Help! Need to rebuild credit score after losing my job

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Help! Need to rebuild credit score after losing my job

Postby Newbieinneed » Sat Sep 14, 2013 2:56 pm

I am very young and new to the credit game, I have no clue what I am doing!

I had a credit score of 750 due to school loans and my bank allowed me a credit card ( Bank of America cash rewards) with a $700 limit. I was temporarily working at Victoria secret and they talked me into getting a card there. I was approved for a $500 limit.

But here is where my problem comes, I had lost my full time job!

I did have account assurance on the vs card but they did not help me and then late fee's piled up! I was so frustrated getting calls everyday. I cancelled the card, since I am back on my feet again, and paid the balance off.

I have came to this forum and I have read that canceling a card will KILL your score! Smh I feel so stupid I shouldn't have done that, I went to check my score *wait for it* My score is now 534! :-/ Poor is what it reads!

Someone please chime in on where I can go from here? The best thing to do now? I have been keeping my BOACR card up to date because if you mess up with Bank of America your done! Should I apply for other cards to possibly improve my score? Or should I leave it alone for a while? Please help!

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Postby randeman » Mon Sep 16, 2013 12:11 pm

You can apply, but I think most grantors will turn you down. If it were me, I would guard your remaining card with my life and be prepared for BOA to cut your limit once they find out about your situation. Sadly, you are going to have to start over again. When you're working full time again, see if you can get a secured card or loan. These will help. Just be prepared for it to take time (possibly a lot of time) to get yourself back on your feet. Credit is unforgiving once it's messed up.
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Postby takeshi » Mon Sep 16, 2013 12:42 pm

Newbieinneed wrote:I have came to this forum and I have read that canceling a card will KILL your score!

It's really not so straightforward. For some, closing a card will have little to no impact. For others it can have a much bigger impact. The biggest impact is usually to utilization as you'd lose X in available credit. The math is simple and you can compare your utilization before and after closing the account before making the decision.

It sounds like you need to pull your reports to verify what's on them and read up on credit scoring. Payment history is an important factor and all your lates probably aren't helping but at least it's now paid off. Utilization is another major factor. You can reduce your reported utilization by paying down your balance before the statement closes. Your balance at statement close is what is reported to the CRA's and used to determine your utilization.

You can certainly add a secured card to help rebuild but there's no quick fix and the majority of what it's going to take to rebuild is time. Read up before making any credit decisions in the future and make sure you understand how your specific situation will be impacted before doing anything.

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Postby joy mali » Thu Oct 17, 2013 4:58 am

Closing a card with high fees or interest rates may be the best option, especially if that is only going to sink you further into debt. For some people closing these cards will have very little impact on their scores, while for others it can have a much bigger impact. The biggest issues you need to be aware of when looking at closing a credit card is that you will lose that much in available credit. You should monitor your credit score and talk to someone at your bank or credit union about the options that are available to you.

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