How to build credit from this?

[eveline49]

Hi All! I am now well aware of how dumb I was the past year. I am asking for advice on how I can improve my credit portfolio. I am new to US and I did not use any credit cards before in my life.

I opened my first cc in August 2023, it was a Discover card with 1000 limit on it. Unfortunately, in May they sent me a request to validate my information and I failed to provide the documents as I was travelling urgently outside of the country at that time. They closed my account and I have 600 usd balance there that I am paying off monthly.

My second cc was Capital One Platinum card, if I remember correctly, opened in Oct 2023. They gave me 300 usd limit. I accepted it as I did not know that I will end up with this card being bucketed. I sent couple CLIs, all denied.

Then I opened a Credit One card with another 300 usd limit… I believe it was February 2024. I think I applied for a CLI and it was denied.

In July 2024 I opened another Capital One card (Quicksilver) and also got 300 usd limit. Here the story gets more complicated as I missed one payment due to extraordinary circumstances. I had a 30 day late payment which they agreed to not report.

Two weeks ago I applied for Amazon Prime Visa and they approved me for 500 dollars. It’s not reporting yet on my report.

I also have a credit builder chime card and one affirm installment loan (only 3 months, paid off).

In terms of inquiries I have 7 from last year (cards I opened plus some store cards I got denied for as I did not know how the inquiries work). Plus 2 inquiries from this year.

When I read through this it seems like a terrible choices and a hard situation to get out of, as the cards seem to be bucketed.

I report small balances on the cards but the 600 dollars on the closed discover card is ruining the utilization. I want to get a serious credit card with a decent limit as it’s simply needed sometimes - sometimes a security deposit on a car rental is bigger than my limit. I got several denials from Amex stating the reason that my limit on cards are too low.

Could somebody please help me with tips how to improve this situation? I will take any advice, also critical because I know I was reckless.

[mgood]

Use the cards and pay them off regularly,  obviously. 

Pay off Discover as soon as possible. They will likely allow you to open another one in the future. Discover is pretty forgiving. 

Wait. Don't apply for anything else until it's been at least 6 months since your last account opened. 

If Credit One  is charging you a fee, get rid of it as soon as you get another card.

Good luck. 

[eveline49]

Thank you for your reply! So, Discover is not going to blacklist me for failing to verify information?
Also what I'm worried about is that the Cap1 cards I have are bucketed - they denied every single CLI I made, and also the one late payment I had (that they don't report thankfully) is probably going to harm my future CLI requests and any applications with them.

My worry is that even if I pay all on time (I also don't carry balances on the open accounts) I still will be denied due to the limits being too low, as Amex stated. Also probably the Credit one card is bucketed.

[Patient957]

Your situation really isn't all that bad.  If I'm understanding correctly, you have no derogatory marks on your report, despite a couple hiccups.  

That said, there's a reason you're getting denied CLIs, and it probably has less to do with bucketing and more to do with your profile.  

You're correct that the $600 Discover balance is hurting your profile.  If you can't pay that off, why would creditors offer you big (or any) CLIs?  That Discover balance appears as a big red flag currently.  Get it paid off ASAP.

I would focus your efforts  on maximizing your scores with your existing card setup.  Follow @mgood's advice.  Pay off Discover, use your cards responsibly, and manage your revolving utilization.  Stop applying for anything for at least 6 months and then reassess at that time.

[JoeRockhead]

Get the Discover card paid in full as soon as you can. Until it's paid in full, it's going to negatively impact your scores and hinder your ability to make progress. Once the Discover is paid in full, you'll want to allow a very small balance to report on only one of your remaining cards every month. No more credit builder loans, or affirm accounts. No more credit card applications or new accounts until your current situation is back under control and you have several more months of positive payment history. 

You might want to also consider setting up auto pay on your accounts for the minimum payment due to avoid any further missed/late payments.   

[mgood]

I don't know about that specific situation with Discover,  but I doubt they'll hold it against you in the future other than requiring you to take some extra steps to prove you are who you say you are before approving you for your next account with them.

Cap One probably does have you in a bucket that will not grow quickly. 

[eveline49]

I will pay off Discover in the upcoming 2 months Also, yes, I don't have any derogatory marks.

My worry then is that I'll get denials let's say in 6 more months due to not enough CL on open accounts and from what I understood I cannot change that. So when the Discover card is paid off, what should be my next steps? I mean in terms of where I should try applying - Apple Card perhaps?  Should I now open any checking account with some specific bank to increase my odds (I use Chime for now).

[mgood]

---

@eveline49 wrote:

 . . .what should be my next steps? 

---

Use that Prime Visa and take care of it. That's from Chase. They can be a difficult bank to get in with, but a good bank to have on your side once you're in. Try to have it paid off or nearly paid off on the statement dates, and use the heck out of it in between those dates. You might get some CLIs on that and it could be a path to getting more Chase cards. So show them you need the credit by using most of the limit  and show them you're responsible with it by paying it off regularly. 

[MrDuck]

---

@eveline49 wrote:

I will pay off Discover in the upcoming 2 months Also, yes, I don't have any derogatory marks.

My worry then is that I'll get denials let's say in 6 more months due to not enough CL on open accounts and from what I understood I cannot change that. So when the Discover card is paid off, what should be my next steps? I mean in terms of where I should try applying - Apple Card perhaps?  Should I now open any checking account with some specific bank to increase my odds (I use Chime for now).

---

Please please please start gardening.

You have opened  way to many in such a short time. The credit card game is a lifetime game not a short sprint to the finish. Allow the cards to get 3-6 months then request a CLI.

As for discover pay it off As soon as possible. Also setup auto payments for all your cards. If nothing else set it up to pay the minimum that way if you forget at least you won't be late again you'll just have interest to pay.

[eveline49]

That's definitely something I will do! I assume though they won't offer me any other cards within at least a year due to the 5/24 rule ?