Improving a 586 score

Anonymous · ‎05-18-2014

Hello all!

New to the forums, and grateful for any advice. I have a score of 586, which I've managed to bring up from a dismal 518.

Right now I have a secured credit card with a $200 limit. Utilization is at about 60%, but next month that will drop to 20% and I plan to keep it below that mark from here on out. Right now I have a 76% on-time payment history, which is awful, but I've been steadily building that back up as well, and don't anticipate any further issues in that area.

My plan is to just keep on truckin' with on-time payment and low utilization. Do y'all have any other suggestions? Should I get another secured card so that the on-time payment average will go up faster. Of course, that will drop my average account age, which is at 2.14 now or something.

Also, a specific question: when should I pay my credit card bill? I mean, at what point in the monthly cycle? Obviously I don't want to pay it off late. But I've heard that showing 0% utilization isn't a good thing either, so I don't want to pay it off TOO early and have it report 0% to the agencies. Any advice?

Thanks so much for the help.

~Seth~

Anonymous · ‎05-18-2014

1. I would look to add another secured account or two, so that you have several positive accounts reporting. The SDFCU secured Visa is a good choice.

2. I would try to address any derogatories that you can, e.g. via goodwill letters.

3. If you have a CC with a $200 limit, I would make a payment before the statement date such that the reported utilization is around $10, and then pay the statement balance by the due date so as to avoid interest.

4. Another possible long-term angle would be to take out a secured installment loan, for example like the one offered by Alliant Credit Union.

guykara · ‎05-19-2014

Why is Alliant Credit Union recommended?

Starting Scores (10/18/2013): EX: 603 | EQ: 572 | TU: 659
5/05/2014 EX: 628 | EQ: 627 | TU: 623
5/25/2014: EX: 628 | EQ: 635 | TU: 623
Current Scores: EX: 670 | EQ: 663 | TU: 681
Goal Scores: 680 across the board

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Anonymous · ‎05-19-2014

@guykara wrote:
Why is Alliant Credit Union recommended?

I mentioned them because they offer secured installment loans, which may be a useful rebuilding product for some people in some situations.

CJIII29 · ‎05-19-2014

A share secured loan is a good idea as well.

Chase Slate Credit Card $1500 credit limit Best Buy Credit
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My Fico scores: Experian 710, Equifax, 702, Transunion 716.

Revelate · ‎05-19-2014

Because Alliant appears to have the best shared secured loan available on the market today: 4 years, 2% APR (or 5 years at 3% APR), $500 minimum, and I didn't get a HP either for membership nor for the share secured loan application.

Website interface is reasonable too once you figure it out, and you get a freebie quarterly Vantage score. Really hard to go wrong with Alliant in my opinion having used them for explicitly this purpose.

takeshi74 · ‎05-20-2014

@Anonymous wrote:
My plan is to just keep on truckin' with on-time payment and low utilization. Do y'all have any other suggestions?

Always address derogs first as they have the biggest impact. Visit the Rebuilding subforum.

@Anonymous wrote:
lso, a specific question: when should I pay my credit card bill? I mean, at what point in the monthly cycle? Obviously I don't want to pay it off late. But I've heard that showing 0% utilization isn't a good thing either, so I don't want to pay it off TOO early and have it report 0% to the agencies. Any advice?

It's not all-or-nothing. You can pay down the balance prior to statement end without paying it off entirely to allow the desired utilization to report.