topic I recently got approved..... in General Credit Topics

Credit Card Advice

Anonymous — Thu, 15 Mar 2007 21:55:16 GMT

OK, I have a Capital One credit card with a $5,000 balance. Over the last six months I've paid nearly $3,000 on it but was late 3 times by days and over the limit twice which is Capital One's 5 strike and you're out policy. I had a 14.9 % APR, now it turned to 28.15%.

My question is this, I've called Cap One and they won't budge even though the last payment was only 6 days late. Mind you my wife has been off work for several months (Had I called and warned them I wouldn't be in this mess).

Anyway, would I be better off going to my CU and getting a personal loan to pay off the card (my only card I still owe on) or should I eat the interest rate and make regular 'timely' payments? I just hate paying interest when I could be paying principal.

Please advise!! Thanks

If I was in your shoes I would get the balance to the low...

Anonymous — Fri, 16 Mar 2007 00:15:59 GMT

If I was in your shoes I would get the balance to the lowest interest rate I could. Why even consider leaving it at 28% if you can move it to a lower rate? (maybe you have legit reason - but I can't think of any) The late payment damage is already done - letting them gouge you isn't going to help.

The fine print on this credit card states the APR will ch...

Anonymous — Fri, 16 Mar 2007 01:02:38 GMT

The fine print on this credit card states the APR will change to 28% if the 5 events happen. It cannot be lowered. Thus the question, get a personal loan and pay that off at a lower APR, or just deal with the CC APR @28%. Which is better, opening new credit or and showing the payoff of the credit card or dealing with the higher credit APR on the CC so as to show regular payments and no additional credit checks needed to get a personal loan? Which is the better way to go? Obviously money wise, it would be smarter paying the smaller interest on a personal loan but what kind of affect can I expect to my Fico for either way? Thanks

Ohh...I see, sorry I misunderstood (I thought maybe you a...

Anonymous — Fri, 16 Mar 2007 01:11:41 GMT

Ohh...I see, sorry I misunderstood (I thought maybe you already had another open account at the CU you could take a loan from). If I understand correctly, you are concerned with the impact of opening a new account with the CU (or ther bank) in order to reduce the rate.

That's a tough one. A balance is a balance, so my initial thought is that it won't hurt too bad. If it was me, I would take any little hit of a new account in order to get the balance to a lower rate. Every time you do something it has an affect on your score, but the biggest impact is how much you owe.

So, having the balance itself is probably a bigger issue than a new account. Keeping the balance at 28% will take longer to pay off - thereby keeping the balance on your credit longer. I would probably open the new account - but this is just personal, not legal, advice.

Message Edited by DionLawOffice on 03-15-2007 06:10 PM

Message Edited by DionLawOffice on 03-15-2007 06:11 PM

I recently got approved.....

dlm0820 — Fri, 16 Mar 2007 02:12:01 GMT

for a Cap One card (which seems to be the only thing I can get now). I don't know what the limit is yet, but I'm sure it's low. I've heard so so many bad things about Cap One, that I'm wondering now if I made a mistake. I surely would like to have another credit card on my report, but from what I understand Cap One doesn't report your credit limit to the CRA's. LakeEire, Your limit is pretty high with Cap One.

If I may be so bold, how do you like using the card so far and what, if any affect has their reporting done for your score seeing as how they only report high limits?

Thanks

Message Edited by dlm0820 on 03-15-2007 07:12 PM

Hi DLM, Cap One has actually been decent. I've had the...

Anonymous — Fri, 16 Mar 2007 02:33:30 GMT

Hi DLM,

Cap One has actually been decent. I've had them for years. I lost my job about 3 years ago and at that time I had three cards from them. (5K, 1K and 500). I ended up having to use my cards and I maxed all three of them paying bills and just getting from month to month. I consolidated the three cards into one a couple years ago. I was able to reduce the APR on two of the cards by going with one single card. 14% didn't seem too bad at the time.

Where I got into trouble was having 5 events in about three months. I'm not sure what the details were I think 5 in six months puts you in a new category (bend over category)!! I was paying using webpay online, but a couple times the payment didn't post on the date required. It was a couple days late, then I would get a past due fee (1 event). I also have an over the limit fee (another event). In total, I had 5 events in three months.

I made $2,900 in payments over the course of 6 months (in 6 payments) but many (3) weren't on time. Toss in Christmas and my wife being off work medically and everything fell apart. In the mean time, I was able to pay off a high interest Orchard bank card (29%) first. I gave that one priority and resources. Well, now I have the same issue with this card and Cap One's customer service was awful to deal with. I spoke with them and I talked with 'Ginger'...I remember her well. Talk about the most impolite, uncooperative person I've ever spoke with. It was horrible.

