Thread: Questions about Capital One and their new Cash

I have a few questions regarding the new Capital One Cash card:

1) I see this is a World Mastercard, does it have ALL the World Mastercard benefits? Such as concierge service and other benefits?

2) I have excellent credit, and my other credit card is an Amex Blue Cash with 15k CL...however I have heard Capital One gives horrible CL's and I'm worried about only getting a 2k CL. Despite this credit card being for "excellent credit" people only, has anyone heard what kind of CL's they are giving people with this card?

3) I have heard their customer service is horrible, would that be the same with this higher end card of theirs?

Thanks!

1) It does seem cool no? It does have all the World MasterCard benefits. I cannot confirm if Capital One reports the limits on their World and Signature cards.

2) Keep in mind the people that are complaining about the low limits. People who have terrible credit and are rebuilding. Many of these same people want instant results after one or two years and are unable or unwilling to wait it out. Capital One likes to see usage, usage, usage and several years of cardmembership before they hand out larger limits. If you aren't using your card, they feel that the limit they have established is sufficient. Now, having said that, there are people who have had their Cap1 cards for years and they have excellent credit yet their credit lines are stuck in the low thousands. This card, along with their Venture card is their foray into the Prime credit market; however, I would guess that they would still issue a limit that is lower than the competition. So, if Chase gave you a Freedom Visa Signature with a $10,000 limit I would guess that Cap1 would give $5,000-$7,500.

I personally started out with Cap1 nearly 14 years ago as my first card. It was a Standard MasterCard with a $300 limit and 19.8% APR. Over the years they upgraded the account to Gold and now Platinum No Hassle Rewards at $10K limit and 10.9% fixed APR. So clearly, everybodies results may vary, but Capital One has been very, very good to me over the years.

3) I have had no complains with their customer service. It has been on par with Citibank and Chase if that is saying anything.

As always, be sure that you really research the rewards to see if it warrants a new account. It has been my experience that these reward cards start out great and over the years they change the rewards to the point where it is almost not worth it anymore. For instance, Discover's Cashback Bonus is a ghost of its former glory and my Citibank Dividend used to be awesome with 5% cash back on groceries, gas and drug stores. Now it is 1% on everything with quarterly 5% bonuses- half of which are worthless to me: home improvement, travel, dept. stores.......

Well after further research, I found out it's only a World Mastercard if you get approved for a CL of over 5k, anything less is just platinum (have no way of knowing which you'd get until it's too late). I am also worried about how Capital One reports their credit limits to the bureaus, the only reason for this card is to improve my credit score (to make up for lacking loans/mortgages), and for no international fees...starting to sound like a Chase Sapphire Preferred would be a better option for me as that would certainly give me a great CL and report to bureaus better. Thoughts?

Originally Posted by JohnB222

Well after further research, I found out it's only a World Mastercard if you get approved for a CL of over 5k, anything less is just platinum (have no way of knowing which you'd get until it's too late). I am also worried about how Capital One reports their credit limits to the bureaus, the only reason for this card is to improve my credit score (to make up for lacking loans/mortgages), and for no international fees...starting to sound like a Chase Sapphire Preferred would be a better option for me as that would certainly give me a great CL and report to bureaus better. Thoughts?

Well, what are your scores? How long have you had credit? I believe Capital One checks all 3 bureaus.....what are your limits like on your other credit cards? Usually, banks try to match your highest limit if they really want you. But yes, most banks set the World/Singature level at $5K and above.

If your ONLY reason for a new card is to improve your credit to debt ratio than you will want to stay away from reward cards as they are almost always Signature/World (Citibank and Nordstrom Visa do report the limits). Keep in mind too that opening a new credit card will really ding your FICO score for a good year as it is a new account and it will lower your average age of account (AAoA). You may be better off getting a credit line increase on one of your existing credit cards rather than opening a new account.

You mentioned that you have an Amex Blue Cash. What year was it opened? For the cost of an inquiry you could open another Amex card (directly from Amex itself, not BofA or Citibank etc) and that new account will be backdated to the year you opened the Blue Cash. That would be the best solution in my humble opinion as it would not hurt but could actually help your AAoA.

