Advice regarding my account from college

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vjane89
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Advice regarding my account from college

Postby vjane89 » Sun Nov 10, 2013 4:31 pm

Hi all.

While I was in college, I attempted a few times to get a cc, but was always denied. Turns out I had a $3 charge that I did not pay from my electric company while in college. They sent it to collection and bam, my credit was destroyed.

So, I got a Capital One secured cc to build my credit. At the time, I thought it would eventually be "graduated" into an unsecured card, but obviously I was a little oblivious. I've had the secure cc for about a year now and I just got accepted for an unsecured card with Chase Freedom for $500.

I want to cancel my secure card because 1) I pay an annual fee and 2) I want my deposit. Before I cancel, I would appreciate some opinions. Is is a good idea to cancel this card given the fees I have to incur, or will it destroy my credit even further? Or should I wait and build up my credit with my Chase Freedom before canceling my Capital One secure card?

Any thoughts would be appreciated! Thanks.


MemberSince99
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Postby MemberSince99 » Sun Nov 10, 2013 8:19 pm

You might want to think about adding another card, say Discover, though the rewards are similar to your Freedom card or an Amex charge if enough time has passed since that collection. Once you get one more tradeline you will be "optimal" for scoring and you can go ahead and cancel that Cap One. If you've already paid the next year's annual fee, you might as well leave it open and just cancel before that comes due again.

vjane89
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Postby vjane89 » Mon Nov 11, 2013 12:19 pm

Thank you for the response.

I paid my annual fee for the secured Capital One card in April, so I will wait until the end of March to cancel.

I just applied for Chase Freedom yesterday and got approved for $500 at 22%. That is a pretty high percentage…should I be worried? I only plan to use this cc to build credit, and I will pay it off each month, so the interest rate should not be a problem. I have not yet received my card….should be here in 7-10 days.

Since I just applied for the Chase card, how long do you suggest I wait before I apply for another card with another company?

MemberSince99
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Postby MemberSince99 » Mon Nov 11, 2013 4:34 pm

You should only be worried if you plan to carry a balance - if you PIF it's not an issue. So since you will pay it off it really doesn't matter.

I would actually apply for say Discover now if you are going to. They seem to like, from what I've read, the idea of being your "first" and only prime card and if you are the sort who might carry a balance they may be disposed to give you a decent limit off the bat.

I would want to add one more "prime" type card if you can. That would give you two even after cancelling Cap One. Then use those and PIF and take care of them for 6 months to a year, see where you are at that time, and go for a couple more.

I'm not sure how long ago that collection was, if it's recent, don't go for Discover. If Chase approved you, it must be an older collection, but I've read Discover isn't favorable to them (neither is Chase for that matter but you got in there) and Discover doesn't recon unlike Chase so that one is kind of iffy if you want to apply for it. I say if you don't get another card, keep the Cap One until you do. If you don't get another card now wait 6 months then try again until you do then dump Cap One. Make sure you have two of them open to help your score as much as you can because the scoring prefers two cards over one.



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