topic Re: 20's - How should I proceed? in Credit Cards

20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 01:11:00 GMT

hi, all! i've gotten plenty of good advice on this site by reading through posts.......but i'm curious as to your thoughts as to what i should do next.

ii'm in my 20's, still a student (grad school). i haven't paid for a "proper" credit score (but do check my credit report annually). i use credit karma ("fako") and it tells me i'm at 720 (i was at 770 in sept, but i applied for 2 cards, amex-denied, and cap1-3K but now i read i shouldn't have applied for it).

I have 8 hard pulls on my credit report currently. I've been denied by AMEX and the REI visa card. i don't have any loans/debt; i don't have any car payments; i rent (500/mo.) with an annual income of 30,000; my utiliziation is pretty low, around 10% and i always pay in full and never carry a balance.

i don't know if i should be "gardening" or applying for another card (or two) that give rewards while i have the 8 inquiries already on my credit report......

here's what i'm working with (date opened) - Card - Credit Limit

09/2010 - PNC VISA - 8500 (just moved credit over to one and closed another from PNC)

12/2010 - Discover - 3000

05/2011- Citibank Platinum - 7500

05/2011 - Cap 1 - 3000

06/2011 - Chase Sapphire - 10000

what should i do now???? help! my goal is to get the best credit possible to be able to get the best mortgage rates possible (and car stuff). i also like the thrill of trying to get as high of a credit score(s) and credit limit as possible. i also want at least 1 more rewards card (i'm thinking either of the southwest cards, the rei card, any other suggestions?)

Re: 20's - How should I proceed?

LS2982 — Wed, 04 Jan 2012 22:46:30 GMT

@Anonymous wrote:
hi, all! i've gotten plenty of good advice on this site by reading through posts.......but i'm curious as to your thoughts as to what i should do next. i'm in my 20's, still a student (grad school). i have paid for a "proper" credit score (but do check my credit report annually). i use credit karma ("fako") and it tells me i'm at 720 (i was at 770 in sept, but i applied for 2 cards, amex-denied, and cap1-3K but now i read i shouldn't have applied for it). I have 8 hard pulls on my credit report currently. I've been denied by AMEX and the REI visa card. i don't have any loans/debt; i don't have any car payments; i rent (500/mo.) with an annual income of 30,000; my utiliziation is pretty low, around 10% and i always pay in full and never carry a balance. i don't know if i should be "gardening" or applying for another card (or two) that give rewards while i have the 8 inquiries already on my credit report...... here's what i'm working with (date opened) - Card - Credit Limit 09/2010 - PNC VISA - 8500 (just moved credit over to one and closed another from PNC) 12/2010 - Discover - 3000 05/2011- Citibank Platinum - 7500 05/2011 - Cap 1 - 3000 06/2011 - Chase Sapphire - 10000 what should i do now???? help! my goal is to get the best credit possible to be able to get the best mortgage rates possible (and car stuff). i also like the thrill of trying to get as high of a credit score(s) and credit limit as possible. i also want at least 1 more rewards card (i'm thinking either of the southwest cards, the rei card, any other suggestions?)

I think you should be gardening for awhile. You have alot of open TL's.

Re: 20's - How should I proceed?

flowfaster — Wed, 04 Jan 2012 22:47:51 GMT

Go to the garden club right now. That's what I suggest.

Re: 20's - How should I proceed?

Anonymous — Wed, 04 Jan 2012 23:10:51 GMT

I would garden and let some of those tradelines age and inquiries fall off. You have some great cards and lines!

Re: 20's - How should I proceed?

Anonymous — Wed, 04 Jan 2012 23:16:27 GMT

i know its fun to get what u want, but u look like u have enough, chill out

Re: 20's - How should I proceed?

Anonymous — Wed, 04 Jan 2012 23:51:15 GMT

lol, ok, i'll hang out and let things mature a bit........well, that was easy peasy.

thanks!!

any suggestions on 1 new card i could get with good rewards (with low or no AF)??

Re: 20's - How should I proceed?

