How to use these cards

[Anonymous]

I am in the process of rebuilding my credit and have some different cards. I would like to know which cards I don't have to use for them to stay open and for them to give me CLI's.

1.Target 2.Orchard Bank 3.HSBC discover 4.Walmart Card 5. PaypalCredit 6.Kay Jewellers 7.Crown Jewellers 8. Hooters 9. Newport News

Which of these cards should I use each month and should I make sure I PIF each month or carry a balance? Please advise me on what I can do to maximize my new TL's while I work on fixing my bad tradelines.

I also don't want to carry the AF cards for more than one more years fee.

[Creditaddict]

Target won't close you, but you probably want to use it a few times if you want it to grow.

you really want to use all of them if you want them to grow and stay open, store cards I think can go longer with no use and not be closed.

Orchard likes to see a ton of use.

[Anonymous]

Orchard/HSBC will shut you down after 2-3 months of inactivity.

[Anonymous]

Ooh ok...good to know.

I will pay utility bills on one and buy groceries on the other. And then just PIF.

[Anonymous]

Hi Bella,

Sorry, I meant to send this to you earlies...Now I don't know who I responded too. (?)

First stop applying everywhere. If you have too many inquiries in a short period of time it will affect your credit score. Maybe not much, but you're already pretty low for a home loan.  A high limit is not going to help you.  $300 is good.  Make a small purchase on it every month and pay it off on time every month.  This way the creditor will start reporting your good credit standing to the bureaus and you will eventually have a decent score.  You do not need alot of credit cards!  If you are having problems getting a card.  Start with a secured line of credit from a local credit union.  A secured card is one that you make a deposit that will intern be your limit.  You need to pay on time  for several months to year depending on the bank and eventually they will return your deposit and then upgrade your card to an unsecured line of credit.  But no more credit card applications for a while OK.

If you're not carrying a balance on the Kay or Crown card, don't buy anything extravagant just to get a score reporting.  Buy some jewelry cleaner and pay it off every month.  LOL  Those cards probably have a high interest rate.  Watch out for those.  Only use 1 or two cards  and pay them on time.

Your balance should not exceed 30% of your limit.  High balances hurt your scores. Good luck!

[Anonymous]

Thanks Gemgirl,

Sounds like some good advice. I bought a $49 bracelet from Crown but will just buy some cleaner from Kays and then rotate the usage in the other cards for small purchases each month.

And I will do no more apps for at least a year except for my student loan!

[Anonymous]

---

@Anonymous wrote:

Hi Bella,

Sorry, I meant to send this to you earlies...Now I don't know who I responded too. (?)

First stop applying everywhere. If you have too many inquiries in a short period of time it will affect your credit score. Maybe not much, but you're already pretty low for a home loan.  A high limit is not going to help you.  $300 is good.  Make a small purchase on it every month and pay it off on time every month.  This way the creditor will start reporting your good credit standing to the bureaus and you will eventually have a decent score. !

---

Actually, high limits DO help you. They help with util and they also serve as a guideline to other CCs in what CL they should give you.

FORGOT TO ADD: $300 Cl is crappy. If she can, she should ask for a CLI if she's had it for a bit or if she's activating the cards. $300 CL is definitely, from everything everyone's told me here, a subprime card that doesn't look good to the lenders.

Message Edited by Wonderin on 07-30-2008 09:20 AM

[Anonymous]

What doesn't look good to lenders is someone trying to get sooo much credit.

Start small with credit you can handle.  No need to obsessed or  stupid.  No need to keep pulling your credit profile or scores. They change often, Evertime a payment is reported, a limit is increased or decreased, an application is filed, etc.  Too many cards can hurt too. If you have too much credit at your disposal (high limits on several cards) lenders see you as a credit risk because they see you have the chance for you to get in over your head should you decide to max out all the credit cards.

Start small or with what you already have, and pay on time.

[Anonymous]

Bella,

I was kidding with the cleaner.  Try and stay away from using the Jewelry cards.  Whatever you use don't go crazy.  Stay within your means and pay on time.  You don't need alot of credit to get scores.

Just pay on time so that each month the creditor has some positive reporting to submit to the bureaus.

I'm reading all of these messages and it seems alot of people are really obsessed with scores.

Your scores change often.  If you have a balance on a card at the time your credit is run, that balance will be factored into the score.  Even if you pay your credit card balances off every month, if when your credit is run and that payment you made to reflect a zero balance has not yet been reported, the balance showing at that time will be factored in. Some credit card companies don't report every month. They should but don't.  Don't get crazy with fico's.  Even the people who have no derogatory marks on their credit reports sometimes have low scores and don't know why.  Too many accounts with balances.  They say they pay off card every month, but when the credit and score are run the balances are not reporting as zeros. And the scores are low. It's a catch 22.

I hope this helps.

[Anonymous]

---

@Anonymous wrote:

What doesn't look good to lenders is someone trying to get sooo much credit.

Start small with credit you can handle.  No need to obsessed or  stupid.  No need to keep pulling your credit profile or scores. They change often, Evertime a payment is reported, a limit is increased or decreased, an application is filed, etc.  Too many cards can hurt too. If you have too much credit at your disposal (high limits on several cards) lenders see you as a credit risk because they see you have the chance for you to get in over your head should you decide to max out all the credit cards.

Start small or with what you already have, and pay on time.

---

True. But that's more regarding too many cards, not "too much credit" in terms of credit limits.

Let's say that about six months from now, Bella decides to try for a house, okay? What scenario do you think will enable them to lend her the money for a mortgage more?

Bella has three cards (for the sake of the illustration), each with a CL of about $1-2K each. Obviously, that means somebody trusted her with that much money/credit, right?

Now let's say that all Bella's got is three cards with $300 limits on each. Lenders might very well decide that if the CCCs can't trust her more than a smidgen, why should they.

Do you see what I mean?

My opinion's moot. It's fairly well established that FICO scores you higher and lenders like you better if you have higher credit limits.

Personally, I think that's probably why all the Mods tend to have gardened their credit to reflect higher scores and why they're usually all for higher limits.