The AZEO Method - Secured Credit Cards

[dirknights]

Thanks for the info. Discover I also heard was great, however, when I applied I was rejected. I tried to open a secured card for 2500.  

The reason the gave was because of the number of inquiries that I have on my reports.  Back in November 2018 when I was looking to purchase a vehicle, I went to a dealership and since my scores were in the mid 500s, they decided to run my credit across around 13 different banks to try to get an approval, with each bank doing a hard pull.  Unfortunately, I wasn't told about this upfront.

Right now my scores are  617E, 589T, 607Ex.  I am expecting those scores to start going up in the next few months. I negotiated with my final creditor on a settlement last week, making it eight out of eight. So all the collections and chargeoffs should be off my report this year.  I just need to have a revolving credit account on my report, to see some major "gains".

Also, after getting rejected by Discover, I applied for Fingerhut. They approved me for their entry-level/starter program.  Unfortunately, almost everything on that site is at least 50% more than it should be, at least when compared to Amazon.  

My original goal was to hit between 720-750 on all the reports by December of this year.  I will probably need at least 3 months of payment history on a few credit cards to get there though. But at the same time, if I wait until November, I can probably get some unsecured credit cards by that point, but that would mean that I would most likely miss my goal.  The ideal case right now, as I don't want anymore inquiries that could turn out to be a denial, like Discover, would be to keep on charging a bunch of items to FingerHut and pay it off on time. If they can at least give me 1000 - 2000 in credit, that might be sufficient enough to get me above 700 and then I can work on AZEO starting next year?

[designated_knitter]

With your scores -- have you tried the Cap 1 prequal site?  You might be surprised that you qualify for an unsecured card since 2 of your scores are 600+

My advice would be to hit all the prequal sites and you'll find out what you qualify for without taking the hard inquiry.  

FWIW -- I was shut out of Discover's secured until some miracle occured earlier this spring and my scores were worse than yours... just keep hitting their prequal site and don't apply for anything unless you pass a prequal site.

If you don't want the inquiry -- you can go with Open Sky.  They don't graduate but if you are just looking to add positive tradelines in the short-run, they might be a good option for you.

Also, those inquiries from car shopping should not be impacting your credit score... I know it is annoying to see dealers "shotgun" your credit to rack up the inquiries... however, for Fico scoring purposes when you are shopping for cars and mortgages, all inquiries you incur within (I *think*) a 2 week period are scored as a single inquiry.  I'm guessing that the collections may have been what really spooked Discover.  Wait 6 months and again, hit their prequalify site and see what you see.

Hope this makes sense... others more knowledgeable than I will be able to speak with more authority.

Best of luck!

Edited to add:  One more thing -- those inquiries are not even included in FICO's scoring algorithms after 1 year even though they will be visible on your CR for 2 years.

You can prequalify for Cap1, Citi, Discover, BoA etc by going to each of their websites... check out this website:

https://www.doctorofcredit.com/view-personalized-credit-card-offers/

for list of CCs that will pre-qualify.

[dirknights]

Thanks for the info. I went to the site you mentioned, and I was able to prequalify for a Capital One card. I will wait until September to apply, as I believe 2 of the 8 collections should fall off by that time. Hopefully, I will have all 3 in the 600s. Thanks again!

[sjt]

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@dirknights wrote:

Thank you. 

Until I received your response in regards to the Capital One Card, and graduating, I was looking: Capital One, Discover, Citi, U.S. Bank Secured, DCU Platinum, Armed Forces Bank Secured. Discover seems to be the no-brainer in the group.

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Capital One does NOT graduate. I would choose Discover and Citi. US Bank can graduate after a year, but when they do unsecure the card they close the secured card and open a unsecured card as a new account.

[calyx]

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@sjt wrote:

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@dirknights wrote:

Thank you. 

Until I received your response in regards to the Capital One Card, and graduating, I was looking: Capital One, Discover, Citi, U.S. Bank Secured, DCU Platinum, Armed Forces Bank Secured. Discover seems to be the no-brainer in the group.

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Capital One does NOT graduate. I would choose Discover and Citi. US Bank can graduate after a year, but when they do unsecure the card they close the secured card and open a unsecured card as a new account.

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Your info re: USBank is incorrect.   they do not open a new account.  They send you a new (unsecure/plat) with a new number, but the account information (opening, history, etc) stay the same.