Approved for Amex BCE + what’s next?

[Anonymous]

Hello,

6 months ago I started building my credit and I have learned a lot from you here just by reading your posts but this is my first time contributing in case anybody finds my data points useful. 

My background: graduated college in 2020 & recent immigrant to the US, so no credit established. Decided it was time to build credit last year and got approved for a Citi secured card July 2020 with a $1,000 limit. The reason I went for the citi is to have the option to convert to double cash upon graduation. I put one bill on that card to autopay, then paid off most of the balance before the statement cut, always leaving around $17-$20 (2% utilization) to report.

I was looking to thicken up my credit and add more accounts to my file right away but I didn't want to get into any more secured cards and would rather wait to generate a FICO score after 6 months of credit and then apply for a "real" unsecured card. This January my 6th Citi statement finally posted and to my surprise my first EX FICO8 was 750, EQ FICO8 didn't generate a score yet and I have no access to know what my TU FICO8 is. Funny enough my EQ & TU VS3 from Credit Karma were both 706 (penalizing thin files?) so I really didn't expect that my EX FICO would be higher than the vantage score. Knowing Amex likes to pull Experian, I decided to go for the Amex BCE card. I checked the prequal first, looked good to go, applied and got approved for my 1st real unsecured credit card! Unfortunately,  I only got approved for $2,000 but I figure at least I got my foot in the door and will request CLI later.

Overall, I'm happy with 2 cards for now, especially Amex since it matches my spend habits anyway (groceries & gas). Planning to do AZEO with the 2 cards to boost my score. The question I have now is how to thicken up my file a little more. 2 accounts is better than nothing, but still not enough for a very robust file. Also, it's worth mentioning - the goal of my credit build journey is not to pick up any subprime cards along the way. I don't need to necessarily have a ton of cards but I would rather avoid getting cards that I will regret later. Instead, I'm looking into getting with better quality issuers like Chase, however I know that they are unlikely to approve with under 1 year of credit. I was also thinking about Discover due to their great 5% categories but no luck with the prequal there so I left that idea for now. I hope some experts here can provide their suggestions, how should I plan my next applications? Do you recommend gardening for the next 6 months and then apping for a Chase Freedom Flex? Should I pick up additional cards along the way just to thicken up my file (like Discover)? Also, I have no installment accounts but I'm really not looking into getting debt just for the sake of having it improve my account mix.

Thanks!

[Credit4Growth]

🤔 What is next...  I will start with congratulations! 👍

[Slabenstein]

@Anonymous  might have some good insight for growing a young, thin profile.  One thing I might recommend is to look at what cc offerings your local credit unions have and see whether there are any that look attractive to you.  Most aren't going to have monster reward cards, but they're often open to young, thin files and usually offer good APRs.  As far as installment loans, did you leave college with any student loans?  If so, you already have installments for mix.

[Anonymous]

@Credit4Growth Thank you! 

@Slabenstein thank for responding! 

As far as student loans go, I went to school in the UK and was able to pay cash for the entire 3 years so no student loans for me. Then moved to the US for work so I have no installments at all on my credit. 

 A car loan may come up at some point, but hoping not to do it for as long as possible (working from home due to Covid).

[M_Smart007]

Congratulations!

[AllZero]

Congratulations on your approval!

[Slabenstein]

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@Anonymous wrote:

@Credit4Growth Thank you! 

@Slabenstein thank for responding! 

As far as student loans go, I went to school in the UK and was able to pay cash for the entire 3 years so no student loans for me. Then moved to the US for work so I have no installments at all on my credit. 

 A car loan may come up at some point, but hoping not to do it for as long as possible (working from home due to Covid).

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"Finances over FICOs" is something you'll see said around here, and that's b/c it's a very good mantra.  Doing what's best for your finances is pretty much always going to be better than doing what's best for your FICOs when there's a conflict between them, since having good FICOs only matters b/c of what they can do for your finances.  If opening an installment loan doesn't make financial sense, then the score bonus to mix probably isn't going to be worth the cost.  That would be especially true of an auto loan, which as a loan on a quickly depreciating security is basically a really bad idea except most of us need a car.  If right now you're lucky enough to not need one, then I'd advise to luxuriate in not owing on a money hole for as long as possible. 

There is a way to get installment mix points (and points for low balance:loan ratio) for relatively cheap if you really want to, via the SSL technique if you can find a lender where it works.  Whether the potential score boost would be worth the cost in interest and tying up some savings is up to you, but you can read about it here: https://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Adding-an-installment-loan-the-Share-Sec... 

