topic Re: Proper Use of Credit Cards for Rebuild in Rebuilding Your Credit

Proper Use of Credit Cards for Rebuild

Anonymous — Mon, 20 Apr 2015 22:02:41 GMT

Somehow, I was approved for a Cap1 QS One card. They actually approved me twice and sent 2 different cards with a $500 CL on each. My main question is how do I use these so I can reap the credit benefits properly while still accumulating rewards? I'd like to get the maximum benefit from the cards to help build my credit. Do I use and pay immediately leaving only a 20% or less utilization at statement time? Do I use one and drawer the other? Do I ask Cap1 to combine the CLs and close one out? Please help me out as I don't want to ruin what I've been working so hard to accomplish!

Thanks in advance.

Re: Proper Use of Credit Cards for Rebuild

gdale6 — Mon, 20 Apr 2015 22:25:06 GMT

You can use both to the limit if you want or even push much more thru with multi payments in a month. I used to shove 2.5K thru a 500 CL Cap-1 each month. You just want to be sure only 1 card reports a balance of no more than 9% of its CL to the CRAs each month, all others at 0.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Mon, 20 Apr 2015 22:57:53 GMT

Exactly like Gdale said - charge it up, pay multiple times each month. Make sure its paid down before the statement close date, pay one in full, the other let $20 or so carry past the statement date. With Cap One the Statements close three days after the Payment Dues date. Register online and link both accounts along with your checking account so you can do online payments right from the website.

AFAIK, Cap One will not combine two accounts into one.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 12:05:17 GMT

So is it safe to just drawer one of them or do I have to use each one at least once a month? I don't mind only using one of them and leaving the other in the house. I am mostly interested in getting the credit benefits for now.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 13:04:12 GMT

I'm in the same predicament. I don't have the income to charge - pay - charge - pay. I'm going to leave the one with an intro APR with a minimum payment for a few months and charge Netflix to it monthly (just to have activity), and use the other for gas purchases and pay biweekly.

You get better results from following the suggestions above, but if your income doesn't allow it, it won't do much good for rebuilding.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 13:13:36 GMT

@Anonymous wrote:
I'm in the same predicament. I don't have the income to charge - pay - charge - pay. I'm going to leave the one with an intro APR with a minimum payment for a few months and charge Netflix to it monthly (just to have activity), and use the other for gas purchases and pay biweekly.

You get better results from following the suggestions above, but if your income doesn't allow it, it won't do much good for rebuilding.

Rule number one of credit card use: if you can't afford it, don't buy it. My issue isn't with affordability - it's with making sure I get the most out of the card from a credit perspective. If you have a card, use it for something you would normally use your debit card/cash for and pay it off ASAP leaving only a small balance at reporting time (9% from what I've been reading). The two cards is what is throwing me off. I'm trying to figure out if I need to use both in order to get the credit bumps from it.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 14:18:56 GMT

@Anonymous wrote:
Rule number one of credit card use: if you can't afford it, don't buy it. My issue isn't with affordability - it's with making sure I get the most out of the card from a credit perspective. If you have a card, use it for something you would normally use your debit card/cash for and pay it off ASAP leaving only a small balance at reporting time (9% from what I've been reading). The two cards is what is throwing me off. I'm trying to figure out if I need to use both in order to get the credit bumps from it.

To get the maximum return on your cards, you need to keep them both active and in heavy use (with little reporting on one, and none on the other). Heavy use seems to give many creditors an incentive to give a CLI.

The advice to charge-pay is often repeated as dogma, though, so I was simply chiming in that there are other ways to approach it and still reap benefits.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 14:49:56 GMT

@Anonymous wrote:

To get the maximum return on your cards, you need to keep them both active and in heavy use (with little reporting on one, and none on the other). Heavy use seems to give many creditors an incentive to give a CLI.
The advice to charge-pay is often repeated as dogma, though, so I was simply chiming in that there are other ways to approach it and still reap benefits.

Thanks for the input. CLIs are only important to me from a UTI standpoint. I am working on my "fiscal responsibility" so I'm not sure I want a huge CLI out there which equates to nothing more than a rope with which to hang myself! A mortgage in the next 18 months is my ultimate goal...

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 14:51:07 GMT

You can do that, you'll just get better CLI's if you use the card a lot. Do they have staggered due dates, or the same due date? I pretty much put all of my household expenses through my credit cards, with the exception of my rent.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 15:03:17 GMT

@Anonymous wrote:
You can do that, you'll just get better CLI's if you use the card a lot. Do they have staggered due dates, or the same due date? I pretty much put all of my household expenses through my credit cards, with the exception of my rent.

I just got them both yesterday, so I am not sure about the due dates yet. I imagine they would be the same if they were issued on the same day, but I could be wrong.

Re: Proper Use of Credit Cards for Rebuild

creditstalker — Tue, 21 Apr 2015 15:20:48 GMT

@gdale6

9% of the combined balances? Or 9% of that one particular credit card?

Thanks!

Re: Proper Use of Credit Cards for Rebuild

gdale6 — Tue, 21 Apr 2015 18:25:40 GMT

@creditstalker wrote:
@@gdale6
9% of the combined balances? Or 9% of that one particular credit card?

Thanks!

The answer is in red and all other cards at 0

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Tue, 21 Apr 2015 21:04:01 GMT

Register on the Cap One website, and link your cards and your checking account for making online payments. Once they are linked you can see the relevant dates. If they have the same due date, request one of them be moved back two weeks. That way you can use one card for household expenses, groceries, gas, until 4-5 days before the due date comes up. At that point, you stop using it, and start using the other card. You pay the first one before the statement date, which is three days after the due date. You should let one of them carry a small balance of ten dollars or so.

Re: Proper Use of Credit Cards for Rebuild

keepwhattime — Wed, 22 Apr 2015 01:26:57 GMT

JayRhom I got two Capital one cards on same day a month ago, they have different due dates.If you go online and link your cards easier to manage. I learned the hard way advice given is right stop using the cards 5 days out from your cycle closing date. I thought I was safe had paid down prior to closing date. Capital One never posted my last two charges until my cycle date end, which was to late to make a payment, and that is what got posted to CR. So my UTI was at 35%.

I did find out my cycle dates from sending capital one support an email and they responded in a day.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Wed, 22 Apr 2015 15:13:20 GMT

Thanks for all the advice. I linked the cards, but still don't see any date information as of yet. I'm sure that will populate eventually.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Wed, 22 Apr 2015 15:17:20 GMT

It may not show until your first statement is cut.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Wed, 22 Apr 2015 15:19:43 GMT

@Anonymous wrote:
It may not show until your first statement is cut.

In that case, I'll keep the usage fairly low for the first month so I know what the dates are going to be before I screw this opportunity up. Thanks again.

Re: Proper Use of Credit Cards for Rebuild

Anonymous — Wed, 22 Apr 2015 15:25:11 GMT

With my wifes new account, it looks like the first statement closed out a few days (3 days from the looks of it) after activation of the card, and ten days from the actual opening of the account, according to the statement.