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New to building credit, some things I was wondering about

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Anonymous
Not applicable

New to building credit, some things I was wondering about

New to credit, parents don't really have CC's either, just debt, so they aren't very useful on this topic. 

I was wondering a few things, namely, when trying to build credit, is it best to use your CC's as much as you can (financially and physically) and then pay off most of what you spent, leaving a bit left over, say 10-15% util?  IE, I have a limit of 500 on cap1, and I use 500+ and pay it off as I go, leaving it at around 50-75 dollars.

Also, how often should I ask for CL increases? I have a cap1 and a creditone and both are 500. My credit history is around 16 or 17 months old iirc.

On the topic of Creditone, once I have my credit built up more, should I cancel the card after paying it off? To be honest, creditone seems kinda worthless long term. (currently at 700~ according to creditkarma and around 730-740 according to wells fargo's fico)

Message 1 of 8
7 REPLIES 7
HeavenOhio
Senior Contributor

Re: New to building credit, some things I was wondering about

Welcome, @Anonymous. Smiley Happy

 

How old are each of your cards? If your newest card is at least six months old, I'd apply for a new card and close Credit One. Don't bother asking for a CLI (credit limit increase) on that card. Discover smells like a good option for your next card.

 

"Responsible" usage is 28.9% utilization or below. To fully optimize one's score (which usually isn't necessary), you'd implement AZEO (all zero except one). You'd leave a small balance (at least $5 but not much more) on one card with the others reporting zero.

 

In your case, I'd pay your Capital One card down to $5 at statement time and not worry if new charges post and bring your final balance up to about $140. If you're occasionally over 28.9%, that's OK. Banks will tolerate that as long as they get their money, and Captial One minds higher utilization less than most.

 

If you haven't requested a CLI on your Capital One card, go ahead and do so. Be forewarned that Capital One starter cards frequently grow very little. Understanding that eliminates frustration if your limit ends up being capped. But you don't know unless you try. Some Capital One starter cards do manage to grow.

Message 2 of 8
SouthJamaica
Mega Contributor

Re: New to building credit, some things I was wondering about


@Anonymous wrote:

New to credit, parents don't really have CC's either, just debt, so they aren't very useful on this topic. 

I was wondering a few things, namely, when trying to build credit, is it best to use your CC's as much as you can (financially and physically) and then pay off most of what you spent, leaving a bit left over, say 10-15% util?  IE, I have a limit of 500 on cap1, and I use 500+ and pay it off as I go, leaving it at around 50-75 dollars.

 

It doesn't matter how much you use the cards. Just be sure the balances are low when the statement cuts, and that you pay the balance off shortly after the statement cuts.

Also, how often should I ask for CL increases? I have a cap1 and a creditone and both are 500. My credit history is around 16 or 17 months old iirc.

 

It doesn't matter if they're soft pulls. Capital One are soft pulls. I don't know about Credit One.

On the topic of Creditone, once I have my credit built up more, should I cancel the card after paying it off? To be honest, creditone seems kinda worthless long term. (currently at 700~ according to creditkarma and around 730-740 according to wells fargo's fico)

 

Yes if it has an annual fee. If not wait until you can replace it with a better card.


Don't pay attention to the Credit Karma scores. They're meaningless.


Total revolving limits 569520 (505320 reporting) FICO 8: EQ 699 TU 696 EX 682




Message 3 of 8
Anonymous
Not applicable

Re: New to building credit, some things I was wondering about

Both of my cards were gotten at the same time, so they're both almost 2 years old. As for my Capital one, I recently just upgraded it from Journey to Quicksilver, because I figured the starter card would be slow growing in terms of limit.

As for my next card, yeah I was thinking either Discover or Wells fargo's Propel. Honestly my goal right now is just to grow my credit, I haven't gotten scores from myfico yet but I imagine that it SHOULD be around 670-725, so I want to raise that up.

 

@SouthJamaica On the topic of creditone, I don't even think I can ask for one, they just automatically upgrade me, and now they don't even do that, they just send me "offers" to pay 24.99 and get a 300 dollar limit increase...at least once a week. Yeah I figured creditkarma was pretty useless but it's one of the only scores I can see other than my  fico scores that show up in wells fargo and I guess the chase one as well?

Message 4 of 8
Anonymous
Not applicable

Re: New to building credit, some things I was wondering about


@Anonymous wrote:
Yeah I figured creditkarma was pretty useless 

Credit Karma is very useful in a number of ways.  It's just the scores that are useless.

Message 5 of 8
Anonymous
Not applicable

Re: New to building credit, some things I was wondering about


@Anonymous wrote:

Honestly my goal right now is just to grow my credit, I haven't gotten scores from myfico yet but I imagine that it SHOULD be around 670-725, so I want to raise that up.

 


You can get your FICO 8 scores for $1 from Credit Check Total.  Personally I'd suggest that approach before forking out money for the far more expensive myFICO credit monitoring products.

 

There also free tools out there that will give you FICO 8 scores.

Message 6 of 8
Anonymous
Not applicable

Re: New to building credit, some things I was wondering about

Oh? What is it useful for?  I only really use it for the score and using it as a reference to see if a card is likely to accept me.

Message 7 of 8
HeavenOhio
Senior Contributor

Re: New to building credit, some things I was wondering about

Don't rely on their card recommendations either. Their main objective is to collect money from getting people to apply. Use this forum for card recommendations. Smiley Happy

 

Use Karma for their excellent TransUnion and Equifax reports. Their alerts are also excellent.

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