Tips for a credit Newbie?

[Anonymous]

Hi Guys! 

I've been lurking on this site for a few months now and I finally decided to sign up & join the conversation. Here's a little backstory: I'm in my late 20's but I didn't start paying attention to my credit until Decemeber of last year. I come from a family that didn't know much about credit and I was always taught that you if you didn't have the cash to buy something, you simply didn't need it. Fast forward to Spring of 2017,  I managed to pay off a few collections and dispute a few things which brought my score up 100+pts. I've been hovering at a 661 score for about 4 months and I'm interested in making this jump. This is what my "profile" looks like currently: 

-Comenity Ulta Credit Card ($150; First CC ever-- opened Nov 2016)

-Cap 1 Auto Loan ($15,000 ; 20 yr old Honda clunked out-- opened Feb 2017)

-Cap 1 Platinum Credit Card (SL- $300; increased to $500 yesterday-- opened May 2017)

-Amex Everday ($500; embarrassing-- Hit the luv button after 61 days, denied-- opened Aug 2017)

-Discover IT ($1,200-- Opened Nov 2017)

-Student Loan for two degrees ($50,000)

I'm happy with the cards I have now, I'm not really interested in applying for more. I think I have some decent ones to start with and its time to start gardening. I'm nervous about being stuck with low limits forever-- I've read about people having difficulty getting their cards to grow because they initally received them with such low starting limits. Any tips on avoiding this? 

[Anonymous]

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@Anonymous wrote:

Hi Guys! 

I've been lurking on this site for a few months now and I finally decided to sign up & join the conversation. Here's a little backstory: I'm in my late 20's but I didn't start paying attention to my credit until Decemeber of last year. I come from a family that didn't know much about credit and I was always taught that you if you didn't have the cash to buy something, you simply didn't need it. Fast forward to Spring of 2017,  I managed to pay off a few collections and dispute a few things which brought my score up 100+pts. I've been hovering at a 661 score for about 4 months and I'm interested in making this jump. This is what my "profile" looks like currently: 

-Comenity Ulta Credit Card ($150; First CC ever-- opened Nov 2016)

-Cap 1 Auto Loan ($15,000 ; 20 yr old Honda clunked out-- opened Feb 2017)

-Cap 1 Platinum Credit Card (SL- $300; increased to $500 yesterday-- opened May 2017)

-Amex Everday ($500; embarrassing-- Hit the luv button after 61 days, denied-- opened Aug 2017)

-Discover IT ($1,200-- Opened Nov 2017)

-Student Loan for two degrees ($50,000)

I'm happy with the cards I have now, I'm not really interested in applying for more. I think I have some decent ones to start with and its time to start gardening. I'm nervous about being stuck with low limits forever-- I've read about people having difficulty getting their cards to grow because they initally received them with such low starting limits. Any tips on avoiding this? 

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Welcome to the forums 

Cap1 is known for not growing if you're in the wrong bucket. Sometimes you can go to the check for upgrade link and take another card to get rebucketed, but no promises. Others can speak better for Comenity. Amex and Disco though... they will grow. A lot with the right profile. My Disco started at $600 (secured) and look at my siggy now. Since they're SP's, you can keep growing them while in the garden.

To help your score in the short term, keep your revolving util low (~1% or less at statement cut) and PIF the next day (Not to be confused with carrying a balance -- that doesn't help your score and it just costs you money in interest).

I wouldn't recommend opening any more cards until yours grow a bit. When do your baddies fall off?

Along with the above, just keep paying down your loans and you'll be in the 700 club soon. Best of luck!

[SouthJamaica]

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@Anonymous wrote:

Hi Guys! 

I've been lurking on this site for a few months now and I finally decided to sign up & join the conversation. Here's a little backstory: I'm in my late 20's but I didn't start paying attention to my credit until Decemeber of last year. I come from a family that didn't know much about credit and I was always taught that you if you didn't have the cash to buy something, you simply didn't need it. Fast forward to Spring of 2017,  I managed to pay off a few collections and dispute a few things which brought my score up 100+pts. I've been hovering at a 661 score for about 4 months and I'm interested in making this jump. This is what my "profile" looks like currently: 

-Comenity Ulta Credit Card ($150; First CC ever-- opened Nov 2016)

-Cap 1 Auto Loan ($15,000 ; 20 yr old Honda clunked out-- opened Feb 2017)

-Cap 1 Platinum Credit Card (SL- $300; increased to $500 yesterday-- opened May 2017)

-Amex Everday ($500; embarrassing-- Hit the luv button after 61 days, denied-- opened Aug 2017)

-Discover IT ($1,200-- Opened Nov 2017)

-Student Loan for two degrees ($50,000)

I'm happy with the cards I have now, I'm not really interested in applying for more. I think I have some decent ones to start with and its time to start gardening. I'm nervous about being stuck with low limits forever-- I've read about people having difficulty getting their cards to grow because they initally received them with such low starting limits. Any tips on avoiding this? 

