When should I upgrade a secured card to unsecured?

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When should I upgrade a secured card to unsecured?

Postby shoptalk01 » Fri Oct 26, 2012 3:23 pm

I have a question on the following cards. Capital One Secured, US Bank Secured and possibly a future card Bank of America Secured.

With Capital One, I've only had the card for a few months but today received and invitation in the mail to apply for an unsecured platinum card. I figured it was too soon but I just made several on time payments so I went to the website and was instantly denied. I heard they don't unsecure the card but rather have you apply for a better card. How would I then know when it's time to apply for a better card? As I was looking over the internet and doing a search, some of the information I received was that you must cancel your secured card first or you will always be denied for a better card, is that true?

What about the US Bank secured card, will they notify me that it's time to unsecure the card, do they just do it or do I need to contact them and request it?

I've been strongly thinking about getting a Bank of America secured card in 6 months or so and cancelling Capital One as I'm really unhappy with them. I have a Sam's Club membership so I'd be happy if I could qualify for their store card. It makes it difficult when your debit card only let's you spend $200 per day, I filled with gas before going in the store, must have spent something someplace else and at the checkout my card was declined. I took someones advice, left my Capital One MasterCard at home and now had no way to pay at the checkout so had to leave a cart full of stuff set and walk out. My bank keeps telling me I need to call and request a higher spend limit, but they only put the limit up for about an hour and if you don't check out in that time, they put it back down again.

I've been trying to set up an account with Ally Bank for a much better debit card, but now I have to call back for the 3rd time because they can't verify my information. Went to WalMart and was able to get a BlueBird card, started with $100 and we'll see how it goes.

How long should I wait before attempting to get a Bank of America secured card and dumping Capital One?

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Postby DavidNY » Fri Oct 26, 2012 9:21 pm

With BofA it's automatic.

It sounds like you need to find a new bank.

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Postby circle_k » Sat Oct 27, 2012 2:43 am

The days of keeping your money at home in a small town bank are long gone. Today there is no such thing as loyalty and you shouldn't feel any such thing, I know people who keep switching banks because the good deals are offered to new customers while they often forget about the loyal customer who's been there for 40 years. You might also want to consider a 2nd account. One school of thought is never to carry a debit card tied to the main account you use for paying your bills and savings, that way if something happens, you still have an account to pay the month's bills. Amex BlueBird/Prepaid is okay in that there are no monthly fees, but there have been reports of the cards not working for ordering online and there are pleanty of places that don't take Amex so I have a hard time recommending them. I did hear a rumor about Amex offering you an Amex green after a time of using the prepaid card, but it's unclear how much you would have to keep on the card and use the card to gain their favor. If you use it for less than $100 per month, I would have to say never.

You mention you are a Sam's Club member, Sam's Club is a weird animal, they accept MC but not Visa. The reason is because they said what they were willing to pay for merchant fees, MC accepted their offer but Visa didn't. They are required to accept Discover because they now issue their own Discover card. You can't use an Amex card there, but you can use a debit Visa with a PIN. This might be a case where it would be okay to just use the Capital One MC that you already have. Whatever you do, don't apply for any store cards without asking around and doing pleanty of research. It's been found most store cards just don't have the pizzazz they once did, my parents used to have Sears, JCPenny, Montgomery Ward and several others I can't think of but only because these places didn't take take major bank cards back in the 70's, but that's changed. I find it interesting people line up to apply for Sam's club credit when their biggest pull is your membership card is your credit card, use only one card at checkout instead of 2. Most non reward major bank cards still are a better deal.

I think I said it before, there are NO good starter cards for building/rebuilding credit. US Bank, Cap1 and BofA are some of the better cards. I don't think Cap1 will ever tell you it's time to upgrade, they'll let you have a secured card forever. If you can try to keep an eye on your credit score and when it's well over 600, you might go to the Cap1 website and see if you can get pre-approved for another card, this is a soft pull. After a year or so with the secured card, give them a call and see if you can get the Platinum card with a $750 limit. If you can, go for it, cancel your secured card and get your money back. The big thing is they keep making you apply for better cards causing most people to give up on them. US Bank as I understand will let you upgrade the card you currently have to unsecured in as little as a year. I'd try to add as much to the funds as I could as they will start you out with the limit you currently have, but they will give you increases.

At this point, another card or switching cards will do nothing to help your credit, you should not be looking to upgrade cards for at least 6 months, but I would wait at least a year. You want to save the inquiries for when you qualify for credit. 3 inquiries along with 3 new lines of credit don't look as bad as 12 inquiries and no new lines of credit. Just don't apply for more credit, take care of the accounts you have and things will get better.

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