@Anonymous wrote:Hello,
I'm paying off a lot of old debt to get my scores up and I'm thinking once some of them are removed, I'm going to need to get a credit mix in good shape. I have zero credit cards (just old debt that was charged off/settled/paid/updated reports to paid). But one lone old credit card is showing closed but only good activity. Horizon. Should I contact them to try and reopen that so that it will look good for my mix as well as age of accounts?
I am a little bit confused by this.
You have zero open credit cards, correct? Now, based on what you wrote, you have had credit cards in the past, but all are closed (best I can decipher - all are in closed/charge-off status????).
I also - just to put this out there - believe that you might be worrying about something (credit mix) that is - in my humble opinion - totally secondary to your biggest challenge (assuming, naturally, that I have deciphered your post / question correctly): the charge-offs.
How many charge-offs do you have? And from where are you getting this information? Have you looked at your credit reports (one from Equifax, one from Experian, and one from Transunion) recently? Are there collections accounts associated with the credit cards that are charged-off?
And, please forgive me if I have misunderstood your post.
Starting Score: Exp 627
@Anonymous wrote:Oh my gosh, of course you have questions! I forget that you're all not in my head and can't read minds etc. I wrote a different post about all my debts and where I was.
So more details.. the charge offs are all paid (settled for less), some of those are remaining, not removed. But they are paid. All my credit scores are increasing right now because of that progress. So as a result, I kept seeing that Horizon closed account in good standing, I thought, well... I'm not going to have any accounts that are going to show in good standing, because I have no OPEN credit card accounts. So would it be useful for me to reach out to Horizon to see about opening that back up. So that I could have 1-an open account and 2-an account that's several years old.
All good. I have seen some of your recent posts so I had a bit of an idea (but do we want to trust an old man's memory....and do we want an old man - or anyone for that matter - to ass/u/me anything???? LOL).
And that (paid charge-offs, but settled for less.....not really important from the FICO8 scoring perspective to be honest) is going to help you a ton....as you are seeing. The key to the paid charge-off is that the balance is now $0 *AND* it is no longer updating weekly/monthly. These two things are key.
Why? Because a charge-off counts against your revolving utilization as long as there is a balance (read: as long as the balance is something different from $0). So, once a charge-off shows a balance of $0, you are free of that burden (with the term 'burden' exlusively referencing the utilization hit here....in the way that I am explaining things here). And, once you make that payment that brings your balance down to $0 the OC is no longer supposed to update this account. This allows the charged-off account to age....and with age comes a few good things.
So, your score is no longer being suppressed (because of the OC updating the account every week | every month) and your score improved because of the "utilization" situation.
Now, if Horizon is a company with whom you had a credit card and that card was closed then that specific card is closed. It will continue to show on your credit report - assuming that it was positively reported (and you suggest that it is) - for up to 10 years. Does not mean that it will show up for 10 years (as a closed account....but something nonetheless).
Maybe contact them again and see if you can open an account with them again, based on your previous relationship. No clue as to who they are and if they would entertain your request. But you miss every shot that you do not take, right?
In your case, I might consider a secured credit card. I think that this is likely your most prudent move.
OpenSky could be really useful to you. They do not do a credit pull. They do have a $35 AF. They offer no rewards or cashback. And they do not graduate (meaning, this card will forever be a secured card). But, it is a credit card that reports to all three CRA.
Discover or Capital One might be another really good idea. I would - to be completely honest - go with Discover first. I fear that Capital One would bucket the secured card (were you to get one from CapOne) and it would stay "as-is" for a really long time. So, if we know that, why bother (all things being equal).
Discover does graduate you (as soon as eight months), they do offer cash-back, they match all of the cash-back that you earn in the first year (so, it is doubled.....you effectively get 4% for gas and restaurants and 2% for everything else), and they will likely (likely....key word) give you a CLI once your card graduates.
Make sense?
@Anonymous, while I have never tried, I have read here and elsewhere there is virtually a zero percent chance you will be able to "reopen" your old credit card account; that said, they may well approve a new application from you which will report as completely new account with no relationship with your original account.
You can certainly try to have it reopened, but it's highly unlikely they would do so. Creditors don't generally reopen closed accounts, even if they were closed in good standing.
@OmarGB9 wrote:You can certainly try to have it reopened, but it's highly unlikely they would do so. Creditors don't generally reopen closed accounts, even if they were closed in good standing.
If I recall correctly there was a thread around here a few months back which talked at length about attempting, and failing, to reopen former accounts. My memory may be faulty, but I seem to remember only one individual reporting they's successfully reopened a closed card, and said card had only been closed for a few weeks; all other reported attempts ended without a reopening.
@Horseshoez wrote:
@OmarGB9 wrote:You can certainly try to have it reopened, but it's highly unlikely they would do so. Creditors don't generally reopen closed accounts, even if they were closed in good standing.
If I recall correctly there was a thread around here a few months back which talked at length about attempting, and failing, to reopen former accounts. My memory may be faulty, but I seem to remember only one individual reporting they's successfully reopened a closed card, and said card had only been closed for a few weeks; all other reported attempts ended without a reopening.
Correct, I believe it was an Amex card or something. But closed accounts that have been closed for months/years definitely aren't getting reopened.