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Should I go for a 2nd CC while rebuilding?

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Established Contributor

Re: Should I go for a 2nd CC while rebuilding?

It’s weird you didn’t get Citi I got them with a 494 and rest in signature, 15-17 negative accounts including charge offs and collections, and none were paid at all and they approved me instantly for the secured card. Even my student loans that were open was apart of my late accounts.






Starting Score: 494 503 521
Current Score: 503 507 507 2/19
Goal Score: 680


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Message 11 of 20
Established Member

Re: Should I go for a 2nd CC while rebuilding?

I did call merrick and have no delayed interest. I also was just approved for citi back secured card. Have to find the 400 by the 17. Which is perfect.
Message 12 of 20
Community Leader
Senior Contributor

Re: Should I go for a 2nd CC while rebuilding?

Sounds good on Citi. Check that Merrick account anyway. The CSRs you speak with aren’t usually the most knowledgeable people in the credit world. I would not put the potential ruin of my rebuild into their hands.


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Message 13 of 20
Valued Member

Re: Should I go for a 2nd CC while rebuilding?


@Brooklyn2018 wrote:
Welcome to MyFICO Forums!

To be honest, and opinions may vary here...but, unless you take care of the CO’s your utilization is going to sting every month moving forward. Congrats on your approval, btw. The more you read the more you will learn that utilization is very important regardless if you have 1 cc or 20 cc’s. Keeping it under 30%(8.9% is ideal for the most FICO pts you can squeeze out) Having CO’d off cc cards with balances are hurting your utilization and until you take care of them they will continue to keep hurting your attempts to raise your scores.
I had the same problem last year with just ONE CO cc for $136, which, was hurting my utilization and with my scores being so low at the time it was near to impossible to mask that amount with HIGH CL’s. So, I had to pay it to begin a “clean” utilization “start” and my scores began to recover, slowly.
So, unless you can be approved for HIGH limit cards(?) which at this point you won’t...IMHO and IMOE, I would do what I can to pay off/settle the CO’s to begin that “clean UTL start.”

Hope that helps some.

Good luck!🤞

Note: IMHO, I would try and take care of the CO’s before applying for anything else. Once your scores start recover you should be in a better position for your 2nd cc...just MHO, and as always, YMMV.

How do you get those pictures of the cards in your signature? 

Message 14 of 20
Valued Contributor

Re: Should I go for a 2nd CC while rebuilding?

Message 15 of 20
Established Contributor

Re: Should I go for a 2nd CC while rebuilding?

Can anyone explain why a card that is 100% covered with a security deposit would be denied to anyone based on credit? I can understand denying it based on inability to verify identity, or maybe no banking account.

 

I started a similar process recently with EQ 625 TU 510 EX 510, with two collections and one charge-off, and only some very minor (actually not even real) positive lines of credit, that appeared only on EQ (because they mistakenly left them active seven years after they were in reality closed).

 

I was approved for Citi secured, $200 deposit, $200 limit.

I was approved for Capital One secured, $199 deposit, $300 limit.

I was approved for Primor Green Dot secured, $300 deposit, $300 limit.

I was approved for a Self Help loan.

I was approved for MyJewelerClub $5000 limit.

I was denied for Discover It secured ... ?!? Again, why would they deny you a SECURED card? I don't think I've ever burned Discover.

I was denied for a couple of non-secured cards I tried for (credit union and I think I tried for a Home Depot card - in retrospect, I shouldn't have even tried, but I hadn't done much research at that point)

 

To answer the question, not that I'm an expert, but I think you should get three secured cards now so they can start building credit. If and when you get the derogatory items removed, they will vanish as if they were never there. For example, whether you remove them in June or remove them in October, your credit will still be the same in December. Somebody correct me if I'm wrong. Meanwhile, if you get the secured cards now, come December, you will have six months of history with three (vs one) cards, so, the advantages to getting more secured cards today is greater than the value of working on the derogs first. Of course, it would be best to do both.

 

Good luck!


FICO 8 scores are deceptively high. My profile is young with a lot of new accounts and even more inquiries from 2019. The Barclay AU card is not on TransUnion; and, Equifax has some old positive accounts from 2011 that are not on the other two. That is the reason for the variation in scores. No derogs. Over 5/24 until fall 2021.
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Authorized user / Corporate / Auto loan

Closed but still on reports: ExxonMobil, $950, 10/08-02/11 (Equifax only) | Citi secured, $200, 045/19-09/19 | Capital One secured, $300, 04/19-08/19 | My Jewelers Club, $5,000, 05/19-08/19 | Green Dot Primor, $300, 05/19-08/19 | Self Lender secured $500 loan, 04/19-01/20 | Unsecured personal loan from Coastal, $1,000, 06/19-08/19.

