Cap1 Buckets, and getting out of them

[GreyvyTrain]

Thanks everyone for the help. I pulled the trigger and closed that QS1. Figured it's about time to start shutting down all my rebuilder cards and hit the garden for a while. Got a few more months left on that Aspire and Merrick card with AFs they'll be next to go. Hoping this SV1 that I PCd from a regular QS might show me some love in September when it hits 6 months since the PC. 

[GreyvyTrain]

@Zoostation1 Pertaining to getting a pre approval on one with a SUB, am I most likely going to have to wait unti my COs fall off and I have a clean report before seeing those pop up?

[GZG]

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@GreyvyTrain wrote:

@Zoostation1 Pertaining to getting a pre approval on one with a SUB, am I most likely going to have to wait unti my COs fall off and I have a clean report before seeing those pop up?

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they honestly may never pop-up for you, it's not as simple as clean profile = sub with cap1,

they may never like that you have a bunch of bucketed cards, they may not like that you have a bunch of cards

only thing you can do is keep trying to seeing what cap1 thinks with the pre-approval, but I wouldn't be too disappointed if it never happens 

[GreyvyTrain]

@GZG  How about just cards with them with limits worth having?

[GZG]

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@GreyvyTrain wrote:

@GZG  How about just cards with them with limits worth having?

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apply for another one and hope for the best with the knowledge that cap1 might just give you another $300-$500

the growth potential of $300-$500 cards from dirty profiles is very limited, not saying it won't happen, but if you're willing to eat the HPs to try, might be worth trying, particualrly if your credit is in a far better shape with all bad debt paid off since you originally applied for those previous cap1 cards

[Zoostation1]

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@GZG wrote:

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@GreyvyTrain wrote:

@GZG  How about just cards with them with limits worth having?

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apply for another one and hope for the best with the knowledge that cap1 might just give you another $300-$500

the growth potential of $300-$500 cards from dirty profiles is very limited, not saying it won't happen, but if you're willing to eat the HPs to try, might be worth trying, particualrly if your credit is in a far better shape with all bad debt paid off since you originally applied for those previous cap1 cards

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I would generally agree with you.   I have 2 Capital One cards that are lowish bucketed, but not to the degree that the $300-$500 cards the OP has would be, but also have 2 cards that aren't bucketed and had solid starting limits ($10k and $20k).  C1 likes heavy usage and even if you're PIF their algorithm seems to like reported balances. VX was my first 10k card (I think you may have posted the preapproval link when  you couldn't navigate directly to it yet?) in the rebuild and 2 months prior to applying I had recently reported my highest statement balance (~$946/$3000 CL at the time) on SavorOne and scores were in the 677-685 range for FICO 8.  When I opened Savor it was $20k CL to start and had recently had my highest VX statement balance (~$2354/$11.5k at the time).  Scores were around 690 for FICO 8 (685 EQ5 was what was referenced in the approval letter), had all preapprovals listed, and finally didn't get the highest rate offered.   Also, while C1 is not known to be a relationship bank, I still wonder if having a HYSA with them helps at all. 

For the OP, as long as they have any COs reporting I think they're going to be stuck in a low bucket and wouldnt waste a triple pull on them.  While a CO comes off faster than BK7 it seems to more heavily supress scores for the duration.

[IsambardPrince]

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@GreyvyTrain wrote:

@Zoostation1 Pertaining to getting a pre approval on one with a SUB, am I most likely going to have to wait unti my COs fall off and I have a clean report before seeing those pop up?

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Not necessarily. Capital One gave me two $200 SUBs. 3 and 4 years out from a bankruptcy where they ate $30,000 on me.

And now I have a $20,000 credit line with them again.

[IsambardPrince]

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@GZG wrote:

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@GreyvyTrain wrote:

@Zoostation1 Pertaining to getting a pre approval on one with a SUB, am I most likely going to have to wait unti my COs fall off and I have a clean report before seeing those pop up?

---

they honestly may never pop-up for you, it's not as simple as clean profile = sub with cap1,

they may never like that you have a bunch of bucketed cards, they may not like that you have a bunch of cards

only thing you can do is keep trying to seeing what cap1 thinks with the pre-approval, but I wouldn't be too disappointed if it never happens 

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Capital One must like the borrowers a bit dirty.

They offered me a QuickSilver with 0% for 15 months, 26.24% APR, and $10,000 credit line last month with FICOs in the high 600s and 4 years after they lost $30,000 on me in a bankruptcy.

My spouse, who has a good history with Capital One, 782 FICO (TU FICO 8, similar at other bureaus), and no bad marks on his credit got the same offer, but his ongoing APR would be 29.99%.

There's no telling how Capital One is making their decisions. I mean, it's their decisions to make but I can't see the logic of offering me a better deal than my spouse, and yet they did.

Whatever their computer system decides to give you, there's no arguing about it. Their representatives have no discretion to do anything to the account.