Anonymous — Wed, 04 Jan 2012 23:55:59 GMT

amex

Re: 20's - How should I proceed?

LS2982 — Thu, 05 Jan 2012 00:31:20 GMT

@Anonymous wrote:
lol, ok, i'll hang out and let things mature a bit........well, that was easy peasy.

thanks!!

any suggestions on 1 new card i could get with good rewards (with low or no AF)??

AMEX is a good choice (Zync)

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 01:08:24 GMT

zync is a "charge card" right? how do credit bureau's take into account the expenditures per month for utilization?

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 01:18:03 GMT

@Anonymous wrote:
zync is a "charge card" right? how do credit bureau's take into account the expenditures per month for utilization?

i ran up 4k+ on it and let that report then PIF,, i believed it helped with later cards b/c u have to PIF every month,,, and the AF is only 25 bucks and u get in the door with amex

Re: 20's - How should I proceed?

LS2982 — Thu, 05 Jan 2012 01:34:35 GMT

@Anonymous wrote:
@Anonymous wrote:
zync is a "charge card" right? how do credit bureau's take into account the expenditures per month for utilization?

i ran up 4k+ on it and let that report then PIF,, i believed it helped with later cards b/c u have to PIF every month,,, and the AF is only 25 bucks and u get in the door with amex

So your Zync reports a 4k+ CL?

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 03:03:22 GMT

If all the information you gave us is correct, you don't have any installment loans. The presence of a charge card would actually help your credit scores as it would add to your credit mix. But looking at the big picture an Amex or any change won't do anything additional that your already impressive card collection won't do.

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 03:06:15 GMT

i ran up 4k+ on it and let that report then PIF,, i believed it helped with later cards b/c u have to PIF every month,,, and the AF is only 25 bucks and u get in the door with amex
So your Zync reports a 4k+ CL?

No CL for NPSL cards. Your credit report will show a high limit and that will be considered into your UTL on the version of TU Fico score (TU98) that can be purchased here at Myfico.com

Re: 20's - How should I proceed?

Revelate — Thu, 05 Jan 2012 03:08:52 GMT

@Anonymous wrote:
If all the information you gave us is correct, you don't have any installment loans. The presence of a charge card would actually help your credit scores as it would add to your credit mix. But looking at the big picture an Amex or any change won't do anything additional that your already impressive card collection won't do.

Go get a car loan, or some other installment type loan: furniture, secured cd even, etc. Your cards are more than fine; however, go diversify your trade lines if you want to achieve higher scores for the future.

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 03:22:49 GMT

@Revelate wrote:

+1

Go get a car loan, or some other installment type loan: furniture, secured cd even, etc. Your cards are more than fine; however, go diversify your trade lines if you want to achieve higher scores for the future.

so a CD would help? are there any other "simple" ways of getting diverse TL? i'm definitely not in the markey for a car or furniture or anything like that (e.g. big appliances).......

Re: 20's - How should I proceed?

Revelate — Thu, 05 Jan 2012 03:53:50 GMT

@Anonymous wrote:
@Revelate wrote:
+1

Go get a car loan, or some other installment type loan: furniture, secured cd even, etc. Your cards are more than fine; however, go diversify your trade lines if you want to achieve higher scores for the future.

so a CD would help? are there any other "simple" ways of getting diverse TL? i'm definitely not in the markey for a car or furniture or anything like that (e.g. big appliances).......

My fault for not being more clear in this case: you get a CD and then you take a 100% loan-to-value loan against it for the term of the CD.

To give you an example, USAA charges 2% interest above what you make for the given CD, so if you have a term of a year, and the minimum (in their case, is more or less in others) $2500, it's <$50 bucks (lazy math) to get an installment tradeline on your record. For that matter, you can take that cash, and turn around and immediately open another CD somewhere else and do the same process over again, now you have two tradelines open. This used to be the way to credit build back in the day, I don't know how it's fully scored currently and nobody so far offered a guess to my inquiry on benefit on a different forum here.

If you already have a car, get an installment loan secured against that.

