Here's a topic that has, to my knowledge, been brought up as an aside in several different related threads, but I do not believe it has ever been discussed in its own topic. While perhaps the information found here is basic to seasoned FWF'ers, many new members (if recent experience is any indication) may find a lot of basic answers here.
This was actually a good article. One of the few that actually have sound advice. Although most of regulars arounds here know this stuff, I quoted some of stuff that many of us repeat over and over (but no one listens!).
I am not sure about -20 for opening a store card though.
Steve Rhode, president of Myvesta, a nonprofit consumer-education organization, agrees, saying that each time you open a store credit card, 20 points are taken off of your credit score because, he says, "Historically, store credit cards are issued to anyone with a pulse. They issue credit cards to people who otherwise can't get credit."
Another rule of thumb to remember is to keep your debt ratio under 50%. If your credit card has a $5,000 limit, don't carry a balance of more than $2,500.
"Keep credit purchases under 50% of the credit limit. (If you have a) $5,000 limit -- and you want to buy a $4,000 furniture set -- split the purchase onto two cards," says Williams. She says that creditors don't like to see a card almost maxed out; they look at you as a risk, someone who is using too much credit and has trouble paying off debt. .
Make your payments on time. One late fee or even two can really bring down your credit score and increase the rates on your other credit cards. You are the only person responsible for payment.
Do not run up your credit. Ideally, you should keep your balance low -- less than 30% of your credit limit on each card. Some debt advisers also warn not to close too many cards at once. It will cause your debt-to-credit ratio to fall. For example, if you have $10,000 of potential credit and a $5,000 balance, you are using 50% of your potential. If you shut down a card with a $2,500 balance quickly thereafter, you will have $5,000 of debt and only $7,500 of potential, upping your ratio to 67%.
I keep hearing this all the time, that to start building your credit you should open up a store account. But when I was starting, I tried to open a Sears account, and would not get one, due to the lack of previous credit.
Maybe it's Sears, and I should've tried someone else, but isn't a secured credit card better in that you'll be more likely to get approved?
BigBucksNoWhammy said:Here's a topic that has, to my knowledge, been brought up as an aside in several different related threads, but I do not believe it has ever been discussed in its own topic. check the CC faq in the sticky, there have been prior threads on this topic
BigBucksNoWhammy said:Here's a topic that has, to my knowledge, been brought up as an aside in several different related threads, but I do not believe it has ever been discussed in its own topic. While perhaps the information found here is basic to seasoned FWF'ers, many new members (if recent experience is any indication) may find a lot of basic answers here.
Does the Dell Preferred Account count as a store card? I've had this account open for awhile now to get a discount and am no longer using it. Don't want it to be dropping my score by being open.
try Dicsover Card for start. It has more liberal credit requirments. I opened it when was in the country for only 2 month. Then u gona get 10 new offers a week...
mikkopel said:I keep hearing this all the time, that to start building your credit you should open up a store account. But when I was starting, I tried to open a Sears account, and would not get one, due to the lack of previous credit.
Maybe it's Sears, and I should've tried someone else, but isn't a secured credit card better in that you'll be more likely to get approved?
I've heard that Sears is one of the harder store cards to get. Try JC Penney, or Macy's.
didYOUsearch said:check the CC faq in the sticky, there have been prior threads on this topic
Of course, you could argue that there are not many general use topics left that haven't been brought up at some point in this forum. Finding them quickly and easily, however, is another thing altogether, especially for those new to the forum. On the flip side, I would argue that a perusal of the sticky does not readily show much on this particular subject other than What is the optimal number of credit cards to have open at a time? (in relation to credit rating) and that brief thread is more chit chat and show and tell than anything nearly as informative, comprehensive and authoritative as the article shared in the OP here.
The purpose of posting was that these types of questions seem to be asked with increased frequency of late by new members who haven't read the sticky. Count the number of times you yourself has had to police and chastise those who were unaware or unwilling to read the FAQs. No offense, but sometimes I get the sense (as I bet you do too) that you are a broken record no one is listening to. Rather than face the demand to repeat this info, as reckner77 has pointed out earlier, it seemed appropriate to just send those interested straight to this very useful and well written article where they can get the information they seek quickly and painlessly.
Beyond this, I'm not certain that having monstrously long threads in some cases (many times 3/4th or more of which are useless and annoying clutter posts) is a good thing, and that forum-goers are rather better served if thread topics are renewed and refreshed every couple of years. Times do change as do many policies of banks, credit card issuers, and other financial institutions over the years. After all, who wants to wade through dozens or more pages of outdated, misinformed, irrelevant, or otherwise useless posts (for example, the several pages of posts about receiving a hat in the ED thread) in the hopes of gleaning scattered tidbits of actually useful information? Most readers, I'd wager, don't have that kind of time, even if they have the inclination.