They'll never let you out of COMET entirely if you're there (the securitized "bucket" cards that other banks invest in by proxy for borrowers they don't touch), and like $500 of the limit will be in COMET. Capital One may raise your limit a bit with its own money, but a bucket card that's in COMET will always be tainted and at their very worst interest rate.

[DanteJuan95]

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@IsambardPrince wrote:

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@GZG wrote:

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@GreyvyTrain wrote:

@Zoostation1 Pertaining to getting a pre approval on one with a SUB, am I most likely going to have to wait unti my COs fall off and I have a clean report before seeing those pop up?

---

they honestly may never pop-up for you, it's not as simple as clean profile = sub with cap1,

they may never like that you have a bunch of bucketed cards, they may not like that you have a bunch of cards

only thing you can do is keep trying to seeing what cap1 thinks with the pre-approval, but I wouldn't be too disappointed if it never happens 

---

Capital One must like the borrowers a bit dirty.

They offered me a QuickSilver with 0% for 15 months, 26.24% APR, and $10,000 credit line last month with FICOs in the high 600s and 4 years after they lost $30,000 on me in a bankruptcy.

My spouse, who has a good history with Capital One, 782 FICO (TU FICO 8, similar at other bureaus), and no bad marks on his credit got the same offer, but his ongoing APR would be 29.99%.

There's no telling how Capital One is making their decisions. I mean, it's their decisions to make but I can't see the logic of offering me a better deal than my spouse, and yet they did.

Whatever their computer system decides to give you, there's no arguing about it. Their representatives have no discretion to do anything to the account.

They'll never let you out of COMET entirely if you're there (the securitized "bucket" cards that other banks invest in by proxy for borrowers they don't touch), and like $500 of the limit will be in COMET. Capital One may raise your limit a bit with its own money, but a bucket card that's in COMET will always be tainted and at their very worst interest rate.

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What is COMET?

[IsambardPrince]

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@DanteJuan95 wrote:

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What is COMET?

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COMET is an acronym for Capital One Multi Asset Execution Trust.

Basically, when Capital One writes card accounts to the worst credit risks, they diversify away from those same accounts.

They often assign them a $500 credit line and then sell them as debt-backed securities to other banks. Although one of those banks is Capital One themselves.

RBS Capital Markets, J.P. Morgan Securities and Wells Fargo Securitiesare some of the others.

Basically, it allows Capital One to write a card to a person without assuming a lot of credit default risk. A risk level is assigned to the borrower on account opening, and that borrower is put into a Class A, B, C, or D tranche and the collateralized debt obligation is sold off based on how much risk there is. Generally, the Class D risk level from what I understand is mostly what you'd call "bucket" cards, the ones that start out at $300-400-500 and never seem to grow much. All the money backing the credit line is from COMET.

Capital One has no reason to ever move you to a different bucket on that account once it's written no matter how much your credit improves.

For starters, they have a reason to want higher credit scores in riskier buckets. If people's credit scores improve while they're in that bucket, they can claim that the bucket is less risky because some people with higher FICO scores bring the average FICO rating of the debters in the bucket up. That helps it look like the average charge off or delinquency rate is lower than it would be without those people who didn't bother to close their card down when they got better cards, or are still using it even though they could get a better card now.

The cards Capital One writes and puts a lot of or all of their money into backing the credit lines tend to be the less risky customers that they want all for themselves. So if Capital One's Pre-Approval tool is offering you a lower APR card with a SUB, then you take it and get a huge spending limit, it means that they want your account directly managed by their bank and assets because they don't plan to write off many people like you to delinquency and charge off later on.

The reason other banks get into speculating on these bucket cards in COMET is because it lets them chop up and diversify bad credit risks figuring they won't all go bad, each person is only at risk of burning them for some paltry amount, and overall even with a higher charge off rate, the tranche will profit because most debtors who have bad credit will pay a bunch of fees and make minimum payments as they're poorer and less sophisticated. And the fact that they probably don't even earn any credit card rewards and pay the highest APRs is gravy. If they earn rewards on something like a QuickSilver One, then they'll pay a $39 annual fee which nullifies some of the rewards.

Since these debtors have few options in the credit card market, along with offering them low limit high APR cards that have fees or no rewards program, the bank also doesn't have to offer them a Sign Up Bonus (SUB) because that's another key aspect of bad credit lending, you don't have to do anything to sweeten the pot. These are people who are trying to build their credit to qualify for a better job or apartment or car loan, but for most of them the product will probably end up making things worse because they already had bad credit for a reason and many will max these things out and end up making minimums, getting nothing of value out of the card while paying the bank a lot of money and while FICO whacks them for "maxed out credit cards", and these cards are bad cards that are expected to make a lot of money for the bank in fees, exorbitant interest, and lack of rewards (or rewards that are eaten up by fees).

These cards, while bad, are not _as bad_ as "Credit One", which shouldn't be confused with Capital One, or fee harvesters like First Premier.