Chase Sapphire is almost always a Visa Signature/World MasterCard. I can tell you that Chase does not report limits on their Visa Signature/World MasterCard products. My Chase Slate (Platinum) reports and my Chase Freedom Visa Signature does not.

You mentioned a lack of installment/mortgage trades. You could join a credit union if you do not belong to one already and apply for a small personal loan (apply for the loan at the same time as membership so you only have one inquiry). Seriously, like $1,000 or $2,000. Pay it off in a year and you have instant installment history for the cost of a few hundred dollars worth of interest. If you get a secured loan (the loan is secured by your savings (called share savings in credit union speak)) than the interest would be even less.

But again, any new account (except a backdated Amex) is going to really hurt, not help, your credit score (at least initially).

Thanks for your help, I really appreciate it. I have had credit for 7 years, I had one credit card from 2004-2006 with a 20k CL which I closed due to inactivity (before I knew it would be a bad thing to close CC's), and have had my Blue Cash since 2005 which I just upgraded to a 15k CL (had 6k CL before). I am unsure what my score is off the top of my head, but I have never carried a balance on any of my CC's ever. Do you really thing Capital One would give me a 15k CL off the bat?!?

I have two reasons to open a new card, to diversify my credit report and I'd like to find a card that has no international fees. I don't travel internationally often, but I am looking at planning a trip to Canada soon and that would be helpful I think. I don't plan on opening more than one, or opening another afterwards.

So if you think I should open another Amex and have it backdated, which card would you recommend? Also don't you think they wouldn't give me a huge CL because I already have a decent $15k CL won't they lowball me on my second card? Also I know Amex doesn't have any good promotions going on (except for Blue Cash, which I already have) and the Sapphire Preferred carries a $650/$500 bonus right now which sounds good.

So if you're saying I should stay away from a rewards card since most reward cards don't report limits, what kind of card would you recommend? I did buy a car approximately 2 years ago which I got a loan on (when I could have paid cash instead) just to get a small installment loan on. I believe it was a 3 yr loan, but I paid it off in approximately 8 months I believe.

Thanks so much for your thoughts, they have been extremely helpful!!!

After I wrote that I saw your post on the MyFico website....

I do not think Capital One would give you $15K off the bat. I would assume $5,000-$7,500. I am sure you have great scores but your file is a bit thin. It is very good that you have not gone out and opened a ton of credit cards though.

Okay, so, now I am going to completely go against what I told you earlier. Because you have only one credit card right now, opening another, preferably Visa or MasterCard, will not be the end of the world. Especially if you have no plans on buying a home or car in the next year.

This is your opportunity to get the card that you really want and that you feel will benefit you the most (as always, only apply for credit when you need it). If you really do want the Chase Sapphire then you should do it. I see that it does not have a foriegn transaction fee. It is true that the Chase Sapphire (which would likely be a Visa Signature) does not report a credit line; however, it sounds like you have a pretty decent income or at least a lot of extra cash. So, as long as you plan on paying the account in full each month then it should not have a profound effect on your credit score. Especially with the $15K available on your Amex. I understand that the banks and FICO have a way to recognize World and Signature cards so that they do not effect your credit to debt ratio but I cannot confirm this. (Revolving accounts report as R on your credit report, so a current revolving account would be R1 and NPSL cards report as Open, or O1-so they would omit the O1 accounts from being averaged in with your R1 accounts).

My only concern in my original posts was that you had very little credit and a Signature/World card could hurt you. But in the end, I do not believe it will impact you negatively in the long run (just be sure not to carry a large balance).

So if you have no plans on buying a home or car within the next year or so, then I say go for it. Your FICO will take a hit because of the new account, and it will lower your Average Age of Credit; however, these things are temporary (hence the recommendation to avoid a new card if you are planning on buying a home or car soon) and your scores will bounce back within a year or two.

I hope I have not confused matters too much. It sounds like you have a very level head and you don't apply for credit willy nilly like most here (and on MyFico). So, one Signature/World card will not hurt you long run.

