How many accounts enough to build credit?

[SuperFlyEDSguy]

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@masscredit wrote:

@SuperFlyEDSguy @MarkyB I made TD my main bank in May... Hopefully I have a smooth ride with them. One benefit I've found is there are plenty of branches around me. 

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I had no issues with the people at TD, and their hours & locations were extremely convenient. I was even friendly with a branch manager that I knew through our local Chamber of Commerce. She helped me a number of times with banking issues that needed a quick manager's override to square them away. She seemingly knew everyone, so getting a name and number for the right person was never a problem either.

My issues though were BIG, and as I already said, if you have any judgements or may get any judgements, run like hell — Don't pass Go, don't collect your $200! — Just run! They even allowed them to garnish an account with nothing coming in except for social security deposits, which is a HUGE no, no! In retrospect, my other issue actually seems rather small in comparison as they were merely very picky about lending. I was never able to get my foot in the door there even when it was customary to loan all kinds of funds to businesses based on their EIN alone. I must have easily amassed $50K or more in business credit with Citi alone, but TD wouldn't give me a dime when it came to business credit, and of course not even a secured card personally. It's nice to have your credit cards where you bank, but YMMV. This was like 10-Years ago. At least there are oodles of choices now to get subprime credit cards to build credit without having to bring an offering in exchange! Actually, your scores are high enough to get approved for something unsecured (if interested) and considering how the secured cards don't show as secured on your credit reports that will go very well for you! I'd check to see if Credit Karma gives you any Outstanding Approval Odds and consider rolling with one or two of those. I've had very good luck that way myself!

Be well! ✌️

[SuperFlyEDSguy]

@MarkyBA couple things, first congrats on being eligible to graduate! I know, it's a pain waiting it out, but Discover is very good about customer service. If they say not to worry, the odds are very good that you don't have to worry! I literally became eligible to apply for a second Discover Card this week and put in the application today as I wanted their Miles card for a while now. I was thankfully approved! Oddly, Discover only allows you to have two credit cards with them and you could only get the second after the first has been open for a year or more. Just a tidbit regarding Discover, but my point was that their Customer Service is just awesome, otherwise I wouldn't have even wanted their Travel card in the first place! 👍

Second, I can't help, but ask what your limit is? Do you have a high utilization? I'm just trying to wrap my head around how an $80 charge put you OTL.

Finally, do you have any other cards to use for Apple? I use my Apple Card exclusively for Apple, so subscriptions come off the top. With a $1.5K limit, I barely ever go over $100 on any given month and that ensures there's plenty to keep my utilization low in general. I do the same with a couple of other cards too. This means even with, let's say, a $2.5K limit, that I may only have just one charge coming out on the same day each month for $9 or $10. Aside from focusing on keeping your utilizations low, which is a must, I would urge you to never spend on the debit cards as the dispute process is very different and you will not be afforded nearly the same level of protections that credit cards offer, e,g. from chargebacks to purchase protection! You're also responsible for A LOT more of the cost when claiming fraud on a debit card transaction! In comparison, you'd be responsible for none or very close to none of the cost when paying with a credit card. Go figure. ✌️

[SuperFlyEDSguy]

Congrats on getting the account opened! 👏👏👏

Now you're cooking with some fire! 🔥

[SuperFlyEDSguy]

Sorry. I missed this one. I've been on again & off again the past week or two.

So, basically from my experience and the experience of others, as long as a loan (personal, auto, mortgage, etc.) is reporting it'll give your scores a bump and also satiate those banks and credit unions that want to see an installment loan, a great example would be NFCU!

I was paying my 20 year student loan for 15.5 years-or-so. Like many things in life, it seemed like a good idea at the time to pay it off when I was able to. After paying it off my scores tanked an average of 20-points!!! On the other end of the spectrum, I recently consolidated my big payments down into a single loan payment at a slightly better rate. I used the FICO tool on Experian's website to estimate the change and they're estimating my score will go up by about 10-points!!! I hear similar stories from others, so it seems that keeping at least one loan regularly reporting is the wise thing to do. If you have a car payments or mortgage, after the initial shock, it'll work in your favor.

The only thing I would strongly recommended is to always take out a loan for a longer period if it reduces the interest rate, however make sure there are no penalties to pay early! Unlike your monthly payment where you're paying both principal and interest on an amortized schedule, any extra payments will count only towards paying the principal balance! So, if you could get the same loan terms, but let's say less 3% in interest by going 60-Months instead of 36-Months. Take the longer option provided no penalties and pay it off in 36-Months or less to get the savings.

To answer how loans compare to credit cards, even if a card gets closed, it doesn't fall off your report right away. So, there won't be an immediate shock from closing the account, not like with a loan anyways! It takes either a year or two to do so. If you have a good enough mix, closing a few cards won't affect you too badly. Just keep the oldest ones open and you'll be fine. I'm at a point now where my mix must be getting pretty good as adding new cards does not change my scoring! It's interesting to see these patterns develop over time!

