topic Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo? in Credit Cards

which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

kittywitty — Tue, 12 Aug 2014 21:00:02 GMT

wells fargo says the $3,000 secured loan would report to all 3 bureau's and so would the secured credit card so is one better for the score then the other. I really have no interest in owning a credit card but if it will save me money on a car then i suppose i can try it since i have no other credit activity besides a $490 collection which i am not so sure to pay or not. i am looking for the quickest way to raise my score. my scores are between 600 & 650.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

Anonymous — Tue, 12 Aug 2014 21:23:42 GMT

My 2 cents worth. Similar circumstances and Wells Fargo put me into a secured Visa and a Note Loan of $3,000 (charged me $50 for writing the loan) and held $5,000 worth of CDs as security. When it was done they did NOT graduate me from their secured card and the credit bureaus rapped me for having a Note Loan (can't see where it actually hurt my score). End result I closed my Wells Fargo checking/savings, insurances and investment accounts too. Moved all of the products to other financial institutions and got real unsecured products. Wells Fargo blacklists and was not going to extend me any credit so I left. Your situation may be different so you have decisions to make. Had a BK7 (Business) in 2001.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

CreditDunce — Tue, 12 Aug 2014 21:38:07 GMT

In the short term (less than 6 months) the new TL's will hurt your score. Sometime after 6 months and less than 2 years it will help. There is no quick fix to building a good credit score.

Note, if you have to choose one or the other, the CC's would be better. A new autoloan will count as an installment loan. FICO wants to see both installment and revolver on your credit report.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

taxi818 — Tue, 12 Aug 2014 23:17:12 GMT

Credit dunce wrote

If you are going to get a secured installment loan, get the smallest you can. ($500?). FICO doesn't care and it will cost you less interest. In addition, you should probably get 2-3 CC's. I would probably look at BoA if they will approve you since they will give you your money back after 1 year and let you keep the CC. In the short term (less than 6 months) the new TL's will hurt your score. Sometime after 6 months and less than 2 years it will help. There is no quick fix to building a good credit score. Note, if you have to choose one or the other, the CC's would be better. A new autoloan will count as an installment loan. FICO wants to see both installment and revolver on your credit report.

I agree 500 will do. My score started in dec2013. Was 615. Now tu 708. I got 2 secured credit cards. And 1installment loan. Never missed. Score shot up. 1 paid collection. 4 years old. Was unpaid. When I did pay. I lost 53 points. Now back to 708.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

kittywitty — Tue, 12 Aug 2014 23:45:12 GMT

santee cooper credit union has $500 secured loans but they only report to equifax. i quess that is better then nothing. the car lot i am looking into uses equifax. inquires shouldn't hurt me much as one or two are dropping off soon so i'll only have the car loan i recently refused at 13%. i have a closed by bank chase visa for 8 years with only 3 lates total. a paid off 20,000 car loan with 15 out of 75 payments late. i also have a $28,000 truck loan from my husband that shows as paid with no lates, it was a joint account and he traded it in after about 2 years. paid everything but a lousy $300 toys r us credit card now in collections. i am really annoyed as the card was pushed on me in the store. i went there with $300 cash to make a purchase and they talked me into their dang card to save a lousy %10 now that my car was ruined in an accident i am unable to replace it. don't get me started on the used car lots around here. that's not going to happen i'd rather go without a car. i think i would rather get $500 loans pay off and repeat. i think the credit card would take too long to see any benefits where the loans i could pay off quickly. should i keep disputing the collection or should i quit so they will try to settle? gee i'd love to settle but all my money is tied up in secured loans right now, now give me a pfd and i will consider. lol

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

CreditDrama85 — Tue, 12 Aug 2014 23:51:06 GMT

Wells fargo is okay. As previously stated they are not the best about unsecuring accounts. I actually had an account with them and they closed it and refused to apply the security deposit to the balance. After closure I let the account report late on purpose and they eventually applied the security so if you go this route I recommend only a small amount. The note loan with fixed payments where you get your $ back with interest might be the best.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

taxi818 — Wed, 13 Aug 2014 00:27:05 GMT

You need to study here at my fico. The credit card as you say will not help. Are you kidding? Revolving credit is huge with my fico. Utilization counts for 30 percent of your score. Which you can only get from credit cards. Installment loan gives you a mix if credit. But other than pay history. Credit cards are the biggest thing for your score. Just do the research here. Don't guess at it. We are here to help you. Beleive it.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