My advice on the Cap One card? Pay on time and as much as you can. Keep track of your events (Late Fees, Over Limit Fees) on your statements. If you get close to five...look out!!

I'm probably going to take my credit reports to the Credit Union and talk with a loan officer. I am living in a lease to own home (leased because I wasn't sure about employment stability) and the lease is up in June. I have my truck loan through them and I've never been late on a now two year old note. My lease payment goes to a fellow credit union member and is electronically transferred to them every 3rd of the month....never missed a lease payment in about 13 months.

I'm hoping I can show the credit union the timely payments for both my truck and my house lease as well as show them I only have one credit card left. Since I lost my job in 2003, it's been a painful struggle, but I'm getting close. I had a bankruptcy in 97 which will fall off next month. It's been so difficult and other than this one card, I've been steady as a rock. Hopefully the CU will take direct deduction for a home loan from my paycheck. So far they've been working for me.

Thanks

dlm0820 — Fri, 16 Mar 2007 02:41:53 GMT

for the advice. I hear you about the hard times. I came into a few of them myself and made some dumb mistakes in college and soon after. I thought that credit was a given and I used and abused it. I'm suffering for it now. Anywho, I have a Household bank card that I pay on time every month and have a decent limit on it. It's steadily been going up which is fine by me. As for Cap One, well, we will see what happens with that. I use online banking to pay for everything and Cap One will be no different. I always pay early too. I just hope that by them not reporting the credit limit, it doesn't hurt me. That is the last thing I need.

Good luck to you and I hope all works out well. Thanks for the reply, I appreciate it.

According to a rep at Cap One, they will begin to report...

Anonymous — Fri, 16 Mar 2007 02:55:40 GMT

According to a rep at Cap One, they will begin to report limits by Septmeber of this year. Not reporting limits does hurt your score as your card looks maxed out. The onyl way to overcome this, bcause they do report high balance is to max the card out and then pay it down. I don't max cards out...period. I BT'd it up to the limit when I opened it and paid it off before it reported. I'll see what's actually shaking in Sept and decide whether or not to keep the card. I only use it for McDonalds and pizza now and PIF at the end of the month.

I find it irritating that they don't report regularly either. My statement date is supposed to be on the 12th and as of today ther website has still not updated with the new statement. I like to pay online the day fter statement but with the way they post who they heck knows when that truly is.

Message Edited by Brammy on 03-15-2007 10:55 PM

Good luck back at ya

Anonymous — Fri, 16 Mar 2007 02:53:53 GMT

Paying online is a great way to go. In my situation the Cap One bill comes in and there's a due date on it. If I don't move it to the pending payment side before the 'processing' time required date, it goes late. Had I been smart, I would have just gone directly to Cap one's site and did it there, but I didn't.

My wife used to take care of all this but she had a medical problem which took her completely out of the loop. I've basically started from scratch because I had no clue where things were at. I now have everything under control, but I'm looking for areas where I can improve things. In a way, I'm glad I'm responsible for it now. I know what's going on and I can see where changes need to be made.

In the past, I was just too lazy to deal with things. I hate balancing a check book and hate paying the bills. Other than the normal hundreds of dollars I spend to pay medical bills every month, I have everything else now setup through my online banking. Learning day by day. I wish I would have done this 10 years ago.

Brammy, did you get my email?

Anonymous — Fri, 16 Mar 2007 02:59:43 GMT

Did you get my message I sent this afternoon?

Thanks Brammy

dlm0820 — Fri, 16 Mar 2007 02:59:48 GMT

for that bit of news. I heard that they were going to start reporting limits but not until 2008. Hopefully you are right and it is sooner. That would really help me, especially if I somehow managed to get a card that had more than $300 on it. For now I guess, I'll have to live with my Household Bank and Cap One card. It's a start I suppose and maybe in a couple of years when stuff starts to fall off, I'll be able to get a "real" card.

Lake, CU's are usually pretty good to their members, so...

Anonymous — Fri, 16 Mar 2007 13:44:53 GMT

Lake,

CU's are usually pretty good to their members, so since you already have a positive history with them they should approve you. BUT - please be careful. Credit unions often require you to "cross-collateralize" with other accounts you have with them. That means they can take your car if you fall behind on any other accounts. If they force you to cross-collateralize in order to get the new loan for the credit card you may want to think twice. If you have any equity in your car, sign a cross-collateral agreement for the new loan, and fall behind on that new loan, then they will go after your car. So, look at the "fine print" or any separate agreements they put in front of you.

*not legal advice