@Anonymous wrote:
Hi - I’m in the process of rebuilding. I’ve been setting my intention on some major cards in 2019
. The discover card being ones. I was preapproved for the discover it secured.
My question is ... what’s the benefit of getting a secured card and hoping to graduate after 7 months or so versus gardening working hard to pay off debt and remove baddies and apply for an unsecured card when scores improve
Establishing good credit history is a must if you truly want to rebuild. You can remove baddies all day but if you don't replace them with positive credit history your score isn't going to improve nearly as much as it could. Major lenders (especially chase) will be hesitant to give you credit with no positive payment history showing (or any history), even with a clean slate. Also, having three revolving accounts open gives you "free" FICO points towards your overall total. I'd get the Discover secured, let a small balance post then PIF each month. After six months if working on baddies, your score should be improved enough to get an unsecured card if you don't want a second secured card.
@Anonymous wrote:
@Adkins wrote:
@Anonymous wrote:
Hi - I’m in the process of rebuilding. I’ve been setting my intention on some major cards in 2019
. The discover card being ones. I was preapproved for the discover it secured.
My question is ... what’s the benefit of getting a secured card and hoping to graduate after 7 months or so versus gardening working hard to pay off debt and remove baddies and apply for an unsecured card when scores improveEstablishing good credit history is a must if you truly want to rebuild. You can remove baddies all day but if you don't replace them with positive credit history your score isn't going to improve nearly as much as it could. Major lenders (especially chase) will be hesitant to give you credit with no positive payment history showing (or any history), even with a clean slate. Also, having three revolving accounts open gives you "free" FICO points towards your overall total. I'd get the Discover secured, let a small balance post then PIF each month. After six months if working on baddies, your score should be improved enough to get an unsecured card if you don't want a second secured card.
This always confuses me. What does that mean? So If my balance is due on the 28th of each month. Don't pay it all off just pay most of it and let the statement closes?
Exactly. Say your credit limit is $200. You spend $150. Before the statement cuts, you pay $140, so $10 actually cuts and posts to the statement (which is sent to the CRAs). Utlization is the next most important part of your score after credit history. A low utlization keeps your score higher.
@Anonymous wrote:
@Adkins wrote:
@Anonymous wrote:
@Adkins wrote:
@Anonymous wrote:
Hi - I’m in the process of rebuilding. I’ve been setting my intention on some major cards in 2019
. The discover card being ones. I was preapproved for the discover it secured.
My question is ... what’s the benefit of getting a secured card and hoping to graduate after 7 months or so versus gardening working hard to pay off debt and remove baddies and apply for an unsecured card when scores improveEstablishing good credit history is a must if you truly want to rebuild. You can remove baddies all day but if you don't replace them with positive credit history your score isn't going to improve nearly as much as it could. Major lenders (especially chase) will be hesitant to give you credit with no positive payment history showing (or any history), even with a clean slate. Also, having three revolving accounts open gives you "free" FICO points towards your overall total. I'd get the Discover secured, let a small balance post then PIF each month. After six months if working on baddies, your score should be improved enough to get an unsecured card if you don't want a second secured card.
This always confuses me. What does that mean? So If my balance is due on the 28th of each month. Don't pay it all off just pay most of it and let the statement closes?
Exactly. Say your credit limit is $200. You spend $150. Before the statement cuts, you pay $140, so $10 actually cuts and posts to the statement (which is sent to the CRAs). Utlization is the next most important part of your score after credit history. A low utlization keeps your score higher.
So... As long as I pay at least the minimum by the due date (the 28th in this example), I will avoid a late payment (Yes) but I need to make sure I pay the Majority before the statement closes (the 3rd in this example). (Yes, if you want to control how much utlization posts) and what I pay before the statement closes is what reports?? (Yes)
I always thought its what I pay before the due date is what reported... sigh.... No wonder my utilization is high. (Yes. If your utilization is reporting high, that's an easy fix. Utlization has no memory and you'll get your points back next statement cut.) I need to stop spending until after the statement closes. (Yes) Why don't they just close the statement on the due date. THIS IS ALL NEW TO ME>
Some charges can be pending, and may or may not make it into the statement cut. This is also why it's helpful to have at least two cards, with different statement closing & due dates.
You're welcome, this is exactly what this forum is for! I'm very curious to see how many points you'll gain back!
A really good guide for rebuilding is ABCD2199s Guide to rebuilding credit, in the credit rebuilding part of the forum. The information is very solid, if you're looking for more tips.