Upping my credit score
#61
BE Enthusiast
Joined: Aug 2012
Posts: 302
Re: Upping my credit score
Why wouldn't you just get a secured credit card at the bank you are already banking with? I got a $500 secured card, paid my cell phone bill with it every month and cleared the balance every month. About 6 months' later they refunded the $500 and it's now a normal credit card.
#62
BE Enthusiast
Joined: Aug 2012
Posts: 302
Re: Upping my credit score
Also credit.com pulls from experian and is free.
I'll say this, with wells fargo you can get a pre-paid secured credit card upto $5000 i believe. Meaning you give them upto $5000 for security.
Now the biggest trick to increasing your score is two folder, get credit, but do not carry any balance of any kind. The lower your limit the more a credit balance can destroy your credit.
For instance if you get a $500 pre-paid secured credit card, you should never have a balance of more than $150 on it.
Reason being, you never want any credit instrument to carry more than 30%. More than that and it'll really start to hurt your credit; but any balance will actually hurt your balance.
So use the card each month but very important, pay it off each month BEFORE the due date, at least a week, so the credit card always reports a $0 balance.
If you follow this your credit will climb, your secured card will turn into an unsecured one within a year, and you'll likely within a very short time hit 700 plus prob within a yr to 2 yrs.
I'll say this, with wells fargo you can get a pre-paid secured credit card upto $5000 i believe. Meaning you give them upto $5000 for security.
Now the biggest trick to increasing your score is two folder, get credit, but do not carry any balance of any kind. The lower your limit the more a credit balance can destroy your credit.
For instance if you get a $500 pre-paid secured credit card, you should never have a balance of more than $150 on it.
Reason being, you never want any credit instrument to carry more than 30%. More than that and it'll really start to hurt your credit; but any balance will actually hurt your balance.
So use the card each month but very important, pay it off each month BEFORE the due date, at least a week, so the credit card always reports a $0 balance.
If you follow this your credit will climb, your secured card will turn into an unsecured one within a year, and you'll likely within a very short time hit 700 plus prob within a yr to 2 yrs.
I would carry a small balance on at least one card. The most important thing though is not being late. Don't carry a balance if you can't time the payment and make sure it shows up.
#64
BE Enthusiast
Joined: Aug 2012
Posts: 302
Re: Upping my credit score
I have no idea! It's what I read years ago when I started to pay attention to my credit.
Have a mix of credit installment and revolving at different institutions.
Take out secured loans at two different credit unions for varying lengths.
Keep a balance between 1% - 9% on one card.
Find a credit union or bank that offers a line of credit on their checking account and keep it open. This will be a long term open revolving account.
Target, Hooters, and HSN (GE Money Bank/GE Capital now) cards are good for those with no credit to apply for.
Have a mix of credit installment and revolving at different institutions.
Take out secured loans at two different credit unions for varying lengths.
Keep a balance between 1% - 9% on one card.
Find a credit union or bank that offers a line of credit on their checking account and keep it open. This will be a long term open revolving account.
Target, Hooters, and HSN (GE Money Bank/GE Capital now) cards are good for those with no credit to apply for.
Last edited by tuxedocat; Feb 26th 2016 at 2:19 pm.
#66
BE Forum Addict
Joined: Aug 2013
Location: Athens GA
Posts: 2,133
Re: Upping my credit score
My understanding is that the credit card companies report the balance outstanding each time a statement is produced. This is used to calculate your utilization %, which is an important element in your score; best to keep it under 10%.
What you pay is not directly relevant but:
- you must make a payment on time. Late payments hit your score
- if you roll too much forward it may increase your balance next month which, in turn, increases your utilization % for that month
What you pay is not directly relevant but:
- you must make a payment on time. Late payments hit your score
- if you roll too much forward it may increase your balance next month which, in turn, increases your utilization % for that month
#67
Re: Upping my credit score
I have no idea! It's what I read years ago when I started to pay attention to my credit.
Have a mix of credit installment and revolving at different institutions.
Take out secured loans at two different credit unions for varying lengths.
Keep a balance between 1% - 9% on one card.
Find a credit union or bank that offers a line of credit on their checking account and keep it open. This will be a long term open revolving account.
Target, Hooters, and HSN (GE Money Bank/GE Capital now) cards are good for those with no credit to apply for.
Have a mix of credit installment and revolving at different institutions.
Take out secured loans at two different credit unions for varying lengths.
Keep a balance between 1% - 9% on one card.
Find a credit union or bank that offers a line of credit on their checking account and keep it open. This will be a long term open revolving account.
Target, Hooters, and HSN (GE Money Bank/GE Capital now) cards are good for those with no credit to apply for.
