Store Cards vs Secured Cards When Rebuilding

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ForumPheen
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Store Cards vs Secured Cards When Rebuilding

Postby ForumPheen » Wed May 22, 2013 3:43 pm

Hello everyone, I have a question. When it comes to rebuilding credit, which type of card makes a better impact on your score and report, a retail store card, or a secured card?

Unsecured is best, but let's say one cannot obtain one. What would the next option be?


Robrus1
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Postby Robrus1 » Thu May 23, 2013 10:41 pm

I have never had a store card, but I started out with a secured card from Bank of America. After 12 months of on time payments, they unsecured it without me asking, and then I asked for a credit limit increase and kept the card (no annual fee at that point) for a while since it was my oldest card. 12 months of paying on time cleaned my credit score right up and I have never been denied for a card since then. Hope this helps.
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paparoach429
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Postby paparoach429 » Fri May 24, 2013 1:53 am

I had both of mine at the same time so they grew together. I would think if anything store credit cards help slightly more due to the fact that its not your money your using, its theirs. But then again you can deposit, I think up to 5k on the CapOne secured cards which with smart usage and payments would show your capable of handling a large credit line. Kind of wondered the same thing in the past but that's just my $.02.

MemberSince99
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Postby MemberSince99 » Fri May 24, 2013 6:45 am

Secured as a "major" card will be best for your score and report, though a store card certainly would help also. The scoring weights "major" cards like Amex, Discover, Visa and Mastercard a bit higher from what they say on the FICO site when you get your score.

CCG
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Postby CCG » Fri May 24, 2013 3:52 pm

Store cards are good to start with but it's also important to have at least one or two major credit cards. I would recommend trying out this tool to see if you pre-qualify for any.

ForumPheen
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Postby ForumPheen » Tue May 28, 2013 10:23 pm

Thanks everyone! I will look into those recommendations then. Got to get over my terror of hard inquiries if I want to play fast ball.

rockyrock
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Postby rockyrock » Wed May 29, 2013 1:26 am

ForumPheen wrote:Thanks everyone! I will look into those recommendations then. Got to get over my terror of hard inquiries if I want to play fast ball.


In retrospect the best advice I can give you is to be patient.

For a while the only card I had was a Sears store card, for some reason they were the only ones that didn't drop me after my first personal recession. A little later down the road I got a Cap1 secured card and built my way back up. Both of those cards are/were terrible in regards to APR and AF. Sears ended up closing my account due to inactivity a while back; I still have the Cap1 card after more than 10 years to help maintain my AAOA. I regret not using my Sears card enough to keep it active, that one was opened in 1995.

Because AAOA is a factor I recommend getting a no AF card as soon as you are able and just hold onto it. If the APR is high just don't carry a balance on it. I'm stuck paying $29 a year for a card I never use but it has my history...

Good luck!
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