topic Re: What to do... in Credit Cards

What to do...

gohoosiers05 — Sat, 25 May 2013 05:36:29 GMT

Was curious what you guys think I should do to get to some of the higher tier cards. I can pay $1,300 in rent online every month through anything but amex or discover, and probably favor a rewards (specifically travel) card. I'd prefer a statement credit for any travel type card over an airline specific card.

I have 1 card now, mainly because I've never really needed credit and relied on cash. Its the same USAA I've had since I started college 8 years ago, and I've never needed or tried to up the $1,700 limit. Right now I'm a grad student, with ~15k income from the summer but from family with money I wouldn't have a problem repaying any credit I would use and I don't pay the debts I have now. (After rewriting that 4 or 5 times I'm convinced there is no way to say that without sounding like a spoiled ass. Sorry, not my intention.) In a year I'll be entering a profession where $80,000/yr would be a very conservative estimate for someone in their first year. (Wow, again with the spoiled tone.)

I think my case is a little interesting. Here's why:

When I was 20 I got a Chase card with over $10,000 CL (without telling the people who would pay it back if I couldn't), so I know there is (or was) some reason that credit card companies believe I can pay off debt. From reading around these boards I know this high of a CL at such a young age is uncommon, but I'm not sure how uncommon. If it is so uncommon that people doubt it, which is understandable, know that I have absolutely no reason or interest in lying to strangers and asking their opinion. So please, even if you doubt this is true, I'd appreciate advice on what I've said. Thanks. Anyway, after turning 21 I started acting like a 21 with a huge credit limit. I ran up about $5,000 in a summer, was paying minimums, and "missed" a payment that posted a day late. I was (thankfully) bailed out of this, but learned my lesson, I swear. The account was closed, and that is the only late payment I've ever truly had and the only late payment currently on my report (more on this later).

Part of learning my lesson meant I have completely stayed away from credit cards, but now that I'm more responsible and working to be more financially independent, I'd like to start raising my 3 year, 3 month credit history as soon as possible to help my score for the typical big purchases in the future. The $1,700 limit I had when I was 18 hasn't been increased and I haven't requested it. Right now there is $1,000 on there, which is completely dinging my utilization. I don't really use the card and don't personally pay the balance, so I'm not in much of a position to request that it be paid off. I could pay it off myself, but honestly would rather invest that cash than use it to raise my credit score. I could do a CLI request, but if it just to get higher CL on other cards I don't think it'd be worth the HP for me, personally.

I have $16,000 in grad school loans currently in deferment. Unfortunately, the lender screwed up and put the loan in repayment the day after it was dispersed in the fall of 2011. In November I got a call that I was 3 months late. I called and was told it was sorted out, but it wasn't. Again in February I was told I was 6 months late. I called and again, we worked through the problem and I was given evidence it was corrected. Except somehow they never made the correction with the credit agencies. I actually signed up for FICO earlier this year when I pulled a credit report and was shocked at how low it was. Thats when (a year later) I discovered this error. Through a dispute it appears to have been corrected, and has gone up 30 points to where it is. This bump happened earlier this year in case previous scores matter.

So, to recap:

-710 FICO

-3.25 yrs credit history (1 card, 1700 limit, ~60% utilization, had 1 other card, paid in full and closed in college)

-1 inquiry in 2011 (apartment rental company)

-26 years old

I know this is a long post for these boards, so I appreciate you guys taking the time to read it and weigh in. Thanks!

Re: What to do...

gohoosiers05 — Sun, 26 May 2013 20:26:00 GMT

bump.

any suggestions?

Re: What to do...

myjourney — Sun, 26 May 2013 20:34:35 GMT

Welcome to the forum

Chase freedom may be the card for you however with only 1 card @ 60% UTL ....kind of high

You may want to pay down if possible before any app's

Re: What to do...

n777ua — Sun, 26 May 2013 20:37:27 GMT

1 inq? Go on an app spree and see what you get....

Re: What to do...

Creditaddict — Sun, 26 May 2013 21:12:09 GMT

@n777ua wrote:
1 inq? Go on an app spree and see what you get....

I agree - hit up the pre-approval links on each bank... Bank of America, Citi, Chase, Discover.... The Citi and Chase I find to be true good offers... Creditcards.com was a good true offer for my partner with Amex Blue Cash Preferred.

