My Journey to better credit

[Fairymoondust84]

Hi all my name is Erica, I want to start out first by saying that I read all of your posts about the Capital One Secured Card before I even applied. So glad I found this forum. Well here is my story so far, I am 29 years old and I have never had a credit card. I do have some rough patches on my credit history, especially medical bills. So I figured I need to do something about my credit history. The only way I can build up my credit is to get a secured credit card. So I actually applied for 2. One was with my bank Wells Fargo, they wanted a $300 deposit. And the other was for Capital One, they wanted $200 deposit. My plan was to make a deposit and just forget about the money. Basically pretending that they gave me that credit line. So I went with Capital One Secured Credit Card. $200 is a lot easier to forget about then $300. 

I have read a lot of reviews on the Capital One Secured Credit Card. A lot of success stories. This is all the info that I found through this forum and many many reviews about this card.

Most of this below is for anyone new to the whole secured credit card world and my timeline,

Now with the Capital One secured card there is 3 different deposit amounts, $49, $99 & $200. They base your deposit on your credit history. Since I have no credit history I had to put $200 down for my deposit. Which is my credit limit. I have read that a lot of people only had to put down $49 or $99 and their credit limit was $200. So since their deposit was $49(for example) they gained $151 from credit limit which equaled to $200. I also read that you will get a credit limit increase of $100 if you keep up with making on time payments. Now in my case since I had to put the full $200 down, I will not qualify for the credit increase. Also this card will not Automatically graduate into a unsecured credit card. You have just apply for a unsecured credit card to see if you are able to get one. You can close the secured credit card if you wanted to and get your deposit back, which I read that closing an account can hurt your credit score.

I have been signing up for free credit scores to see what my scores where like. 

Now these scores are from Experian and I believe some are FAKO scores not FICO(which is what most credit lenders go by) but with these scores I can get an idea of what my scores may be close to. I also found out that FICO scores are only generated when you have at least 6 months of credit history.

According to Creditsesame.com my Experian credit score is 588.

According to Quizzle.com my Experian credit score is 566

According to CreditInform.com(credit monitoring tool from Capital One which are FAKO scores, won’t have a real FICO score until you have 6 months of credit history) my Experian credit score is 573

So my Experian score can be anywhere from 550-590, maybe!!

Also according to all these free credit websites that I used including annualcreditreport.com I have 11 negative collections on my Experian.

I tried looking on creditkarma.com(they provide TransUnion FAKO score)but they said I have a “thin file”

I only been keeping track on my Experian for right now. I did however sign up through my Wells Fargo bank for all 3 credit reports & scores for $1 for the first 30 days. Just waiting for all that to come in.

 So here is my credit timeline so far: 

3/3 Applied for secured credit card. Instantly Approved. Needed to make a $200 deposit for $200 credit line

3/9 Deposited $200 

3/22 Called Capital One to find out when I will get my card. They said should be here by the 23rd or by the 30th

3/24 Got an email that my card was shipped out on the 23rd should get it in 7 business days

3/27 Got an email from Capital One telling me to enroll. How can I enroll when I haven’t gotten my card yet? So I assume I will get my card very soon

3/28 FINALLY got my card. Activated it online. I really like their layout. Starting available credit $200 which is what I deposited.

3/28 Was billed for the annual fee $29(boy they are fast)

3/28 Made my first purchase online on drugstore.com for $23.57

4/2 Made another purchase at the dollar store for $7.99 Making my balance $60.56(that includes the annual fee of $29) a tiny bit over the 30% spending limit.

4/9 Signed up for the free CreditInform(free tool offered by Capital One to monitor my credit). I find it a bit useless

4/9 Filed a dispute on 4 medical collections on my Experian credit report

4/10 Got an email from Creditsesame.com and my score from Experian went up from 588 to 605(even though its a FAKO score, it still good to see the score go up)

4/15 Got a letter from Experian about the 4 credit report disputes that I filed on the 9th. 3 was deleted totaling $695, the 4th one was updated saying I still owed even though I had health insurance at the time

4/17 Talked to Capitol One through chat, I was told that my statement will generate before midnight tonight and my due date will be the 14th of every month. I was told that I can make my payment anytime, so I am going to make my payment today. I was also told some helpful info that I should make my payments during business days before 5pm EST.

4/17 Made a payment for $60.56 at 9:40am with my Wells Fargo checking account.

4/17 Payment Due Date posted, due date is May 14th, made payment today, balance is at $0 available credit still at $139.44

4/18 Available credit back to $200. So I made a payment at 9:40am on 4/17, payment was posted around midnight and then available credit went backup to $200 between 1:30-2am. Payment of $60.56 was taken out of my Wells Fargo checking account to my Secured Capital One Credit Card. So I officially made my very first credit card payment and all within 24hrs. Going to continue to use only 30% of my credit limit, which is about $60, every month. Hopefully in the next few months of doing this I will see my credit scores go up. 🙂

[fontanaman]

Hello Erica,

Welcome to the forums. I can tell by reading your post that you have taken the time to inform yourself about how to establish credit and I congratulate you for that.