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Nothing is forever. The most important equation in the FICO world is:  passage of time + no negatives + no new credit = rising scores.

[Anonymous]

First thing I would do is upgrade that Capital One Platinum to the Quicksilver so you can earn cash back. They are upgrading pretty much anyone. Just log into your capital one account, hit Contact us at the bottom, wait a second then top right click "Chat Online" then ask for the upgrade

[Anonymous]

As mentioned above, your Capital One card likely won't every grow.  Not significantly anyway.  If you are at a $2500 limit with them 3 years from now I'd be shocked and by then your discover will probably be at 5-figures, as may some of your other cards.

To give yourself the best chance at a CLI with almost any lender, you want to use the card heavily and PIF every cycle for several cycles leading up to a CLI request.  This may mean moving some spend from other cards to the card that you're looking to grow, as it will increase the spend on that card.

As far as growing your scores, correctly advised above is simply to let time pass.  Always pay on time every month, keep utilization low and don't apply for any new credit that you don't need.  That's all there is to it really.

As far as what you can do to get your score to "jump" upward some, there's really only 1 thing.  You need to get all of your negative items removed from your credit report.  To do this, I suggest reading the rebuilding forum and start tackling those negative items with your creditors.

[Anonymous]

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@Anonymous wrote:

To give yourself the best chance at a CLI with almost any lender, you want to use the card heavily and PIF every cycle for several cycles leading up to a CLI request.  This may mean moving some spend from other cards to the card that you're looking to grow, as it will increase the spend on that card.

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The only thing I would add to this is that the single most important habit for people to develop with managing credit cards is reducing spending.  That means developing an awareness of how you spend money and asking yourself each time -- do I really need this?  Could I find a way to be happy without buying this thing?

BBS and I know each other well from this forum, so I am pretty confident that when he advises that you heavily increase spending on the card he means that in a way completely consistent with reducing spending overall.  That's why he suggests rechanneling spending that might otherwise be spread out onto one card.

The bottom line danger is that if you find that, in an effort pursue a CLI, you are buying even one thing you don't really need (to create heavy spending) then you have just paid an annual fee for that card.  Losing money is never worth the bragging rights about a big CL.  Remember that the bigger CL does not in itself increase your score by even one point.

[Anonymous]

I agree with everything CGID stated above.  When I suggest using a card heavily, I don't suggest any additional spending in order to do so.  I just mean things that you may normally pay for in cash or use a debit card for, use your CC for instead and just pay it off immediately.  I have not used cash in about a year and a half and have not used a debit card longer than that, all because I channel my spend through my CCs.  All of your monthly recurring bills and most monthly expenses can be put through credit cards to increase your spend.  By doing this, your increased spend will usually stimulate a CLI from the creditor, as you're giving them a great reason to give you a CLI. 

[CA4Closure]

Pay down that student loan then car loan. For the other cards, limit your spending and keep that same adage, if you cannot afford it do not buy it! You do not want a auto repossession or collection hit on your credit report.

I only buy if the item is on sale or I really need that item.

[Anonymous]

Hello,

I would give advice and say you have to much credit and this is the reason or one reason your score is going up any further. It maybe hit you a bit but you van build from here, if you have one installment loan (car), one revolving or 2 and leave it at that and keep your balances below 30% and on time payments each month. At this point you will see a increase. You also can't expect a fast turn around for increase. Maybe after lowering your debt, around 3 to 6 mths you'll see a big change. Hope this helps.

[marty56]

The secret is getting your CLs to grow is to look elsewhere if they don't.  For now just garden and as your scores go up, the offeres will come to you.  It takes time to build good credit.  I would foucs on getting ride of the student loan since that is the long term threat to your credit and financial future.