has shown CURRENT on all debt for 6-9 months. Never late on auto loan or credit cards. Student loans had many lates last year due to lost income and illness -- about 10 lates OVERALL on different loans, so that expalins the score too, though it should be recovering each month paid on time. I hope at least? And Credit One is different I know .. I meant they are the crappier version in the terms of like the ugly little sister

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 21:04:36 GMT

Those lates will definitely make the journey more difficult, but as with the collections they will have less impact the older they are. Looking into a LoC may not be a bad idea to keep you from getting future lates in case something else happens to where you cannot pay for a month or two.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 21:12:27 GMT

JohnnyC - that's what I thought too but I can't get approved for a LOC yet! Go figure I have $10,000 in revolving credit but no bank will give me LOC. I'm hoping by December or Jan. that'll change as the lates will all be well over 1 year old and collections gone. And lower UTIL for sure by then. I'm aiming for 620-640 by Jan. doable ?

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sat, 18 Jul 2015 21:23:13 GMT

If you can get the revolving credit down to under 20%, i would think that would be totally doable. Utilization is a hefty chunk of the score calculation.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sun, 19 Jul 2015 07:13:58 GMT

Talk to your Credit Union or a sub-prime lender and try to get a personal loan or auto refi (if you have equity), pay off those credit cards, dig a big hole in the back yard, toss the credit cards in, and fill the hole. Forget the credit cards for 5 years to get your mindset straight. If you don't have enough for a iMac or home decor, you save.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sun, 19 Jul 2015 13:55:32 GMT

Slipper lol

That's funny actually .. But I'm told credit cards are very necessary to build credit. Without it you can't show a lender that you use credit responsibly. Student loans only show so much. They aren't revolving.

However I would like to maybe get it down to 1-2 cards with higher limits as opposed to smaller cards and many accounts. And as for a personal loan - can't get one even with a co signer until I hit 615 score is what I'm told even at my amazing credit union WFCU in L.A. I was shooting for a $8,000 loan to wipe out my debt - no dice ! Not yet at least. If you have any recommendations I'm all ears

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sun, 19 Jul 2015 15:01:45 GMT

@Anonymous wrote:
Slipper lol

That's funny actually .. But I'm told credit cards are very necessary to build credit. Without it you can't show a lender that you use credit responsibly. Student loans only show so much. They aren't revolving.

However I would like to maybe get it down to 1-2 cards with higher limits as opposed to smaller cards and many accounts. And as for a personal loan - can't get one even with a co signer until I hit 615 score is what I'm told even at my amazing credit union WFCU in L.A. I was shooting for a $8,000 loan to wipe out my debt - no dice ! Not yet at least. If you have any recommendations I'm all ears

credit cards are indeed important for building credit. However, money is also important, and money is, generally, more important than credit.

Here is what I would do:

1. close credit one now. Seriously. The only reason to ever deal with them is if you cannot get ANY other card. You are in with cap1 and barclay. Other primer lenders will follow. credit one cannot help you now. This will save you money in ridiculous fees and interest.

2. Make progress on paying down your balances on the non-0% cards. Then start saving so that when the time comes you can pay them off and not have to pay interest.

3. Only charge to credit cards what you can afford to PIF and not pay interest. You should never be paying interest to the banks.

4. Take slipper's advice to heart, even if not literally. There is no excuse to ever finance home decor or home improvement on a credit card that you pay interest with. EVER. Those are luxuries that you get when you can afford them. If you are paying interest, it means you could not afford them. Similarly for financing an iMac, unless you are a graphic designer or IT specialist and need it for work (not the case for you).

Seriously. 90% of growing your credit is not overextending. Gimmicks like consolidating ballances with loans or lines of credit do work to speed up the process, but without the right attitude it won't work, and might get you in more trouble.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

DrZoidberg — Sun, 19 Jul 2015 15:06:49 GMT

Sell your car and get a cheaper one or find alternate transportation. If you're carrying balances on credit cards you shouldn't be in a $20k car.

I'm not here to judge you I'm just here to offer advice based on the information provided.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sun, 19 Jul 2015 15:13:16 GMT

Great feedback here. Won't closing my Credit One hurt my score though since it's already 10 months old and aging ? I was told it's only good to close new credit accounts immediately after opening so they don't factor into age.

As for my car, I can afford my car because my father pays every other month (I'm young-ish and it's an agreement we made after I graduated nursing). In addition, once I get my advanced nursing degree in a year or so my income is going to sky rocket $30,000 more annually. So I'm looking forward to that too!!! I think paying these cards down and rarely using is my best strategy now. I can't lie -- I'd love the day I see an approval for a prime card online with a $25,000 limit ! Even if just for the moment.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sun, 19 Jul 2015 15:34:55 GMT

@Anonymous wrote:
Great feedback here. Won't closing my Credit One hurt my score though since it's already 10 months old and aging ? I was told it's only good to close new credit accounts immediately after opening so they don't factor into age.

As for my car, I can afford my car because my father pays every other month (I'm young-ish and it's an agreement we made after I graduated nursing). In addition, once I get my advanced nursing degree in a year or so my income is going to sky rocket $30,000 more annually. So I'm looking forward to that too!!! I think paying these cards down and rarely using is my best strategy now. I can't lie -- I'd love the day I see an approval for a prime card online with a $25,000 limit ! Even if just for the moment.

The credit one card will continue to contribute to your credit score for 10 years after it is closed. and since all your cards are of similar age you will see no score decrease pretty much - either now or 10 years from now.

Also closing new credit accounts immediately after opening isn't any better than closing them 10 months later. If it showed up on your report, it will factor into the age.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

OmarGB9 — Sun, 19 Jul 2015 15:36:54 GMT

@Anonymous wrote:
Great feedback here. Won't closing my Credit One hurt my score though since it's already 10 months old and aging ? I was told it's only good to close new credit accounts immediately after opening so they don't factor into age.

As for my car, I can afford my car because my father pays every other month (I'm young-ish and it's an agreement we made after I graduated nursing). In addition, once I get my advanced nursing degree in a year or so my income is going to sky rocket $30,000 more annually. So I'm looking forward to that too!!! I think paying these cards down and rarely using is my best strategy now. I can't lie -- I'd love the day I see an approval for a prime card online with a $25,000 limit ! Even if just for the moment.

False. Someone correct me if I'm wrong, but as soon as you're approved the account will show up on your CR and factor into your AAoA regardless of whether you decide to keep it open or close it. Also, closing it won't affect your AAoA immediately because the closed account will remain on your CR for 10 more years, by which point it shouldn't matter anymore anyway.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Gmood1 — Sun, 19 Jul 2015 15:40:05 GMT

It's great that your Dad is helping you out! That's also a very nice raise to look forward to. If I were in your shoes, I'd focus on living comfortable at your current income. Do not stack any more bills. Nothing wrong with using your cards, just PIF. As mentioned previously, do not charge on the cards what you do not have in your bank account.

Many people focus on earning more money, but completely miss the boat on managing it. lol You can earn a million dollars a year and still be so broke, you couldn't afford to buy a mosquito a wrestling jacket. If you stack bills.

Re: Advice needed - Climbing the CREDIT LADDER !!! GOAL: 700 Club by July 2016 !

Anonymous — Sun, 19 Jul 2015 16:10:25 GMT

You are all great!!!! I will be doing just that. Someday I'll hit 700!! Then I'll get one huge CL credit card and call it a day lol!!!!