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Should I cancel my secured cards?

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New Member

Should I cancel my secured cards?

Hello!

 

My Chapter 13 was removed from my credit in January of 2019. At that time I obtained 3 secured cards (Discover $300, 5/3 Bank $500, and US Bank $500). I was recently approved for an American Express Everyday Preferred $1,000 and a Citibank Double Cash $3,000. What should I do with the secured cards since it has only been about 5-6 months? I am definitely keeping the Discover card so they can convert it to unsecured and Discover is a really good company. But what about the other two? Should I close them? They offer no rewards and even if they are switched to unsecured, it will be the most basic card with no rewards. Thank you!

9 REPLIES 9
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Valued Contributor

Re: Should I cancel my secured cards?

I wouldn't get rid of them just yet they are making your Age longer and if you drop them it will hurt your score by losing the length ....if anything ask about upgrading them to unsecured if that would keep the length from the start of the secured that is what I did with my bank to prevent losing the time I had with the Secured card and after a while of establishing a longer history then maybe cancelling later but definitely not now










Message 2 of 10
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Valued Contributor

Re: Should I cancel my secured cards?

Also I would hold onto them for at least a year before flipping over too Smiley Happy










Message 3 of 10
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Valued Contributor

Re: Should I cancel my secured cards?

get your $1000 back and use it for something else.  It still leaves you w/ 3 CC's which is enough for scoring purposes.  Unless you're using and abusing your cards closing them won't really do much to your scores.

500K+ TCL / 800+ FCOs
Message 4 of 10
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New Contributor

Re: Should I cancel my secured cards?

If it isn't costing you anything I would keep them, especially for US Bank you could end up with their Cash plus card..





Garden Life: 4.01.20
Leaving Garden: 1.15.22
Updated: 4.15.20





Message 5 of 10
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Senior Contributor

Re: Should I cancel my secured cards?

Definitely keep the USBank card - it can graduate afte 1 year (and reportedly if your FICO is at least 680).  You have to call them and ask.  And yes, it graduates to the vanilla Visa, but you can product change it.   Et voila - you'll get a Cash+ (or whatever) with a 1 year history behind it.

It's specifically why I got the USBank secured Smiley Wink.




F8 EQ: 804 | EX: 794 | TU: 801 | Accounts: 2/6 4/12 9/24
Happy practitioner of AZE9or10or11 | Team Finances > FICO
Message 6 of 10
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Established Contributor

Re: Should I cancel my secured cards?


@EB_CHI wrote:

Hello!

 

My Chapter 13 was removed from my credit in January of 2019. At that time I obtained 3 secured cards (Discover $300, 5/3 Bank $500, and US Bank $500). I was recently approved for an American Express Everyday Preferred $1,000 and a Citibank Double Cash $3,000. What should I do with the secured cards since it has only been about 5-6 months? I am definitely keeping the Discover card so they can convert it to unsecured and Discover is a really good company. But what about the other two? Should I close them? They offer no rewards and even if they are switched to unsecured, it will be the most basic card with no rewards. Thank you!


It seams like some of the decisions you are thinking about are very short sighted. Here is the real value of each of those cards. First off all of those cards are fresh and really should be left alone until they rack up 1yr at least of history. The Discover It Secured card can unsecure into a regular card and even now racks up rewards. It should graduate in 7-12mo assuming you do not butcher anything. So as you say it is a keeper. The US Bank Secured is however not valued in the card that it is or the card that it becomes but as the card that keeps your foot in the door. Also a simple PC after it graduates can make you a monster of a card in the form of a US Bank Cash+. Graduation usually is a year or so. If you truly wish to work with US Bank you will hold on to this card as you can keep your history along with your relationship as you move to more powerful cards. 5/3rd Bank Secured is the card I have the least background on but I have reason to believe it does graduate. Also 5/3rd Bank is a bank I do not have a lot of data on so just find a card you want and think about getting that card with your secured history. You will not be able to replace history so if you can hold on to it do so. You can always close a card later after stripping it of resources like its credit line.

TU:758 06/19/20 Bank of America--EX: 776 06/10/20 Experian--EQ:810 09/25/18 Citi--Gardening since 07/02/20
Active:
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Message 7 of 10
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Community Leader
Super Contributor

Re: Should I cancel my secured cards?


@EB_CHI wrote:
Short sighted? I was only asking a question. But thanks for the info.

@EB_CHI  first, welcome to the forums!!

 

Second, congrats on your BK falling off, I know thats a huge relief! I still have 4 years left Smiley Wink

 

Next, Im sure the poster didnt mean it that way, so ignore that part, but I will agree with what others have stated. At the minimum, keep them all for 1 year, and then Id close 5/3 if it doesnt graduate. USB and Discover are keepers!  Smiley Happy


My rebuild worked for me, but won't necessarily work for you!
BK7 D/C- 08/2013
Message 8 of 10
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Valued Contributor

Re: Should I cancel my secured cards?

Just to explicitly mention as I think some people get confused about this, closing a card will not hurt your account age, for ten years. Closed accounts still count toward age. Otherwise, I think other people know more about the two banks in question than I do, so I offer no opinion. Obviously, keep Discover.


No derogs, but tons of inquiries and heavy credit-seeking behavior. In March of 2019, I had no open accounts, a charge-off, two collections, and scores in the low 500s. What I call the "thick build method" worked for me, but may not work for every situation.
Cards

Authorized user / Corporate / Auto loan / Personal loan

Card CLs total $89,900, not counting the AU card. The AU card brings the total to $114,900. In March 2019, card CLs totaled $0.

Closed but still on reports: ExxonMobil, $950, 10/08-02/11 (Equifax only) | American Express Delta Gold, $1,000, 09/19-10/20 | Citi secured, $200, 04/19-09/19 | Capital One secured, $300, 04/19-08/19 | My Jewelers Club, $5,000, 05/19-08/19 | Green Dot Primor, $300, 05/19-08/19 | Self Lender secured $500 loan, 04/19-01/20 | Unsecured personal loan from Coastal, $1,000, 06/19-08/19.
Message 9 of 10
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Super Contributor

Re: Should I cancel my secured cards?


@Girlzilla88 wrote:

I wouldn't get rid of them just yet they are making your Age longer and if you drop them it will hurt your score by losing the length


This is completely inaccurate, as closing a CC doesn't impact your age of accounts at all.  There are other good reasons not to close them, though, illustrated by zerofire in Post 7.

Message 10 of 10
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