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I paid off all my collection accounts a few months back.(GW letters sent) my current score is 597
I have a 2k loan form my bank been paying for 6 months
Wells Fargo secured card 300 limit. Paying for 6 months
12k car loan paying for five months.
I just got a pre approval form Credit one for $300.00 should I take it?
I want to buy a house, what is the best course of action to get my score up to 640?
I have also been thinking about increasing the limit on my secured card.
Any ideas?
You could increase the limit on your secured card. You don't need credit one at this point in your credit build. The fees are too high. I would add another credit card so doyour research and find a unsecured card you may qualify for. Just pay on time and don't charge more than 30% of your credit lines and your scores should improve. When you will be able to qualify for a mortgage may take a year or so. Time and patience should get you where you want to be. Good luck!
@bhenken08 wrote:I paid off all my collection accounts a few months back.(GW letters sent) my current score is 597
I have a 2k loan form my bank been paying for 6 months
Wells Fargo secured card 300 limit. Paying for 6 months
12k car loan paying for five months.
I just got a pre approval form Credit one for $300.00 should I take it?
I want to buy a house, what is the best course of action to get my score up to 640?
I have also been thinking about increasing the limit on my secured card.
Any ideas?
How soon are you looking at applying for a mortgage?
Right now, everything you have is 6 months or less which means if you took the $300 from credit one, you'd not only be wasting money (don't they have some obscene AF plus then monthly fees?) you'd also be getting a small $300 credit limit that really won't do much for you at this point (or any point going forward).
Honestly I would take whatever the AF and monthly fees credit 1 would charge you and start putting it onto your secured card. If you can afford $100 a month, start adding that to your credit limit. Doing so means in 6 months, you'd have a $900 credit limit - which will mean keeping Util low will be much easier than trying to keep util low on 2 different cards that are at $300.
If your ok waiting MORE than 6 months to app for a mortgage, try to app for an unsecured card that DOESN'T have ridiculous fees - Walmart may be a stretch for your score, but may be obtainable if you currently have a low utilization, not TOO many inquiries on your report (though most will be at the 6 month mark it looks) and no open collections or unpaid chargeoffs. That is a card that will grow and they seem to be in the christmas spirit.
Either way right now, you have 2 loans right now, a car loan (totally understandable) but also a loan for 2k which appears to be unsecured (not backed by an asset like a house or a car) unsecured loans generally have extremly high interest rates in comparrison because the bank has nothing that it can seize to get its money back so there is much more of a risk. If you were to apply for a mortgage today, they would see that you took out a loan for 2k in the past 6 months, that would be a major issue since its not paid off. They will ask "why did he need a loan that for a 'small' amount that wasn't for something like a car?" its a red flag if its still open when you go to apply, it also will hurt your Debt To Incom ratio. So I'd spend the next 6 months or less working on paying that off. I wouldn't apply until its paid off in full and closed before even talking mortgage. The car loan you don't have to worry about, but like all things money the longer it takes to pay the more you spend - but as long as you've been paying it on time and paying your full monthly payment you shouldn't have to worry about it setting off a flag.
I think you really need to wait at least a solid 6 months to even think mortgage. A year would be even better.
Avoid Credit One if you can. I have it, and will be closing it soon. $75 activation fee and it costs me $10/month just to carry it. I would increase the secured CL
+1
I would like to buy a house in the next 6-12 months, it makes no sense to pay rent when I can buy a house for what my rent is now.
The 2k loan was a loan to pay off my collection accounts. I could pay it off quicker but I was told to go full term to build a good payment history.
So I guess my best bet is to raise my secured card limit and pay off the 2K loan?
If I get ahead on my car payments does that help my credit score?
@bhenken08 wrote:I would like to buy a house in the next 6-12 months, it makes no sense to pay rent when I can buy a house for what my rent is now.
The 2k loan was a loan to pay off my collection accounts. I could pay it off quicker but I was told to go full term to build a good payment history.
So I guess my best bet is to raise my secured card limit and pay off the 2K loan?
If I get ahead on my car payments does that help my credit score?
If I am not mistaken getting ahead on the car payments doesn't really affect your scores, if it was paid off sooner it could actually drop your score a smidge. I would definately increase the Secured card though. I am sure someone here could chime in on the car and 2K loan, as I am not for certain.