Credit Mix Questions

[stinastina]

I just realized I don't have an installment loan. I have 4 credit cards and 1 store card. How important is it to my score to have one ? I did the score simulator on CCT and it said my score would go down 4 points if I add an installment loan. Does that sound right ?

Also, the best I can do right now is Fingerhut. They sent me a pre-approval for $400. Should I wait until I have $500 and do the Alliant credit building loan ? That might be a couple of months.

My goal right now is to get my TU up to 630 because I need a lot of dental work and want to apply for Care Credit. My next goal is to get my EQ up to 650 so I can apply for Penfed. In 3 months I should be able to apply for a new NFCU card and LOC. I have one NFCU go rewards but only a $1000 limit.

[Anonymous]

It will raise your score in the long run not lower it. Check out the link below it gives a wealth of information. I recommend using Alliant Credit Union as there is no hard pull for membership or the share secured loan. http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Adding-an-installment-loan-the-Share-Secu...

[DollyLama]

Agreed, wait till you have the $ and do the Alliant as stated, with due date years ahead and utilization under 9%. The simulator you used is not factoring in taking out a loan and leaving a very low balance. It assumes you will be at 100% in the beginning.

[stinastina]

Thank you both for your advice. So the main difference in between alliant and Fingerhut would be the hard pull ? Waiting is such a hard lesson in credit building !!

[Anonymous]

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@stinastina wrote:

Thank you both for your advice. So the main difference in between alliant and Fingerhut would be the hard pull ? Waiting is such a hard lesson in credit building !!

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The real difference is who would you rather a potential creditor see on you report Fingerhut or a prominent credit union.

[medicgrrl]

Isn't Fingerhut only an installment for a short time and then convert's to revolving?

[stinastina]

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@Anonymous wrote:

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@stinastina wrote:

Thank you both for your advice. So the main difference in between alliant and Fingerhut would be the hard pull ? Waiting is such a hard lesson in credit building !!

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The real difference is who would you rather a potential creditor see on you report Fingerhut or a prominent credit union.

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Right but I was thinking about doing this for the immediate credit boost. And I don't have an extra $500 for Alliant at the moment.

[stinastina]

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@medicgrrl wrote:
Isn't Fingerhut only an installment for a short time and then convert's to revolving?

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It is. Only for 6 months. Then I could do the Alliant plan.

[stinastina]

More questions, please !  So I realized NFCU has a credit building loan, too. The lowest amount is 250 and it's for 6 months. I can do that with my next check. They also release the hold on the funds with each payment.

My questions are - is it fine to go with the low amount and 6 months since that's what I can afford ? Or is it better to wait and do 500 over 12 months ? I want an immediate boost so does 12 months or six months matter ?

[medicgrrl]

You're better off doing a longer term unless you plan on open some other loan soon, like auto or student loans etc