topic Re: Building credit from scratch, next steps (card)? in Credit Cards

Building credit from scratch, next steps (card)?

Anonymous — Thu, 07 Jul 2016 04:42:43 GMT

Hey Guys,

My first post here, however I've been lurking for awhile.

I moved to the US about 2 years ago from Sweden, a country where we don't have the same system as here so I didn't get my first card until a couple of months back. I'm trying to build my credit to be able to rent apartments, rent cars without spending hours trying to get them to let me use a debit card etc. Eventually it would be nice to have a decent travel/resturant rewards card.

Right now I've got a Cap 1 Secured with a $200 CL, an account that is 4 months old. Always paid fully on time and have a 5% average utilization (literally just using it for netflix).

Haven't pulled my FICO score yet but my FAKO (am I using this right?) is according to CreditWise and CreditKarma 676.

Income is a bit over $80k.

My question is what is my next steps/what card do I apply for next, and when?

According to Credit Karma my approval odds are very good for Amex Blue Cash Preferred (how?) and Cap 1 Quicksilver one.

I've also got a banking history with chase from when I first got here and from what I've understood that can be pretty helpful.

Thanks!

Re: Building credit from scratch, next steps (card)?

Anonymous — Thu, 07 Jul 2016 04:49:08 GMT

In the unlikely event you still have a Swedish amex, you could try using the global transfer program. That's usually something I'd recommend to be done day one though, not 2 years after moving to the US. AmEx global transfer doesn't always work for people who have already started a credit history in the destination country

Otherwise wait until you hit six months of history and then see if Chase has any pre approvals for you online and in branch.

Re: Building credit from scratch, next steps (card)?

brother7 — Thu, 07 Jul 2016 10:27:07 GMT

I'm helping a friend build credit from scratch. Like you, she started with a Capital One Secured card with a $200 CL.

Just before the due date on her 5th statement, we checked the current balance and made a payment such that the remaining balance was $2. Then she stopped using the card until her 6th statement cut. The 6th statement showed a balance of $2 which is 1% utilization of her $200 CL. (Incidentally, on her 6th statement, her CL was increased to $500).

We used Credit Karma to monitor when the 6th statement was reported to the CRAs. Once reported, we applied for her 2nd card, a Discover it card. She was approved for $1000. We chose Discover it because it's one of the easier cash back cards to get with limited history.

So now she has two cards, the Cap One Secured and the Discover it card. She'll pay off and sock drawer the Cap One Secured card. It has served its purpose. We'll implement the same strategy with the Discover it card, letting the 6th statement show a 1% utilization. Then we'll apply for a 3rd card. Still deciding which card to go for, but I'm hoping for a Citi Double Cash card.

We'll continue this strategy and apply for a 4th card, not sure what yet. Once the 4th card is approved, we'll finally cancel the Cap One Secured card, leaving her with 3 cards, all rewards cards of one type or another. At that point, we'll reevaluate what to do next. I think this is a good 2-year plan to a solid credit profile.

The key to this strategy is to have all cards report 0 balance except for one card which reports 1% utilization at the time you apply for credit.

Re: Building credit from scratch, next steps (card)?

RonM21 — Thu, 07 Jul 2016 21:54:56 GMT

Welcome! You could try to move to an unsecured card. But also a safer move would be to go for maybe a QS1. I think it would be good at least to get a second card to begin to advance your credit history.