Rebuilding with questions

[Anonymous]

Greetings,

I am a short term lurker, first time poster with a few questions.   I have begun the process of rebuilding my credit.  I don't have anything too crazy on my record, 2 very small collections (50 dollars each for a medical co pay which I am going to pay off so they can be marked as closed), I have one charge off from Ginney's mail order catalog from 6 years ago, and an eviction from 2 years ago which simply shows on my credit report as a legal matter with no financial information.

Kohls sent me a pre qualified letter one day a few months ago.  I almost threw it away because who would give this girl credit?  I figured they were just trying to sucker me in because I shop there so much.  I have no idea why I applied but I did and they approved me for 300.00.  I have made all my payments on time.    While shopping on HSN which I do rather frequently, I recieved a pop up for a pre approved credit card.  Naturally I was super excited and said yes.  I was approved for 750.00.  Now I figured this was definately a result of my frequent shopping and at that time I knew nothing of the shopping cart trick. 

Around the same time, I applied for a Credit One credit card and didn't get an immediate approval, just a message stating they would contact me so I figured it was going to be a big NO.  A few weeks later I tried for a Capital One and was approved for 300.00.  Right after that,  Credit One sent me a letter saying I had been approved for 400.00.  So here I was a girl with no credit cards and suddently I am getting some credit.  I learned about the shopping cart trick and was able to get it to work for Overstock and Blair but nothing else.  Boo

So with all of that, my scores at the start were 514 and 540 respectively on credit karma.  They have since gone up to 616 and 634 respectively which I think is great in such a short amount of time.  Credit One showed my score with Experian at 629 when they ran my credit for their card.   So my main question is how long would it take at this rate to get my scores in the 700's?  Ideally I would like to buy a car and not have 19% interest rate that I have typically paid previously.  Is there anything I should be doing differently?  Am I on the right track?  How long after I have had my cards should I be asking for CL increases?  I don't want to look desperate but I also want to get some cushion on that utilization.   Have I overlooked anything?   Thank you for any info you can share.

[creditguy]

No one can say with any certainty how long it will take for you to reach 700 scores. The first thing you need to be aware of is, using scores from credit karma are pretty worthless because they are fako scores and can either be close to accurate or way off. CK is good for info but scores are a no go.

So far you are off to a good start. For optimal scoring purposes, you only need three credit cards and an installment loan. Your good on cards, so consider adding a small loan. This can easily be achieved by going to a local credit union and getting a secured loan. In the meantime avoid getting anymore cards in the near term, especially store cards or any additional fee heavy sub prime cards.

The only thing you need at this point is time and patience. Use your cards, pay them off and keep utilization low, ideally nine percent or lower overall. As time goes by your AAoA will increase and your inquiries will age lessening their impact on your scores. Work your capital one card the hardest and request a CLI every six months, it has tremendous growth potential. Right before your one year anniversary, cancel the credit one and save yourself the AF, it's a limited growth card that can be expensive. Finally work on getting a PFD on those collections, even though you pay them off, they will still remain on your CR holding back your scores. There is a wealth of info on this in the rebuilding section. Congrats on your success so far and good luck on your future endeavors.

[Anonymous]

1) Congratulations on your success so far😃
Good job
Be careful though, you should IMO avoid jumping for anymore of the low tier feeders...you have enough to ignore them, you don't want to get stuck with too many bottom feeder cards, like the Credit Ones of the world.

2) To answer your 1st question about getting a 700 score (assuming you mean a Fico, not CK )
It's a tough question B/C if you keep your debt loads low, you 'could' reach 700 by X-mas
But even if that happened your profile would still be thin and treated as such.
Your score is just the 1st gatekeeper, the easiest way to say NO...a 'weakly' generated 700 score, will be judged for what it is.

3) Car credit isn't that hard to build towards at least decent rates and in today's climate of ultra low APRs it'd be HARD to fine rates as bad as 19%.
You didn't say if you have Repo's or relatively recent baddies regarding autos, because lots of places will run an auto enhanced Fico score and if you've been pretty clean with cars, you may be surprised.

Some lenders give a you extra kudos if you kept the car paid, even if the CC history wasn't great.

Otherwise you're doing fine, just keep your reported balances LOW and let TIME do it's thing for you.

[takeshi74]

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@Anonymous wrote:

I don't have anything too crazy on my record, 2 very small collections (50 dollars each for a medical co pay which I am going to pay off so they can be marked as closed), I have one charge off from Ginney's mail order catalog from 6 years ago

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The amounts really don't matter.  These are derogs and they will hold your scores down and they will be red flags to creditors while they are on your reports.  Carefully research in the Rebuilding subofurm and see what you can do to address them.

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@Anonymous wrote:

I have no idea why I applied but I did and they approved me for 300.00.

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Approval is generally a low bar to clear despite what many seem to assume.  The very low limit indicates that the creditor has concerns with your credit.  It's not just about getting approved.  Your credit profile is a significant consideration for the limit, APR, etc that you qualify for.

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@Anonymous wrote:

So my main question is how long would it take at this rate to get my scores in the 700's?

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It is not just about the passage of time.  Any score is generated based on the data in a report.  How long will it take for those derogs to be removed from your reports?  What are the other issues on your reports and how long will it take to address them?

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@Anonymous wrote:

So with all of that, my scores at the start were 514 and 540 respectively on credit karma.

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You can use the scores at CK to track general trends with your credit but keep in mind that if you want to know where you stand with a creditor score-wise then you need to know the model and the CRA that the creditor uses in its decision and then go pull that specific score.  You cannot use a score generated by one model to determine a score generated by a different model.  CK's scores are only relevant to creditors that use a TU or EQ VantageScore 3.0 in their decisions.

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@Anonymous wrote:

How long after I have had my cards should I be asking for CL increases?

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Again, it's not just about the passage of time.  Rquest CLI's when your reports improve.