When you fill in the application for credit whether it's cards or loans, as a non-working or p/t worker or as someone getting alimony... it is the HOUSEHOLD income that counts - anyone paying at least part of your bills. So, you can put down your husband's/wife's income if you are a stay at home parent. Useful so that you can start to build credit in your own name.
Don't do as I did, when filling out the target application and put big fat zero in the income part.......
#69
Just Joined
Joined: Jan 2016
Posts: 8
Re: Upping my credit score
Can you do a secured credit card in Canada? I know you can in the states, where you basically prepay money into it in order to build your credit.
#70
Forum Regular
Joined: Mar 2014
Posts: 147
Re: Upping my credit score
Why wouldn't you just get a secured credit card at the bank you are already banking with? I got a $500 secured card, paid my cell phone bill with it every month and cleared the balance every month. About 6 months' later they refunded the $500 and it's now a normal credit card.
In my case they refunded my 1000, left me with my credit card AND issued me with another card. The cynic in me says that gets them two annual card fees but the reality is also that I have a higher total limit and two cards (someone at Experian told me to keep both cards for now ... Until we have a mortgage sorted!)
Anyone planning a move to USA would do well to get a UK American Express card going. After one year, they will recognize your UK history in opening a US card with good credit limit
#71
Re: Upping my credit score
Now having more than 30% will drastically and negatively affect your score, close to the 100 points, possibly more the higher you go.
BUT
If you say paid that down, the very next month you'll regain those points so its not permanent.
The point being, if you want to use your credit for something, first pay off your cards, before applying as it can negatively affect the approval or the interest rate.
#72
Re: Upping my credit score
The trick to having good>great credit is to have a mix of credit lines in the order outlined below:
Credit cards
Mortgage
Store cards
Bank accounts
Personal Loans
Car Loans
Only having one kind, does not make much of a difference, and will temporarily decrease your score when you first get it.
Also as well have having that mix, the trick with credit cards/store cards etc.. is to NEVER EVER carry a balance, that means using and paying off within the statement period, so the CC company never reports an actual balance.
This will positively affect you in three very important ways.
1) You Debt/income ratio will be kept very low, this is very important
2) Your credit utilization will be kept to 0% this is your best scenario to build and keep good credit.
3) Because you are using BUT paying off your balance in FULL each month, your CC provider will increase your credit limit, usually every 6 months to a year. This is one of your best tools. Having the limit set higher means that point 2) becomes less of a factor.
Example, if you have a $5000 limit, on all CC cards and have spent $2500 you would be at 50% utilization.
If the limit on all your cards raised your overall CC limit to $10,000 then your credit utilization will now be $25% if your expenditure is at $2500. IF your limit raises further to say $20,000 across all cards, that $2500 becomes 12.5%.
Making your spent amount less of an issue. Obviously no balance carried as I outlined above is best practice, keeping your Credit utilization as low as possible is your best bet next to it.
*CC= Credit Card
Credit cards
Mortgage
Store cards
Bank accounts
Personal Loans
Car Loans
Only having one kind, does not make much of a difference, and will temporarily decrease your score when you first get it.
Also as well have having that mix, the trick with credit cards/store cards etc.. is to NEVER EVER carry a balance, that means using and paying off within the statement period, so the CC company never reports an actual balance.
This will positively affect you in three very important ways.
1) You Debt/income ratio will be kept very low, this is very important
2) Your credit utilization will be kept to 0% this is your best scenario to build and keep good credit.
3) Because you are using BUT paying off your balance in FULL each month, your CC provider will increase your credit limit, usually every 6 months to a year. This is one of your best tools. Having the limit set higher means that point 2) becomes less of a factor.
Example, if you have a $5000 limit, on all CC cards and have spent $2500 you would be at 50% utilization.
If the limit on all your cards raised your overall CC limit to $10,000 then your credit utilization will now be $25% if your expenditure is at $2500. IF your limit raises further to say $20,000 across all cards, that $2500 becomes 12.5%.
Making your spent amount less of an issue. Obviously no balance carried as I outlined above is best practice, keeping your Credit utilization as low as possible is your best bet next to it.
*CC= Credit Card
#73
Re: Upping my credit score
Does it make any difference if I close an account or if the bank closes my credit card account? I did wonder how long US bank would take to close 2 accounts that I never applied for, answer, about 7 years.
#74
Forum Regular
Joined: Mar 2014
Posts: 147
Re: Upping my credit score
I was advised not to close a credit card I don't "need" because that is like lowering your total credit line across all your accounts. Made sense to me so I just use the card for one tank of gas a month and pay it off.
#75
Re: Upping my credit score
If it is a card you have had for a long time, it can also affect the length of time you have had credit if you close it, and so negatively impact your credit score.