@Anonymous wrote:
I haven't see anywhere if extra money can help build your credit. I have a 520 credit score due mostly to 4 accounts going into collections four years ago due to dumb mistakes I made. They total around $5,000 Slowly I worked back up to 590. Then got layed off at work a few months ago and didn't make my capital one secured card payment. It was on auto pay and I had no idea the payments where returned until I got the mail saying they were closing the account. I am back to working now and have 6 months of bill money in savings for if I ever get layed of again. I also have another $30,000 on top of that. (Lay off was a blessing I got a great job eventually) the only thing I have financed right now is an auto loan I still owe $16,000 on. I figured I should keep paying this to increase my on time payments. I read that opening a secured card will improve my credit which is why I got the Capitol One card in the first place. Also I understand high credit limit helps. Would putting say $5,000 on a secured card be beneficial or is it not worth tying that much money up? Is there anything besides just keep paying my bills that this excess money would help with?
Have you paid off the collections?
Have you paid off the Capital One?
How long have you had the auto loan? How much was the original loan for?
Putting x $ on your secured card will raise the limit when it unsecures. That's the only direct benefit.
Money helps to pay off old debts, but that's about it. Many people with very little income have great credit. It's all about managing what you have and being mindful of what can happen if it goes wrong. Having 6 months of bill money is exactly the right thing to do. I also think it's wise to never put on credit cards what you can't PIF in a pinch. Sometimes things happen, of course, but it's a good rule of thumb. The more money you have saved up, the more money you can churn to raise your limits.
