Non Secured Credit Card Hunt

[Gardenhand]

Hello, I am considering adding a credit card to my profile. I will give a breakdown of my current situation and my future goals. 

Transunion- clean report, 12 INQs (most from a single auto loan app but I'm not sure they are coded correctly)

Experian- working on a few medicals and one paid/closed cable bill collection

Equifax- working on a few medicals

On all three bureaus I have three positive trade lines.

secured credit card 2500 dollars with five months of history

secured credit card 500 dollars with five months of history

secured installment loan 1000 dollars with three months of history

I want to buy a home in the next two to five years. I have read that it's best to have three open credit cards with two years of positive history. I would like a credit card that is (1) not secured (2) has a decent rewards program and (3) provides a credit score monthly. Can anyone suggest a credit card that would be good for me beings I have a short, thin history, maybe a credit card company that pulls Transunion only for the application process and won't deny me because I have to many INQs.

Obviously I would be waiting until I have a full six months in with the two secured credit cards and possibly with my installment loan as well if that would increase my chances of success. This way I will have a Fico score. Thanks for any input.

[CreditDunce]

Barclay and RBFCU are the two CCC's that pull TU.   Maybe the Barclay Rewards or Barclay Ring.  You should be able to PC the card to something better later.   Barclay offers periodic TU-08 credit scores, although it is not monthly.

I don't know RBFCU's underwriting criteria, but they have a decent 321 MC Rewards card.  They do not offer monthly FICO's.  Be sure to check the credit pull DB for information on the scores they are looking for approval.

With 6 months history, you may not have that many options.  However, with one year of credit history you will have more options.  Especially, if you can clean up your EX and EQ reports.   For example, Discover is known to extend credit to people with limited credit history.  The Discover IT has a good reward system, shopdiscover and monthly TU-08 scores.  For me Discover pulled EQ. 

You didn't list who you have your secured credit cards with.  However, if they unsecure them (e.g. BoA) after a year, the credit lines may start growing. 

[Gardenhand]

Thanks for the reply. My current secured cards are with SDFCU and TD Bank. SDFCU does not graduate to unsecured. TD said they would review after two years. I'm not sure if that would mean a new unsecured card or unsecuring the secured card.

I would have no problem waiting until after twelve months for a new card. However I'm under the impression that when applying for a mortgage I don't want any new accounts on my reports. That's why I was thinking the sooner the better so the card would have time to age. 

Maybe I should be looking at a third secured card...

[CreditDunce]

If you have the money for another secured card, BoA is known to graduate secured cards within a year.  The secured card can be converted to their Cash Rewards 321 card, so you get decent rewards.  Once the card graduates you can PC it to almost any BoA card.  Any card you PC with BoA will maintain the same credit history.  You can PC right up to your mortgage (just be aware it will cause a mid cycle CR reporting).

My main hesitation is BoA sometimes denies for bad credit.   I don't think your credit is bad enough for them to deny, but it will be YMMV.  BoA also does NOT currently offer a Free FICO.

I think you are doing everything right to be able to purchase a house.   It is best to not apply for anything 2 years before applying for a mortgage.  However, I one year is probably plenty good enough.  Any HP damage will fade after 1 year.  The accounts will still show up as new, but it shouldn't be too bad.

[Gardenhand]

Thanks again for the information. I was denied a secured credit card by Capitol One and TD Bank five months ago. After begging TD they finally gave me the card haha. I talked to BoA but I wasn't willing to let them hard pull my credit at that time. I already new I had no credit history except for the medical collections. Maybe things would be different now with almost six months history.

If I were to get another secured card I would either want a soft pull only or a near guarantee of being approved. BoA would be ideal since they graduate their cards. The rewards and monthly credit score are not deal breakers. I suppose I'm not in a position to be making demands haha.

Thanks for the vote of confidence on the home purchase planning. I would just be content with my two secured cards and one secured installment loan if that would generate enough history. I just don't want to be looking back in two years wishing I opened a couple more accounts.

[CreditDunce]

Two cards will generate enough credit history.   The third card is mostly useful due to a quirk in the scoring.   You are penalized if half or more of your credit lines are reporting a balance.   Letting zero cards report is also bad.   Therefore, you don't have a good option.  

As long as you keep the number of HPs reasonable, they will not hurt too much.  More importantly they are a short term pain.   In a year, they will not hurt your score.  Some CCC's may not like all of the INQs, but your score will not be hurt.   The only way I know of to get a credit card without a HP is the shopping card trick or a secured card from SDFCU.   Personally, I wouldn't go for the shopping card trick unless the card would otherwise be useful to you. 

Once you get 6+ months of good credit history, I think you would have a reasonable chance with RBFCU and Barclay.  So don't give up on them.  At least try Barclay's pre-approval site in a month or two.

Cap1 will probably approve you with 6 months history, but it will be for a sub-prime card with AF.  They are hard to PC.  And they pull all 3 major CRA's.

If you shop at Khols, they are relatively easy to be approved for.  I would guess they would want 6 months of history.  But search the forums to see how much credit history they want before they will approve.  Note, they used to be much more strict before they changed CCC servicers.

With 1 year history, I would investigate an Amex Charge card or the Delta Revolver.   Amex doesn't like collections, etc.  But if they are paid, they may be more lenient.