If you want to get *far* more creative and you have spare income, you can do something like take an unsecured personal loan from a bank or other institution, just make certain they report.... just I would suggest depending on interest rate to pay probably half of it back first. You want the term of the loan to go at least six reporting cycles for seasoning.

Either way, to get an installment loan in your situation, you're basically going to have to take one that you don't need somehow, and it's going to cost you in initial deposit availability, and/or in interest depending on what your finances can afford. In your situation though, I'd probably suggest either the title loan or the secured CD loan, especially as you can extend the CD term out multiple years to cover the time while you're still in school and before you chase a house or auto loan in earnest.

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 04:58:49 GMT

see, this is what's wrong with the "system" today......no one told me about these financial instruments that can be used to help yourself out (in terms of using the borrowed money for something useful AND one's credit ratings)...........

if i take out a loan, wouldn't i be on the hook for the interest rate? so essentially i would be paying that interest "fee" to better my score? is there a way to do this without "losing" that money?

what if i took out a loan of some kind, got it on the "record," and then paid it back in full before any interest was charged? i guess the problem would be finding such a loan where i would be interest free for some period of time (e.g. 6 months)

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 05:09:26 GMT

awesome read, btw, for those that might be in similar positions of needing to build credit........such an awesome forum with great help/information.

http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/Store-Credit-Card-or-CD-Loan-and-a-delinquency-question/td-p/926890

Re: 20's - How should I proceed?

Revelate — Thu, 05 Jan 2012 05:24:21 GMT

@Anonymous wrote:
see, this is what's wrong with the "system" today......no one told me about these financial instruments that can be used to help yourself out (in terms of using the borrowed money for something useful AND one's credit ratings)...........

if i take out a loan, wouldn't i be on the hook for the interest rate? so essentially i would be paying that interest "fee" to better my score? is there a way to do this without "losing" that money?

what if i took out a loan of some kind, got it on the "record," and then paid it back in full before any interest was charged? i guess the problem would be finding such a loan where i would be interest free for some period of time (e.g. 6 months)

In a simple, single word: No

Lenders are in the business of making money. If you want to improve your credit, the only way to do that is to *use* some credit: vis a vis, probably giving some lender some money in the process. The system is somewhat of a scam I agree, but that's the game as it's setup and we don't have a lot of choice as I used to pay cash for everything, but I just can't afford to pay cash for a house out in S. Cali where I live now... and as such, well, here I go.

I don't know what you're studying for your masters or doctorate, but even academia is nowhere close to black in white in any field. On the one hand you can simply sit (garden as the forumites here call it) on your nice set of credit cards until you need to get some other type of loan: a car, or a mortgage, and you might find yourself somewhat more disadvantaged than you possibly could be.

Or you can make an investment now while you have spare income, for an amount which is trivial over the course of a lifetime for virtually anyone, and see about dealing yourself into the upper decks before you're on the hook for a truly big ticket item.

Really, it's a similar calculation as the lenders do, if I spend some money today: do I save (make in the lender's case) more money later? Unfortunately only you can answer that one with whatever your current personal value of money is, but if you're looking to maximize your score, you need to get some different types of debt on the record... and unfortunately turning around and paying a loan right back, is nowhere close to the optimal method of doing that.

Personally I think spending 2% of interest on a $2500 loan if it changes my APR on a 600k+ 30 year mortgage by a fraction of a percent, is an investment paid hundreds of times over; however, you're in a different place and time in life than I am, but I'd recommend you learn from my mistakes and start maximizing your credit now, than when you really need it.

Re: 20's - How should I proceed?

Anonymous — Thu, 05 Jan 2012 05:23:48 GMT

@Revelate wrote:

This used to be the way to credit build back in the day, I don't know how it's fully scored currently and nobody so far offered a guess to my inquiry on benefit on a different forum here.

Apparently, this is no longer the case. Revolving credit is the important scoring factor now. And, while FICO says that the different types of credit taken into consideration only counts for 10% of the score, the reason for "revolving credit" to be more predominant is, from what I understand, because of utilization. The ability to use revolving credit utilization to spike your credit score for maximum scoring points gives "credit cards" the leading edge.