It is no wonder to my mind why some rather risk suffering your wrath to get an answer by posting their question. I think it would be wise to consider overhauling the FAQs thread to condense those current FAQs threads into concise, comprehehsive single informative posts that would much better perform as "quick and ready references" to this forum's most frequently asked questions. There is a possible reason they are the most frequently asked: because the threads in the current FAQs are too cluttered and need to be edited for content, shortened, or otherwise revised to become the convenient and effective references they're supposed to be. Perhaps in addition to "didYOUsearch" police we should have a "you'reOFFtopic" police? After all, look how easy it is for threads to get off topic, present company not excluded?
Well would you look at that, this really turned into a somewhat of a rant there at the end. I blame the heartburn and indigestion that kept me tossing and turning most of last night.
edit: the last time the CC FAQ was updated was May 2, 2004.
Two members brought this up in that thread.
Date Posted: Apr/30/2005 10:56 PM
Get busy. This thread should be current.
Thanks
Walpoc
And
Date Posted: Apr/30/2005 2:17 PM
The best reward thread is a little out of date, I would open a new one with all the new credit cards with rewards that are out there but don't want the repost police to come a knocking.
This article is a bit more on target than the usual anti credit card rants. Though the same old:
"Credit agencies warn that the more cards you have, the bigger risk you carry for racking up debt and damaging your credit"
still is the same frame of mind that most people needing saving from themselves. I bet that people with fewer cards-generally because they can't get more or because they don't trust themselves with more- are more likely to go into debt.
This article is a bit more on target than the usual anti credit card rants. Though the same old:
"Credit agencies warn that the more cards you have, the bigger risk you carry for racking up debt and damaging your credit"
still is the same frame of mind that most people needing saving from themselves.
I bet that people with fewer cards-generally because they can't get more or because they don't trust themselves with more- are more likely to go into debt.
As far as scores go, it's always YMMV.
NOT TRUE.I do not see why i need more than 4 credit cards for personal use. I could get more, but i do not need them. And the credit score has nothing to do with it, just keep your balance below 25% (of your total credit on all cards) and you will be fine!
The problem is that there are to many irresponsible people in this country. from the average "Joe" with 10 maxed out credit cards to the "smart guy" in white house with the LARGEST DEBT in the world!
papkov said: NOT TRUE.I do not see why i need more than 4 credit cards for personal use. I could get more, but i do not need them. And the credit score has nothing to do with it, just keep your balance below 25% and you will be fine!
If you think you don't need any more cards, then that works for YOU. However other people may need more than 10. It is correct that some people cannot handle more than 1 card.
But to imply that keeping only a couple cards will keep them from going on a spending beyond their means frenzy is ridiculous.
The store credit cards give me the most headaches. My family members often go shopping and open new store credit card accounts (to get discounts) without my knowledge. Then I receive bills out of the blue and often forget to pay them (not in my billpay system).
Who said one card? You do not need more than ~4 cards. The average 4x 5000-10000 line on each card should be more than enough! Unless you have a low credit line .. or love to have have a debt on your shoulders. If you have several credit cards from the same bank, leave only one card, close the rest of the accounts and combine the credit lines. This way you can "make your credit report look better".
SoBeyondTheNorm said:papkov said: NOT TRUE.I do not see why i need more than 4 credit cards for personal use. I could get more, but i do not need them. And the credit score has nothing to do with it, just keep your balance below 25% and you will be fine!
If you think you don't need any more cards, then that works for YOU. However other people may need more than 10. It is correct that some people cannot handle more than 1 card.
But to imply that keeping only a couple cards will keep them from going on a spending beyond their means frenzy is ridiculous.
this is a pure irresponsibility.
76hhma said:The store credit cards give me the most headaches. My family members often go shopping and open new store credit card accounts (to get discounts) without my knowledge. Then I receive bills out of the blue and often forget to pay them (not in my billpay system).
truspark said:Is there anywhere I can find out just how many open and active credit cards I have? My credit report doesn't seem to list them all. Can they reappear?
If they don't exist on any of the big three reporting bureaus, then they don't exist (at least as far as anyone inquiring into your credit history is concerned).
What makes you think you have credit cards that aren't reported?
Keep in mind that closed accounts drop off the radar so to speak after several years.
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