topic Avoid Junk Cards! - Credit Union Solution in Credit Cards

Avoid Junk Cards! - Credit Union Solution

moondog7324 — Mon, 09 Feb 2009 03:44:48 GMT

I am convinced junk begets junk: I spent years with crap1 and Orchard junk cards with 300 dollar limits- and what good is a 200 Target card? I think these cards are a chargeoff waiting to happen:

Here is what I did and it helped me tremendously. I joined a credit union and opened a savings account- each paycheck I had $100 direct deposited to the account. After 10 pay perionds- (20 weeks) I had $1000. I used that amount to get a secured card. I try to keep the balance below 400 and pay in full every month. I have yet to pay a penny interest on that card. That card has created trust from the credit union, I have since re-financed my auto loan and got a $5000 line of credit, that I can use as a signature loan anytime. I think the key is getting above that $1000 mark before getting the secured card. Right now I'm not so concerned about my actual score as I am about building a good history and trust from the credit union- The scores will come in time. In a few months my year is up- I've will then have a unsecured card and a $1000 in a savings account that I didn't miss at all.

Kudos!

After this I was able to get a 4000 Chase platinum. My scores were not in platinum range but I'm convinced by waiting for my first $1000 card to mature and then asking for additional credit I was able to look better in the eyes of lenders. My goal for 2009 in NO inquiries ( unless I feel brave enough to apply for a mortgage)

Re: Avoid Junk Cards! - Credit Union Solution

Anonymous — Mon, 09 Feb 2009 10:09:49 GMT

Absolutely wonderful advice for anyone trying to rebuild credit...especially in this economy! I think I'll suggest this to my daughter who is just starting to think about building her own credit.

Re: Avoid Junk Cards! - Credit Union Solution

moondog7324 — Wed, 18 Mar 2009 04:32:56 GMT

Don't waste money on annual fees!

Re: Avoid Junk Cards! - Credit Union Solution

Anonymous — Mon, 23 Mar 2009 20:33:18 GMT

did you keep the junk cards or did you cancel them? Once I get my house I'm just going to cancel all those crappy cards. Those crappy cards did help rebuild my credit though but I'm stuck in low credit limit hell. I hate it.

Re: Avoid Junk Cards! - Credit Union Solution

moondog7324 — Mon, 23 Mar 2009 21:18:15 GMT

I weeded them out. When do you plan on trying for the new house? I think I would wait until you get that mortgage (unless your scores are really low and you have a year of building new credit)

Be careful making any changes prior to the home loan, that includes applying for new cards.

Re: Avoid Junk Cards! - Credit Union Solution

PayingTheBills — Mon, 23 Mar 2009 22:02:58 GMT

Awesome advice moondog. After reading this thread, I paid the $20 for membership to be able to join PenFed and signed up for a Share account.

Once I get my welcome package in the mail, I'll sign up for auto-debit from my checking account for $100 every two weeks just like you did.

I had been looking for a good local CU to join, but I keep hearing nothing but good things about PenFed, so I decided to pull the trigger.

Kudos to you!

Re: Avoid Junk Cards! - Credit Union Solution

Anonymous — Mon, 23 Mar 2009 22:12:55 GMT

CU are famous about for not reporting , Cu dprdn't repprt to TU

Re: Avoid Junk Cards! - Credit Union Solution

moondog7324 — Mon, 23 Mar 2009 22:13:09 GMT

I've heard great things about PenFed- I used NFCU. The other nice thing is member specials- such as GEICO auto- I saved $$ just by joinig through the NFCU website.

If you have the patience to get to th 1000 mark, it does two things: creates good relationship with the CU and most importantly, creates good savings habits.

Re: Avoid Junk Cards! - Credit Union Solution

moondog7324 — Mon, 23 Mar 2009 22:15:02 GMT

NFCU reports to all 3. They pull from EQ.

Re: Avoid Junk Cards! - Credit Union Solution

PayingTheBills — Mon, 23 Mar 2009 22:22:51 GMT

After checking whogavemecredit.com, it looks like PenFed pulls EQ too, which will be good for me in the future because my EX score tends to lag behind a little, and my judgement only reported to EX and TU.

Re: Avoid Junk Cards! - Credit Union Solution

Anonymous — Tue, 24 Mar 2009 01:26:19 GMT

I will try and get preapproved in August. I'm in the process of saving for a downpayment. My midscore is 682, so I won't close any of my cards until I close on my house. I just don't understand why I can't get higher limits with a decent score(a 682 is pretty decent right?)

Your advice makes perfect sense.

Thanks

Re: Avoid Junk Cards! - Credit Union Solution

Lyythine — Tue, 24 Mar 2009 01:37:13 GMT

Penfed pulled EQ both times I applied for products from them. Once when i opened the account (Boston, MA) and last month when I got a credit card from them (Georgetown, DC). I think they pull EQ pretty much universally. Not entirely sure though. CU is definitely the way to go in any situation, however. I am a member of two, and although I hear alot of bad press on Penfed on these forums, they have always been very good to me, in fact, i opened that card most recently and it is actually my highest limit at 15.5k

Other cards are as follows:

HSBC: 5.5k

BofA: 11k

Chase: 9k

Chase: 5k

Citi Diamond: 10k

Other CU: 3.5k

I have other cards (store, gas, etc but all those cards have lower limits than ones listed above.