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I've been trying to help my little sister (22 yrs old) start her credit journey off right and I need a little advice.
So far, she has 1 cap one plat card and a 1 store card. Her Cap1 card just increased to a $500 limit now that she's had it about 3 months. I feel like she needs another card now to help her UTI since her current card limits are so low. Right now she has a 671 score and 5 inqs. She has a pre-qualify offer for the AMEX Delta w/ a "up to $1000" limit. I would rather she not sign up for a card with an annual fee, but it's the only card that came up as a pre-qualified match. I was happy to see this becuase I also checked Chase, Citi, BOA and Discover with no luck. (Discover was an issue b/c apparently her SSN on Equifax report is incorrect.) I'm considering trying our luck w/ a PenFed, or a fast growing card like the Nordstrom Visa. But neither have pre-qualified/pre-approved offers, so I'm a bit nervous for the cold app, as we're already up to 5 inqs.
What do you suggest? Any and all advice is greatly appreciated. Thank you!!
I would just sit tight until things hit 1 year and then reconsider the plan of action. Fix the error with the SSN so it matches when the next round of apps comes. Have her keep the reporting balances under 10% and things should improve with time.
@DH1988 wrote:I've been trying to help my little sister (22 yrs old) start her credit journey off right and I need a little advice.
So far, she has 1 cap one plat card and a 1 store card. Her Cap1 card just increased to a $500 limit now that she's had it about 3 months. I feel like she needs another card now to help her UTI since her current card limits are so low. Right now she has a 671 score and 5 inqs. She has a pre-qualify offer for the AMEX Delta w/ a "up to $1000" limit. I would rather she not sign up for a card with an annual fee, but it's the only card that came up as a pre-qualified match. I was happy to see this becuase I also checked Chase, Citi, BOA and Discover with no luck. (Discover was an issue b/c apparently her SSN on Equifax report is incorrect.) I'm considering trying our luck w/ a PenFed, or a fast growing card like the Nordstrom Visa. But neither have pre-qualified/pre-approved offers, so I'm a bit nervous for the cold app, as we're already up to 5 inqs.
What do you suggest? Any and all advice is greatly appreciated. Thank you!!
I'm just curious why you think your sister needs help with her utilization.
@Anonymous wrote:
I'm just curious why you think your sister needs help with her utilization.
oh because she bought 1 plane ticket on her card and uti increased to 99% and her credit dropped. She paid it down to 35% within a month but because she has some more travel plans on the horizon, we were thinking maybe it's time to try for another card since she wants to be able to use ~$500 without the big impact on her score.
@DH1988 wrote:
@Anonymous wrote:
I'm just curious why you think your sister needs help with her utilization.
oh because she bought 1 plane ticket on her card and uti increased to 99% and her credit dropped. She paid it down to 35% within a month but because she has some more travel plans on the horizon, we were thinking maybe it's time to try for another card since she wants to be able to use ~$500 without the big impact on her score.
She's in credit building stage where $500-$1000 limits are normal and to be expected, and that's if approved. Other than that, it's secured cards or predatory lenders if one gets too impatient.
She can control reported utilization by paying card down before statement closes.
My two cents based on my experience on this forum: If she's building her credit, getting in with American Express now at an early age seems like to best course of action. Yes the Delta Gold has an annual fee, but it's waived for the first year. And utilization has no memory... meaning if her score dips due to utilization, it's only temporary. She should garden for a while and not put in any more apps if she gets the Delta Gold anyway, so her current credit score won't matter. By the time it's appropriate for her to apply for another card, she should have low balances if she's managing her finances correctly. Also, she should get a score boost for having and managing two legit credit cards (the store card doesn't really help her credit profile, from what I understand).
1. Resolve the SSN issue *now* before apping for anything else....
2. Wait until you are *sure* her reports are correct and have been corrected... Also EQ should send Discover a correction ......
3. Consider trying the prequal for both the amex and the discover *after* the SSN is resolved..... then choose or go for both....
You want to resolve whats causing the issue with discover so it doesnt happen with anyone else...
4. Garden
-J