Getting the secured cards was the first step. The next step is trying to get rid of those collections on your reports. I see you are already doing that, so keep up the good work. You want to try to remove all of them if possible. Do you know old your collections are? Remember that negative accounts fall off your reports after 7 years, so if you have collections this old, they might be falling off soon.

The last step is just paying on time, not maxing out your cards and having a lot of patience. Specially if you have collections on your reports, you need to have a lot of patience with those. It has taken me more than two years to get my scores high enough to finally get good cards. My scores have gone from around 580 to 711 during that time, but I feel having collections and lates on my reports have made things a lot harder for me.

The Capital One card is a great card for establishing credit or for rebuilding. I’m sure you also qualify for the $100 credit line increase by Capital One, the only things is that for some reason they don’t give that increase to everyone. I was given a $100 increase at around the 6 month mark, but I’ve heard a lot of people complaining about not getting one ever. So it seems like they give that increase randomly so don’t be discouraged if you don’t get it.

I’ve had the card for more than two years now and I haven’t received any more increases. I’m closing my account this month, I think it has served its purpose and I want my deposit back. This card never graduates, and I think it’s a shame that it doesn’t. Still, all positive information will remain on your files for 10 years or more, so it’s all good.

Will the Wells Fargo card unsecure at some point?

[Fairymoondust84]

Hi Fontanaman and thank you 🙂 

Are people not getting a increase because they had to make the full deposit of $200? I read a lot of reviews and noticed that if they had to make the full $200 deposit they never got an increase. I had to make the full $200 deposit. I don’t have a wells fargo secured card, just a checking account with them. I was thinking about maybe adding their card down the road, but not sure if I want 2 secured cards. Right now I just sell my handmade jewelry so that is the only job I have right now. Some weeks are really good, others not so good when it comes to money. My plan is to only use 30% of my limit, no matter what and always paying in full on time. I actually have to check and see how old these negatives are. I had 11 on my experian but got 3 deleted and 1 of them updated. So now I have 8 negatives. 6 of them is medical bills. 1 is from bank of america $800 & something. In 2008 I withdrawn a total of $100 and from all of the overdraft fees it climbed to  over $800. and then the other is from a dvd club for $30. Which is really nothing. I am going to pay that very soon. Do you know if I contacted them if they would lower any of those? Also I am very new to the credit world. Now I seen my scores and reports from Experian, now if I had 11 negatives on them would I have negatives on the other 2 credit bureaus?

[fontanaman]

I don’t think the increase is related to the deposit you were approved for as Capital One states that you may earn credit line increases based on your payment and credit history. My Capital One did get a lot of usage at the beginning as this was my only card back then, and I always paid on time. I think doing these things helped me get an increase, but who knows, I’ve heard other people doing the same and not getting one…

You should try to get a 2nd credit card. You already know that Capital One does not graduate, so you might as well get a second card that will grow with you and when you are ready to close Capital One, you’ll have a 2nd card you can keep with some history as well. If you get a 2nd secured card, get one that will graduate like the ones offered by BOA and Citi (though these are not as easy to get). I’ve heard mixed things about Wells Fargo secured cards, some get unsecured, some don’t. You might be able to get an unsecured CapOne card a few months down the road…a store card might help build some history, and they’re usually easier to get. Having so many collections and a low credit score might make it difficult for you to get approved right now, so you can wait a few months.

Some collection agencies report to the 3 bureaus, some report to 1, some to 2, so you will not necessarily have the same amount of collections on the 3 reports.

In regards to your medical collections, I would try to contact the original debtor first and try to negotiate with them. If the accounts are old, they most likely will not have the records any more. Does the Bank of America collection appear as a charged-off? If so, you will have to deal with a collection agency. It’s already 5 years old, so you could just wait for it to fall off your reports.

Most importantly try to negotiate “Pay for Deletes”, meaning that rather than updating your collection to “Paid”, you will pay them in exchange to have the tradeline deleted from your reports. A Paid collection will not improve your credit score, it will look better if a lender actually pulls your report and sees that you have paid them, but in terms of scoring, a paid collection is the same as a non paid one.

Start by paying the collections with lower amounts first, for better results, offer the full amount in exchange for having the accounts deleted. For higher amounts, you can try to negotiate a lower payment. Google “Pay for Delete” and you’ll find a lot of info on this.