Goals: Late 2020 - Ducks Unlimited card; scores in high 700s with inquiries aging. Long-term goal - Prime rate mortgage; able to qualify for most standard credit products.
Message 16 of 20
Established Contributor

Re: Should I go for a 2nd CC while rebuilding?

I feel even though its your money your putting in there you can still max it out and end up over the limit and put yourself in a situation where you can’t pay it back. Just because you make your own limit doesn’t mean the same rules for a credit card shouldn’t apply because the same things can happen rather its a secured card or regular credit card and those things are you defaulting on it.





Starting Score: 494 503 521
Current Score: 503 507 507 2/19
Goal Score: 680


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Message 17 of 20
Established Contributor

Re: Should I go for a 2nd CC while rebuilding?

You could end up with a balance larger than your deposit due to late fees etc, but, those would not have the same cost for the credit card company that it has for consumers. In other words, if you have a $250 balance against a $200 deposit due to late fees, that is not because the credit card company is risking or losing $50 extra dollars. Their loss would be much smaller based on whatever their expenses are to bug you to make your payment + any interest rate they pay to carry the balance themselves. It would be probably be a lot less, I don't know, $5, $10? In my case, Capital One gave me a $300 limit for a $199 deposit, so it's hard for me to compute Discover not giving me a 1:1 card balance.


FICO 8 scores are deceptively high. My profile is young with a lot of new accounts and even more inquiries from 2019. The Barclay AU card is not on TransUnion; and, Equifax has some old positive accounts from 2011 that are not on the other two. That is the reason for the variation in scores. No derogs. Over 5/24 until fall 2021.
Cards

Authorized user / Corporate / Auto loan

Closed but still on reports: ExxonMobil, $950, 10/08-02/11 (Equifax only) | Citi secured, $200, 045/19-09/19 | Capital One secured, $300, 04/19-08/19 | My Jewelers Club, $5,000, 05/19-08/19 | Green Dot Primor, $300, 05/19-08/19 | Self Lender secured $500 loan, 04/19-01/20 | Unsecured personal loan from Coastal, $1,000, 06/19-08/19.

Goals: Late 2020 - Ducks Unlimited card; scores in high 700s with inquiries aging. Long-term goal - Prime rate mortgage; able to qualify for most standard credit products.
Message 18 of 20
Established Contributor

Re: Should I go for a 2nd CC while rebuilding?

Well my Wells Fargo Secured card went over limit almost $100 after it charged off so the same risk still apply the bank just gets part of their money sooner rather than later.





Starting Score: 494 503 521
Current Score: 503 507 507 2/19
Goal Score: 680


Take the myFICO Fitness Challenge




Message 19 of 20
Moderator

Re: Should I go for a 2nd CC while rebuilding?


@aglarry wrote:

Thanks for all the replies.

 


@gdale6 wrote:

Welcome to the board Smiley Happy

 

You actually need 3 open revolvers to drive Fico in a rebuild so I would open 2 more. OpenSky offers secured without a credit pull. Also check the Capital One prequal to see if you can get an unsecured rebuilder there. For each of the first 3 revolvers that open there is a bump to Fico.


I actually did the prequal for Capital One and nothing showed. Decided to app anyway the other day and was denied. If I were to have 3 open CCs, how does the Fico bump happen? Is it a one time bump or is it a progressive bump as you make on time payments on all 3 CCs?

 

Unfortunately Discover secured is out of the question as the prequal said previous CO with Discover so I was denied for that. I'm afraid to app for any other big bank secured card. Would it be worthwhile to get for example the Sky Card and 1 additional pred card like Credit One? I understand these predators are not cheap with the fees and all that, but I'd be willing to pay the fees if the tradeoff by having 3 CCs is worth it. Hopefully after a year of on time payments my score can improve so I can close the predators and get new cards. I say this because the Credit One fee for the first year is paid upon activating, which is about the same setup for all predators, so you might as well keep it open at least 1 year. Also, I have a long average age of accounts so I don't think I'll see a dip once I close the predators.


The amount of the bump for the 2nd and 3rd cards is not a set in stone figure, we just know that it happens for each of the first 3 cards opened in the Fico 8 model. Honestly I would see about a CU either local or one of the nationals for help on your 2nd and 3rd cards. You could go with OpenSky Secured as there is no credit check for it then get the CU card for the third.

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Message 20 of 20
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