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  1. #1
    Platinum Member rhipsher's Avatar
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    Default Bankruptcy two years in the past

    Hello everybody. I've never had a credit card up until recently. Most of my credit before bankruptcy was built paying car loans and mortgages off.

    It's been two years since BR. I went to Fry's electronics to buy a new Computer with no intentions of getting a credit card. But as usual the salesman convinced me to apply for the fry's electronics credit card. I was approved for a $2,000 limit. I asked him what the interest rate was on that card. He said 26%. I said are you kidding me? He said that's just the standard interest rate on a retail store credit card.

    So I paid the $1,950 computer off hitting it with $500 a month payments and paid it off quickly.

    I still knew that I needed to get a regular major credit card. So I went to my bank (WellsFargo) and applied for a Visa card. I was approved. So they sent me a Visa college cash back card with a starting limit of $700. So I plan to use it for gas and groceries and of course just pay the bill when it comes in immediatly. The card has 3% cash back on gas groceries and drug store purchases.

    My question is should I eventually get a credit card like an American express Blue cash card later on or just keep the college card I've read up on the top 10 credit cards to have and of course they all have their strengths and weaknesses. Since I don't travel much I don't really need airline miles. Cash back works for me. Would like to here suggestions from people more versed in the credit card game than me so that I can get the maximum benifit out of the cards. Thanks Rick.
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  2. #2
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    How long ago did you get those two cards?
    Amex Platinum
    Amex BCP 15K
    Amex SPG 5K
    Barclaycard Arrival Plus WEMC 5K
    Chase Sapphire Preferred Visa Sig 23.5K
    Credit Union Visa Platinum 10K
    Discover IT 5.75K
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    It depends on what you mean by "eventually". Amex is very well known to dislike BK, and I would not expect them to approve you for that card until your BK falls off. That will be a while since it's only been 2 years since BK.

    Honestly, 2 years after a BK you are doing well with 2 cards already. But to be getting dreams in your head of getting top tier rewards cards, well all I can say is if you get them, more power to you, but I wouldn't think it likely anytime soon. Most of the top tier lenders are much like Amex and take a dim view of recent BK. Makes me wonder WHY since you can't declare BK again for a while, but that's how they see it.

    Anyway, I honestly don't have much to tell you beyond take care of what you have and stay out of further trouble, and eventually you will get what you want, but I'd be shocked as hell if it's anytime real soon.
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  4. Platinum Member rhipsher's Avatar
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    Default

    I'll try to answer both in a nutshell. I got the Fry's card this last November. And the Wells Fargo Visa card last week. I've been with Wells Fargo for a long time. They are also the bank that mortgaged my house 11 years ago and still have it. So there is some time invested with them.

    The bankruptcy was chapter 13 "reorganization of debt". So we had to pay back all of the debt. It was supposed to last 5 years but we paid it off in 3. When it was over we had paid back over $58k and didn't owe anybody anything after that. But of course it's still on our credit and will be for a while. My wife decided to quit working and go back to school to become an RN years ago and that chopped our income in half. It was 10 years of struggling I'd rather forget. But now that's all changed and we are doing really well so I wanted to build my credit score back up to where it was at 770. We both applied for a Visa last week. I was approved and she was not. So even though we are married my SSN and her SSN are still ours and separate from each others luckily lol!

    I'm not interested in having 10 Major credit cards. Just a few to help build my score up over time with just everyday purchases like gas and groceries. It looks like the cash back reward cards like the one I have is a pretty typical 2-3% cash back on groceries and gas which is all I plan to use if for. Of course that 2-3% is only for the first 6 months and then goes down to 1% I think. And that is why I say eventually move up to a card with better perks.
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    I would submit that Amex doesn't like to see ANYTHING on a credit report where any kind of court action is involved.

    As time passes, you'll get more and more credit opportunities. Just be prepared to pay out the nose for them.

    You may also want to consider Dell Financial Services for future electronics purchases. If approved, they will give you six months interest free for purchases over (I believe) $500. I used it to buy my laptop.
    Cards and Credit lines Acquired:

    Escape by Discover (7.75K), Barclay Holland America Visa (7K), Macy's store card (5K), Bloomingdale's store card (2K), Citi Custom Credit Line (3.5K), PayPal Smart Connect credit line (2.7K), Chase Freedom Visa (5K), Chase United MileagePlus Visa (5K), Chase Sapphire Preferred Visa (5K), Amazon store card (2.2K), Lord & Taylor store card (500), Nordstrom store card (500), Gold Delta SkyMiles from American Express (3K), Discover It (6.5K), PayPal Credit Line (1K).
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  6. #6
    Platinum Member rhipsher's Avatar
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    After doing a little research on chapter 13 it looks like the 7 year clock starts ticking as soon as the court has approves the bankruptcy. It doesn't start after you've been discharged. So that means the bankruptcy is 5 years old. Not 2. And my credit score was good enough to get approved for one retail card and one major card. And I'm glad about that because it means that I'm on the road to recovery. Having great credit is very very important to me. Ironically Wells Fargo is the one who forced us into BR after they bought our mortgage. Even our Bankruptcy lawyers were shocked and appalled at how they were trying to pull the rug out from under our feet. That's a whole other story. But it's all over now and we both have a good relationship with each other and they have even suggested that I refinance my mortgage with them from 6.5% interest to 3%.