[Fairymoondust84]

Thought I would pop in here to update on how my credit journey has been going. Since having my card for almost 7 months I have to say, getting this card has been the best decision I have ever made in my life. For the first few months I was doing it all wrong. I would pay my balance off in full every month without carrying a balance, well after searching on the right way of doing it, I started only carrying up to $50 of my $200 credit limit as a balance, then I started using all of my credit limit. Still making on time minimum monthly payments. Last month me and my mom went to buy a car. I had $3,000 cash, I wanted to get a $4,000 used car so I will only have $1,000 and fees until it is paid off. Well the place was closed where I saw a car I wanted, so we went across the street to another car lot. They only had one car that was around my price, but my mom insisted on getting a newer car. The car I picked out was $15,000. EEEkkkkkk I will be paying for this car forever. Well they ran my moms credit and she was denied for the loan. They ran mine and I was approved for a $15,000 car loan. And it is all thanks to this card. Before this card I had no credit. This is the only credit card type I have besides having a bank account. Well 3 weeks after getting the car loan, I got a $100 unsecured credit increase from Capital One. I was in total shock. 2 weeks after that, I applied to Credit One Bank for a credit card and was approved for $300 unsecured credit card. I applied to this card before and was denied, even after credit karma kept telling me I would be approved, well I finally was. And it is all thanks to Capital One’s Secured visa 🙂

[fontanaman]

Hi Erica, welcome back to the forums.

Congratulations on your new car and credit card! I know it feels good when you finally start getting approved for things you need, like a car. Believe it or not, that car loan is going to help your credit a lot. Pay on time, give it 6-12 months, and you’ll start seeing a credit score boost. If you don’t mind me asking, which bank approved you and what is your APR? I might be able to give you a couple of tips if your APR is on the higher side.

The Capital One card helped me a lot as well. It was great for re-establishing my credit. Just like you I was able to purchase a car about a year and a half ago through Ally Bank. Two months ago Chase refinanced my car loan and offered me a much better deal.

[jerm17]

I’m glad I found this myself I just got one of these my self…..my score is like 540 I was wondering how much my score will go up…..I have a couple of medical bills….I also pay on a car myself I kinda did in backwards…..do you know if this card will get me in the high 600 if I pay on time ?

[fontanaman]

Hey there jerm17, welcome to the forums.

When you open a new account, your score might take a hit for a while, and then it will improve after paying on time for some months and your account ages. Opening an account may also improve your score from the start if you don’t have a lot of credit available. Both have happened to me in the past. It’s hard to say as every case is different. However, your score will improve if you pay on time and if you take care of the negative items on your credit report. That’s for sure. Be patient as it might take longer than you expect. I would take care of those medical bills, you’ll be surprised how much your score will improve if you get rid of all your collections.

[Fairymoondust84]

Hi, I haven’t updated in a long time. So here is an update on how My Journey To Better Credit. I started in March 3rd, 2013 with the Capital One Secured Card. Best card to ever get if you want to fix your credit. Anyways, I had 11 bad marks on my credit, I am down to 4 now. Here is a list of the credit cards I have been able to get since rebuilding my credit:

Capital One Secured Visa: Started at $200 deposit, never increased my limit with depositing more. Since having the card they have raised my limit to $750. That is a $550 unsecured limit increase from them.

Credit One: I was approved for this card in October. $300 credit limit. Now it’s up to $1,000

Victoria Secret: I was approved in April 2014 for $300, now its up to $750

Wells Fargo Secured: $500 deposit, got my graduation letter in March saying it is graduating to a unsecured credit card this month and I will get my deposit back in May

Old Navy: $300

JcPenney: $500

Amazon Store Card: $800

Kay Jewelers: $2000 when I applied now its up to $4,000

GameStop: $350

Capital One Platinum: I was approved for $300, now its up to $3,000

Capital One Quicksilver: I was approved for $300, now its up to $500

Paypal Credit: $2,550 now this card doesn’t report, which kinda sucks. But its really good because I max the card out without it affecting my score.

Plus I have a car loan from Ford Credit.

For the most part, I try to stay under 30% on each card. But I have used my cards and payed the minimum amount every month before my due date. Carrying a balance has helped out a lot.

According to credit karma my Transunion is 660 and my Equifax is 648. When I first started I couldn’t get into credit karma because I had a thin file. So I wanna say when I did that my scored was between 500-560.

Anyways, that is my update 🙂

[fontanaman]

Hi Fairymoondust84,

Wow, that’s quite an update. Capital One gave you a $550 unsecured increase! That’s unheard of. When I had that card, I only got a $100 increase and I remember a lot of people complained they never got one.

How did you get those collections off your reports? If you have any tips, I would love to hear them.

I didn’t know PayPal credit does not report to the credit bureaus. Interesting. I have a PayPal Smart Connect, and it does report.

Are those fako credit scores? If they are, you should consider getting your real scores. I found that for me, Fico and fako were very different. You might be surprised, your Fico scores could be higher than that.

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