Apping after getting an auto loan with Chase

[Anonymous]

I made the move to a new Mazda CX-5 and got a good deal. My old loan on my Prius c trade was underwater by about $1,500 close to 9% and I had 4 years left on it. The new loan with Chase on the Mazda is 5.9% but they made me get gap insurance at $100/month.

Being that I'm 5 years post chapter 7, I feel pretty good about it. I figured to go on an apping spree the next day and was turned down by Discover on the cash back IT card, then by Amazon (both cards). Yikes. I applied at Target and was told I would hear back in 7-10 days. Last, I just shot at Fingerhut and got a $600 line in seconds.

No more apping for quite awhile, as there are lots of inquiries (about 4 now on TU and 10 on Equifax). My question to you all is how long before I should give it another try and where my best shot would be.

My score at the dealer the other day was 688(TU)...probably lower now. I have a Barclay Platinum and a Capital one QS for about 8K total credit line (and now the Fingerhut). I am employed at around 50K/year and own my condo (for 3 years) at about $800/month for the mort. I'm at about 50% utilization on the CCs but paying it off fast.

[Medic981]

Congratulations on the new car!

If you got your gap insurance through the dealership, I advise that you contact your auto insurance company and inquire as to how much gap insurance would be through them. I am willing to bet that you can save significantly with your insurance company and cancel the gap insurance through the dealership.

[Anonymous]

Thanks for your reply. After reading over my contract it looks like I paid $900 for the gap at the dealership, but I can revoke it and get gap through someone else as long as its ok with Chase. Metromile doesn't provide it, but I'm sure I can get it much cheaper elsewhere! I wonder if the $900 will be put into equity when I cancel it or if I'll get a check.

[Anonymous]

As you may have guessed, you were almost certainly declined because of your very CC utilization.  You might have been able to be approved if you had that utilization without a bankruptcy, but the two together flagged you as extremely high risk.

I suggest that you stop applying for any cards for a full year.  During that time pay off all your CC debt.  Also use that time to make a "full fearless and searching mental inventory" -- e.g. why am I so eager to apply for more credit cards?  (So eager that I am willing to get a Fingerhut.)  What were my spending and savings patterns that led me to go thousands into debt to loan sharks (which is what CC companies are)?  etc.

Also use that time to restructure your spending and savings so that you are saving 20% of your net pay and building up a substantial emergency fund.  And have a plan to prevent you from ever going into CC debt again.

Only after you do all that would I apply for more cards.  In the meantime I would make a small purchase on the FingerHut in the next four months (since you unfortunately have it).  Try to limit your FH activity to something you need and only once every nine months.  That tradeline can be a black hole for money.

When you do next apply for a CC, make sure all your cards are reporting $0 except one, with the remaining card reporting a small balance, like $20.

[Anonymous]

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@Anonymous wrote:

As you may have guessed, you were almost certainly declined because of your very CC utilization.  You might have been able to be approved if you had that utilization without a bankruptcy, but the two together flagged you as extremely high risk.

I suggest that you stop applying for any cards for a full year.  During that time pay off all your CC debt.  Also use that time to make a "full fearless and searching mental inventory" -- e.g. why am I so eager to apply for more credit cards?  (So eager that I am willing to get a Fingerhut.)  What were my spending and savings patterns that led me to go thousands into debt to loan sharks (which is what CC companies are)?  etc.

Also use that time to restructure your spending and savings so that you are saving 20% of your net pay and building up a substantial emergency fund.  And have a plan to prevent you from ever going into CC debt again.

Only after you do all that would I apply for more cards.  In the meantime I would make a small purchase on the FingerHut in the next four months (since you unfortunately have it).  Try to limit your FH activity to something you need and only once every nine months.  That tradeline can be a black hole for money.

When you do next apply for a CC, make sure all your cards are reporting $0 except one, with the remaining card reporting a small balance, like $20.

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^^fantastic advice

[Anonymous]

Thanks for the advice. My plan was to just bundle the apping and not do it again for at least 6 months. I really wanted a balance transfer card just to get out of my high APR, but now I should be able to pay off the remaining Barclay balance within two months. At that point, I'll be at 0% utilization and will use the QS for cashback on purchases but pay it off every month.

I didn't realize Fingerhut was a bad idea. I just figured I would bump my utilization and establish a line without ever using it. Fingerhut is overpriced junk. I see the problem in having such a new account, but it should fade off after awhile. Is there a good reason to make any purchase on the Fingerhut account ever? They promise CL increases, but I don't want to buy their junk.