    But the reason I entered this site was to find answers that have to do with using credit cards to help me maximize my credit score in the least amount of time because I'm wet behind the ears in the credit card game. And just need a little push in the right direction and a few suggestions that's all.
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    Well, that's good news about the bankruptcy at least.

    I spend equal amounts of time on this site as well as myfico and I have learned that a lot of cards out there are in the YMMV (your mileage may vary) category with respect to approvals and credit limit increases (CLIs). For example, I see people post that Discover never gives them an auto CLI and yet I get one worth about 10% of my current CL every three months or so. Nothing huge but it makes me feel appreciated. The same applies to approvals. Comments regarding how they were shocked to be approved for card "x" and then a different poster wondering why they didn't get approved for card "z". Obviously, there is just no rhyme or reason for a lot of them.

    I recommend applying for two or three new cards every six months or so until you are where you want to be.

    Amex is not the gold standard that it once was. There are cards in the market that are just as good or, in some cases, better. If you have your heart set on Amex just be patient. You'll get there eventually. One company I have read very good things about is GE. They offer a variety of cards branded for everything between WalMart and Lord and Taylor; Amazon, Ebay, Sam's Club, etc. I have read that they are very generous with CLIs. I don't know how kind they are with approvals, but one or two may be worth a shot. Post your success rate and hang in there. You didn't get where you are overnight and the road back can be just as long.
    Cards and Credit lines Acquired:

    Escape by Discover (7.75K), Barclay Holland America Visa (7K), Macy's store card (5K), Bloomingdale's store card (2K), Citi Custom Credit Line (3.5K), PayPal Smart Connect credit line (2.7K), Chase Freedom Visa (5K), Chase United MileagePlus Visa (5K), Chase Sapphire Preferred Visa (5K), Amazon store card (2.2K), Lord & Taylor store card (500), Nordstrom store card (500), Gold Delta SkyMiles from American Express (3K), Discover It (6.5K), PayPal Credit Line (1K).
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    Since you just got the Wells Fargo card, my suggestion would be to use this card and pay on time for at least 6 months (I'd wait 12), and give it a shot (depending how your credit scores look). If you're denied, wait until the BK falls off.
    Amex Platinum
    Amex BCP 15K
    Amex SPG 5K
    Barclaycard Arrival Plus WEMC 5K
    Chase Sapphire Preferred Visa Sig 23.5K
    Credit Union Visa Platinum 10K
    Discover IT 5.75K
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    For sure don't apply for an Amex until that BK is gone, otherwise it's just a wasted inquiry.

    You know that's part of why I haven't applied for a mortgage. Part of it is I don't want to put 20% down, and I wouldn't want a place I could do that with right now, but also I don't trust the bankers in the end. Anyone can lose their job at any time for any reason or no reason at all, it's all "at-will" employment (though they damn sure expect at least 2 weeks notice if you leave) so you can lose your job just because management wants to hit numbers to get a bonus (I've worked at places this has happened). They couldn't care less about you, honestly. So I'm scared to pull the trigger and probably never will. That's another great reason to stay out of credit card debt too, your master could decide at any time you are expendable and you get walked to the door in the "march of humliiation" like a criminal in front of all your colleagues. One thing I have to say about that - I'll be damned if I'm leaving without my personal effects such as phone, jacket etc. They will need to call the cops and arrest me if they intend to keep that stuff, and yes I realize the law will allow them to do whatever the hell they please this is after all the corporate States of America we are talking about, but they will have to have me arrested if that's their intention, I've decided that. Hope it doesn't happen but if it does, I'll be arrested before I leave without my things.
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  10. #10
    Platinum Member rhipsher's Avatar
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    Owning a house is one of the best investment anyone can make. You get to write off the mortgage interest every year. You get to write off any home improvements you make to it. And the mortgage you pay every month goes toward ownership. When you rent you get none of that. Your just paying for the right to stay on the premises month to month. Home ownership is part of the American dream.

    Over the years I've been lucky enough to have acquired a few toys aside from my daily drivers. A Corvette ZR-1 and a 1968 Mustang. And there's no way I'd want to park them in an apartment parking stall. They stay tightly lock in my two car garage until I want to beat the pavement up with them. The daily drivers stay in my driveway.

    Now I can understand if your very young and in college. Most people in college can't afford home ownership at that point in their lives. But when your a little older and well established in your trade and ready to raise a family then it will be more important. But if you can afford it home ownership at any age is not a bad idea. It also looks good on a credit report.
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