I would ask for the increase with USAA but probably after applying for a bunch of new things just because if they care about INQ, who cares because you will have newer and better cards probably... I wouldn't worry about the util that much since it's your only card, it would be hard for it to be at a low util unless you were someone who really knows (you do) but the average person that has always just had one card... I think just having the good history, many banks will look past the higher util.

you may not want or need a full on app spree but I would add at least 2 more cards but probably 3.... a Citi, Chase, Amex but up to you.

Since you have rent to pay you could easily make any opening bonus... Barclay rewards one has like a $250 cash bonus or something really good right now if you spend $500 or something.

Blue Cash preferred if through creditcards.com is also $200 or $250

chase has some 40k point or more bonus type things that could then convert to cash and gift cards worth more than $100 i think

same with citi for hotel or other type cards

discover has a $50 refer a friend or maybe even $100, id be happy to refer you if you need, just pm me

Re: What to do...

gohoosiers05 — Sun, 26 May 2013 21:18:22 GMT

Thanks for the input, guys.

Pre-approval links aren't hard inquiries, correct?

My concern with the high utlization isn't that banks will ding me for the high utilization itself, but instead how the high utilitization negatively affects my credit score.

Re: What to do...

Creditaddict — Sun, 26 May 2013 21:22:02 GMT

@gohoosiers05 wrote:
Thanks for the input, guys.

Pre-approval links aren't hard inquiries, correct?

My concern with the high utlization isn't that banks will ding me for the high utilization itself, but instead how the high utilitization negatively affects my credit score.

no the pre-approvals do not go on your credit that others see or effect your score....

you won't know how it will effect you until you apply... start with citi, I think you will be happily surprised and want some more!

Re: What to do...

SRAGS — Sun, 26 May 2013 21:26:51 GMT

Bring down UTI to below 25 %... and app for discover. if you are not approved call back door number. Thanks.

Re: What to do...

myjourney — Sun, 26 May 2013 21:27:03 GMT

@gohoosiers05 wrote:
Thanks for the input, guys.

Pre-approval links aren't hard inquiries, correct?

My concern with the high utlization isn't that banks will ding me for the high utilization itself, but instead how the high utilitization negatively affects my credit score.

If you can get UTL down you stand a better chance of higher approvals and greater limits

Re: What to do...

gohoosiers05 — Sun, 26 May 2013 21:42:30 GMT

Can you read much into app success from the pre-approval offers?

Re: What to do...

myjourney — Sun, 26 May 2013 21:44:23 GMT

@gohoosiers05 wrote:
Can you read much into app success from the pre-approval offers?

NO 50/50 chance

Re: What to do...

n777ua — Sun, 26 May 2013 22:39:13 GMT

I think you're WAY too concerned about the inq's here. If you already had 10...sure it would be a problem. But you have 1, on one CR I assume. So its entirely possible your first app will show zero inq's depending on the CA pulled. And your util is high, but I suspect having a $700 balance on a $2000 CL is different vs say, a $7000 balance on a $20000 CL when manually reviewed. Just my $.02.

Oh, and don't app here and there over a few days, if you're going to do it, get all your ducks in a row and app on the same day. There are countless threads on how to do this on other sites (and probably buried here somewhere)

Also, an Amex revolver can be hard to get, but after a couple of years they are extremely generous with the CL's (just to get you thinking longer term)...

Re: What to do...

Creditaddict — Sun, 26 May 2013 22:56:06 GMT

Who did you get pre-approved for and what is the offer??

I'm kind of getting irritated with how everyone turns their nose up on these pre-approvals... I understand much confusion and some sly moveds by some of the banks in pre-approved vs. suggested or type wording and not getting approved but many of these sites when you are getting TRUE pre-approvals not the suggestions like capital one does or the regular every day like Bank of America, Discover has a true pre-approval (you just don't see it often) and both citi and chase and the amex offer from creditcards.com were instant for my partner online.

Re: What to do...

LS2982 — Sun, 26 May 2013 23:10:10 GMT

@SRAGS wrote:
Bring down UTI to below 25 %... and app for discover. if you are not approved call back door number. Thanks.

Bring your util. down to below 15% then do your spree. Your going to get low ball approvals right now.