[Anonymous]

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@Anonymous wrote:

Hello,

6 months ago I started building my credit and I have learned a lot from you here just by reading your posts but this is my first time contributing in case anybody finds my data points useful. 

My background: graduated college in 2020 & recent immigrant to the US, so no credit established. Decided it was time to build credit last year and got approved for a Citi secured card July 2020 with a $1,000 limit. The reason I went for the citi is to have the option to convert to double cash upon graduation. I put one bill on that card to autopay, then paid off most of the balance before the statement cut, always leaving around $17-$20 (2% utilization) to report.

I was looking to thicken up my credit and add more accounts to my file right away but I didn't want to get into any more secured cards and would rather wait to generate a FICO score after 6 months of credit and then apply for a "real" unsecured card. This January my 6th Citi statement finally posted and to my surprise my first EX FICO8 was 750, EQ FICO8 didn't generate a score yet and I have no access to know what my TU FICO8 is. Funny enough my EQ & TU VS3 from Credit Karma were both 706 (penalizing thin files?) so I really didn't expect that my EX FICO would be higher than the vantage score. Knowing Amex likes to pull Experian, I decided to go for the Amex BCE card. I checked the prequal first, looked good to go, applied and got approved for my 1st real unsecured credit card! Unfortunately,  I only got approved for $2,000 but I figure at least I got my foot in the door and will request CLI later.

Overall, I'm happy with 2 cards for now, especially Amex since it matches my spend habits anyway (groceries & gas). Planning to do AZEO with the 2 cards to boost my score. The question I have now is how to thicken up my file a little more. 2 accounts is better than nothing, but still not enough for a very robust file. Also, it's worth mentioning - the goal of my credit build journey is not to pick up any subprime cards along the way. I don't need to necessarily have a ton of cards but I would rather avoid getting cards that I will regret later. Instead, I'm looking into getting with better quality issuers like Chase, however I know that they are unlikely to approve with under 1 year of credit. I was also thinking about Discover due to their great 5% categories but no luck with the prequal there so I left that idea for now. I hope some experts here can provide their suggestions, how should I plan my next applications? Do you recommend gardening for the next 6 months and then apping for a Chase Freedom Flex? Should I pick up additional cards along the way just to thicken up my file (like Discover)? Also, I have no installment accounts but I'm really not looking into getting debt just for the sake of having it improve my account mix.

Thanks!

@Anonymous: I think your plan is already pretty good! Definitely wait 6 months, or until July when you're at AZEO (1 of 2 with a small balance reporting) and the Citi and Amex cards have already reported for the month.

Then I think you should go for Discover FIRST, then Chase right after. I did the BCE first, then Discover in the same night: AMEX was instant $11,500 but Discover saw 1yr2mo revolving history and a fresh inquiry at EX and decided to take some time thinking about it. I ended up with $4000 from Discover within 12 hours of approval. (They didn't even send email notification of approval either.)

Citi soft-pull credit limit increases (SP CLIs) have been great for a lot of people, myself included. The first 2 were $2500 each and the next was $1500 (after spending WAY more each month too, go figure!). I think you should tap that Citi SP CLI button right now!

I posted a year's worth of full 3 bureau reports from myFICO to the forum. That's my entire first year with credit cards on all 28 scores, month-by-month. I now have 2yrs 1mo total revolving history and I'm at/or above 740 on FICO 8's, with all 4 cards reporting a modest balance (9% or below). (I always pay to zero on everything right after statement close - the graph looks like a sawtooth waveform every month.)

Everything is more sensitive on young credit profiles, but point recovery at 3mo and 6mo is pretty good, especially on the EX 8 score. Expect a loss of -19 and -14 on EQ and TU 8, respectively, when letting 2-of-2 cards report a balance. Go back to 1-of-2 and they come right back.

You're off to an awesome start!

( @Slabenstein : Thanks for the tag! Sunday is probably the only day I'll have time to post from now on, and I'm glad I was (hopefully) able to help someone with a similar profile to mine.)

[gdale6]

Grats on your BCE approval and welcome to myFico

[Anonymous]

@Anonymous you are awesome! This is very helpful and your past posts are a mine of information to study. I will see if I can follow a similar app pattern to what worked for you.

The citi sp cli is something that I didn't think of. Didn't know it was possible on their secured card so I definitely need to look into it further. 

@Slabenstein exactly my reasoning. At least building up with credit cards doesn't require changing any existing spend habits, just switching over from using my bank cards to credit cards. Loans is a whole other issue... so as you say, I will enjoy not having a money pit for as long as a I can