CreditDrama85 — Wed, 13 Aug 2014 00:50:38 GMT

I agree credit cards are huge because they count for 30% but maybe OP should do both since they are looking for an auto loan in the future. Paying the secured installment loan will probably yield a stronger auto enhanced and it will show ability to make fixed monthly payments on manual review.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

taxi818 — Wed, 13 Aug 2014 00:52:17 GMT

I agree. Should do both. Which I recommended. Don't put 3 k on loan only. Put maybe. 1 k on loan. 509 each in credit card. And let it ride. IMO.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

taxi818 — Wed, 13 Aug 2014 00:52:44 GMT

Meant 500 each.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

kittywitty — Wed, 13 Aug 2014 01:45:56 GMT

i would think my score would increase if i pay anything on time. all my late payments are dragging my score down. oh i get it i see how a credit card would help by giving me available credit. wells fargo told me it would cost $25 for the credit card and after a year they would unsecure it. my car loan was with wells fargo dealer services and i have a local wells fargo bank so that is why i called them. i have a small business and have been paying everything with my paypal card which only gives me 1% cash back and nothing towards my credit score so i was thinking i deserve credit for my spending by using credit instead of paypal. i have been reading up on this site trying to figure out how i can increase my score. after paying my debts and still having a collection the last thing i wanted was another credit card. i actually enjoy having no debt so i'm not in a hurry to get another car but i don't want to wait a year either. i want to pay the lowest interest i can possibly get so i will be able to pay my payments on time. 10% was too much wells fargo made $10,000 in interest.. i'm not willing to pay that again.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

CreditDunce — Wed, 13 Aug 2014 15:18:40 GMT

@kittywitty wrote:
i would think my score would increase if i pay anything on time. all my late payments are dragging my score down. oh i get it i see how a credit card would help by giving me available credit. wells fargo told me it would cost $25 for the credit card and after a year they would unsecure it. my car loan was with wells fargo dealer services and i have a local wells fargo bank so that is why i called them. i have a small business and have been paying everything with my paypal card which only gives me 1% cash back and nothing towards my credit score so i was thinking i deserve credit for my spending by using credit instead of paypal. i have been reading up on this site trying to figure out how i can increase my score. after paying my debts and still having a collection the last thing i wanted was another credit card. i actually enjoy having no debt so i'm not in a hurry to get another car but i don't want to wait a year either. i want to pay the lowest interest i can possibly get so i will be able to pay my payments on time. 10% was too much wells fargo made $10,000 in interest.. i'm not willing to pay that again.

I understand completely about not wanting to be in debt. I sleep much better without any debt. You have to use credit to have good credit. But, credit is not debt.

If your credit union does not report to all three CRA's, I would find another for a secured installment loan. For example, SDFCU (State Department FCU) can be joined for free through the ACC association. Deposit $550. Ask for a four year $500 secured loan. They mark $500 as unavailable in your account and give you $500. Setup AutoPay to take care of the payment each month. In 6 months to a year, your credit score will improve.

When you are ready to buy a new car, be sure to check their auto rates in addition to your local CU and places like DCU.

As others have said, FICO 08 punishes people without any credit cards. In your case, credit cards will boost your credit score more than an installment loan. I would highly recommend applying for at least one secured credit card. SDFCU also offers secured CC's without a HP. No AF, but it doesn't graduate either.

I know you had a bad experience with store credit cards, but you might be able to get one without an AF. Khols is known for easy approvals. If you want to avoid HP's, search myfico for the shopping card trick. A shopping card trick card with relatively easy approvals is Victoria Secret. Again, I would only get one store card and only if you shop there. And only use the credit cards if you can pay the full amount when it is due.

It should go without saying, but it is critical, you pay on time every month. No exceptions. I would go as far as to say you should pay in full every month. Otherwise, you will pay a very high interest rate and the new accounts will not help you.

Lastly, you mentioned you had an account in collections. I don't know that much about how collections, etc work. I would recommend you read up in the rebuilding section. However, I believe your best bet is to contact the CA and offer to pay for delete. If they accept, the collection will be deleted from your credit report. Potentially giving you a big boost in score. The other baddies may put a ceiling on how high your credit score can climb. However, any baddy you can remove will help a lot.

Good luck.

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

kittywitty — Wed, 13 Aug 2014 16:30:49 GMT

i have asked for pfd and they will not. i just open a 5 month loan with santee cooper credit union and a savings account and they payments will come out of the savings account. they didn't even have to pull my credit. i might pay if off early i hate to wait 6 more months. they do auto loans as well and said i need about a 640 to get a decent rate so i'm not that far off. i think i'll look for another credit union and do the same. thanks for all the help everyone

Re: which is better wells fargo secured credit card or $3,000 secured loan from wells fargo?

sjt — Wed, 13 Aug 2014 23:23:41 GMT

@kittywitty wrote:
wells fargo says the $3,000 secured loan would report to all 3 bureau's and so would the secured credit card so is one better for the score then the other. I really have no interest in owning a credit card but if it will save me money on a car then i suppose i can try it since i have no other credit activity besides a $490 collection which i am not so sure to pay or not. i am looking for the quickest way to raise my score. my scores are between 600 & 650.

You might also consider WF Portfolio Line of Credit, which is a secured line of credit.