One card with high limit or three with lower?

[vV35Hszm]

I AM rebuilding...

Discover Secured - Graduated and changed to Discover Cashback!

Capital One Secured - graduated and changed to Capital One Quicksilver!

I think I have an old collection (USAA $20K) that makes my utilization look high, hence me considering additional secured cards.  In a year, they graduate, the collection drops off, and I'm golden... at least that's my plans!

[vV35Hszm]

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@K-in-Boston wrote:

I would also have to echo that with three unsecured cards, none of which are subprime lenders, it likely wouldn't do much good for you and may in fact hinder your ability to grow your current credit lines due to the presence of new account(s) and a reduction in your average account age.  Putting that $5k into something interest bearing (even a NFCU checking account) that you use to make multiple payments to keep your utilization in check throughout the month would be a better solution.  Putting spend through the accounts will show your lenders that you need a higher credit line and you won't have that $5,000 tied up and not accruing interest for months or longer.

If you really have your heart set on opening a secured account, though, I would suggest putting all $5,000 into a single account, preferably from a lender where it will unsecure and grow like a card that began unsecured in the future like Bank of America.

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Thanks... and per another thread you may have seen my biggest concern there is having a tax lien wipe it out.

I did apple with Citi a couple days ago for $2500 secured and am still waiting.  Thinking of doing $2500 with BoA too and calling it good.  Five cards is pretty solid right?  Thanks all.

[Anonymous]

In that case, go for the Bank of America secured card, the NFCU secured, or the US Bank secured card. They all graudate.

[K-in-Boston]

Five cards would be completely solid, yes.  I'm (fortunately) not well-versed in negative account history, but I don't believe collection accounts factor into utilization.

[vV35Hszm]

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@K-in-Boston wrote:

Five cards would be completely solid, yes.  I'm (fortunately) not well-versed in negative account history, but I don't believe collection accounts factor into utilization.

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It seems to when I look at my score on various sites like Credir Karma.

[HeavenOhio]

If your report is clean, I'd go for an AMEX revolver when the time is right. It may start with a decent limit right off the bat. If not, you'll be able to start increasing it soon enough.

With Discover, I'd ask for limit increases periodically, maybe every 60 to 90 days. If you're denied, there's no time limit before you can request again, meaning there's no harm in asking.

I'd also look for limit increases on your Capital One card. You're eligible if you haven't had a CLI within the past six months. If you're denied, you're eligible to request again immediately. Keep in mind that you can decline a CLI offer if you think it's too low. That way, you won't reset the clock and you can make a request again relatively soon.

Increasing your NFCU credit line will likely entail a hard pull, so I'd be more careful about timing on that one. I think you may be able to use the same pull for a new card application and a CLI on a current card, though. Someone here will need to confirm. NFCU will grow your limits with time, though.

[K-in-Boston]

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@vV35Hszm wrote:

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@K-in-Boston wrote:

Five cards would be completely solid, yes.  I'm (fortunately) not well-versed in negative account history, but I don't believe collection accounts factor into utilization.

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It seems to when I look at my score on various sites like Credir Karma.

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Credit Karma and other FAKO score sites are notoriously unreliable for factors like that.  In your Discover account, you should be able to see your utilization when you look at your FICO score.  That will be based on TransUnion.  Discover also offers a similar dashboard with a free monthly Experian score at creditscorecard.com

[vV35Hszm]

Thanks... I will do.

Oh and I'd like to add one other part of my thinking in doing additional secured cards in addition to reducing utilization is to have graduated cards with Citi or BoA in a year or two and then switch products.  Both seem to have leading rewards programs!

[Anonymous]

BOA has great rewards—you will be golden in no time. Good luck!

[Anonymous]

To echo what some have said, I think opening  high yield savings account or a 12-24 moth CD would be better idea. Earn some Money off of your Money! Even if you only put$3k IN saving and $2K in a secured card. But not all $5K.

Meantime try to work with current lenders for CLI's, all thee are decent to very good. Then in one year you can app for a couple better cards if need be.

I don't see a $5K secured card helping with utilization unless you constantly carry a $1500 balance. It defintiely isn't going to help with that old Collection any.