Be well! ✌️

[SuperFlyEDSguy]

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@MarkyB wrote:

@SuperFlyEDSguy ... I'm not sure once I finish paying it tho, will it still count towards my score like a closed credit card would? Or does it just dissapear and have zero factor?

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I stumbled across the following link a couple hours ago and couldn't believe the irony as it explains things with a bit more eloquence than my initial shot at it. I would suggest reading it as it puts things into perspective very nicely.

One more thought, BTW. Loans are not revolving debt so they don't go against your utilization. This is the same reason why charge cards are not factored into your utilization. They too are not revolving as they're due in full with each new statement. My point being that loans factor into things like aging and paying on time, but not utiluzation. They also play a big part in your credit mix and that's where I believe the article explains it a tad better than I. Here's the link:

Here’s when paying off debt can actually hurt your credit score | CNBC Select 

Enjoy and please let me know if you have any questions. ✌️

[RobynJ]

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@SuperFlyEDSguy wrote:

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@MarkyB wrote:

@SuperFlyEDSguy ... I'm not sure once I finish paying it tho, will it still count towards my score like a closed credit card would? Or does it just dissapear and have zero factor?

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I stumbled across the following link a couple hours ago and couldn't believe the irony as it explains things with a bit more eloquence than my initial shot at it. I would suggest reading it as it puts things into perspective very nicely.

One more thought, BTW. Loans are not revolving debt so they don't go against your utilization. This is the same reason why charge cards are not factored into your utilization. They too are not revolving as they're due in full with each new statement. My point being that loans factor into things like aging and paying on time, but not utiluzation. They also play a big part in your credit mix and that's where I believe the article explains it a tad better than I. Here's the link:

Here’s when paying off debt can actually hurt your credit score | CNBC Select 

Enjoy and please let me know if you have any questions. ✌️

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I would have to say that although loans are not part of your Utl they do however give you more points at different Utl %'s during the loan. The sweet spot is at under 9%.

[MarkyB]

@SuperFlyEDSguy my CL is $300 and my reported utilization stays between 2% and 3%. I normally charge up the card close to the limit and pay it down before the statement cuts leaving just a small balance to report which I pay in full afterwards.

So Sunday I had submitted a payment to bring my balance down to $8. My statement ends on Sunday this week (4 days from now) so I normally pay the balance down a week before. My balance was at $221 and change. I woke up Monday morning and noticed my balance was the same (payment didn't post until Tuesday) but my available credit was at -1. That's when I knew something was wrong. I looked at the transaction history and seen a random apple charge for $80. I was confused as to how the charge didn't get denied by discover. Frankly I still don't get it so that's why I removed the card altogether. I don't have a apple card to use. I only have my cap1 and disco cards. I will use my debit from now on.

Apple really dropped the ball charging me on a subscription I had cancelled with full confirmation. I'm just glad it didn't have the negative impact I feared it would on my account.

[MarkyB]

@RobynJ yup around 8% to 9% remaining balance is when you benefit the most cuz at that point you've proved you can pay off a loan. I'm likely going to pay down my loan a month before I apply for a loan to get those extra points.

I was just curious on the monthly fico change because with VS3.0 you get a couple points per month for paying down the loan. Each loan payment reported gains you some points.

[MarkyB]

Looks like I got my answer lol. My monthly credit score update refreshed just now through the experian creditworks premium membership I have. My EQ fico8 went up 24 points from 705 to 729 after my new loan balance updated. My TU score stayed the same at 660 (can't wait until January to get that collection file removed) and my EX still hasn't updated the new loan balance yet but I'm betting my EX score goes up too. My EX fico8 updates daily so I'll find out soon when it does.

My loan balance went from $423 to $403 (25% paid). EX is normally the last to update the new balance every month. Hopefully by tomorrow or Friday it should reflect.

[SuperFlyEDSguy]

The good thing here (if there truly is one) is that Apple is very good about refunds. I even got a refund recently for a subscription that we simply forgot to cancel, so we canceled it, and quickly let them know. They ended up refunding it within 48-hours.

Your situation sucks though because debit cards are exponentially harder to dispute charges on! If those are the only two credit cards you have, I'd consider a secured card with a higher limit or checkout Credit Karma's recommendations as your scores should get your foot in the door on something unsecured and w/o an AF! Those were the same scores that got me my first [unsecured] cards after a very, very long time! 

I could imagine how shocking this was and definitely feel for you. Just a couple years ago I couldn't even get approval for a secured card, so having options is a truly great thing! Please do let us know when you graduate! 

Be well! ✌️