Now, in terms of which to go for....that is still up in the air. You don't want to chance getting a small limit from Capital One, but the Sapphire with no foriegn fee has an annual fee of $95 after the first year-which negates the no foriegn transaction fees in my humble opionion, unless you plan on using that card for all the other benefits.

Again, I hope I have not confused you too much, and maybe some of the folks at MyFico can steer you in the right direction as to which card to choose. I honestly have to say if the no foriegn transaction fee is what you are really after, I would go with Capital One. Because it is a reward card, they are going to want to get you into a World MasterCard which means at least a $5K limit. If you use it regularly, you can likely have that increased down the line. If you are looking for the other perks and the VIP look and feel of a prime card, then the Chase Sapphire is hard to beat as long as you don't mind the $95 annual fee after the first year.

Yes, I have posted some similiar questions on the MyFico website...just trying to reach the biggest audience of people as possible so I can get best recommendations/ideas as possible. I am not an international traveler, just planning a trip to Canada within next year and think it may be a good feature to have...to be honest I would prefer Capital One so I could keep that account open longer, I feel I won't keep the Sapphire Preferred open as long since it does carry an annual fee...but I'm worried about a low credit limit, plus Sapphire Preferred has that great $650/$500 offer going on right now I think it could negate the annual fee for at least 2-3 years.

I don't have plans on buying a home or car in next year, and yes I am looking to expand my credit portfolio...that is PRIMARY purpose of adding another card, so that is a priority to find something that would help my credit! I do have excellent credit though, just trying to get it better to make up for lack of installment loans.

My current idea is to open a Chase Sapphire Preferred for 2-3 years to take advantage of $650/$500 bonus and will use for restaurant/fast food purchases since that is 2x points, open a PenFed Cash Rewards for 5% cashback on Gas, and upgrade my legacy Blue Cash to Everyday and use that for Groceries and all other spending...are you abandoning your recommendation of opening a second Amex to increase my Average Age?

Thanks for your kind help, again, I can only do so much research before I need someone to set me straight or give me fresh and new ideas! I am not going credit crazy here, I have been doing research for 3 weeks now...

Heh, just read your posts on MyFico again....if you are interested in PenFed then the Promise Visa is a great card and I believe it too has no foreign transaction fee or annual fee.

However, if you do want the PenFed, that should be the card you go for first as PenFed is very, very conservative. People with excellent credit have been declined for their cards. PenFed even has a word they use called Pyramiding as the reason for decline if you happen to have balances on other cards. You should be fine though.

It also looks like I got the second Amex stuck in your head. Don't worry about getting the second Amex at this point as there is no real need. You primarily wanted a no foreign transaction fee card and one that may report a limit. If that is the case then go with the PenFed Promise card.

Don't bother with the PenFed cash card because you already have the Amex Blue Cash (you don't want to end up with several of the same reward cards). If you spend enough at grocery stores and gas, then go ahead and upgrade the Amex Blue Cash to a Blue Cash Preferred with the $75 annual fee and use that for almost everything. And then you can use your PenFed Promise for foreign travel. I did not realize you were a member of PenFed.

So my suggestion at this point is go for PenFed Promise. They give great credit limits that report and there is no fees on that card. Don't go around applying for the Cap One or Chase or even a second Amex at this point. The PenFed Promise is all you really need it sounds like.

Originally Posted by JohnB222

Yes, I have posted some similiar questions on the MyFico website...just trying to reach the biggest audience of people as possible so I can get best recommendations/ideas as possible. [COLOR="rgb(0, 0, 0)"]Nothing wrong with that at all. I think it is smart to get as much information as possible from several sources.
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I don't have plans on buying a home or car in next year, and yes I am looking to expand my credit portfolio...that is PRIMARY purpose of adding another card, so that is a priority to find something that would help my credit! I do have excellent credit though, just trying to get it better to make up for lack of installment loans. Ultimately, the only way to really make up for the lack of installment loans is with an installment loan. Part of your FICO score is a mix of credit. The ideal mix would be a few revolving, installment and mortgage. However, in your case, a second credit card account is a good idea.

My current idea is to open a Chase Sapphire Preferred for 2-3 years to take advantage of $650/$500 bonus and will use for restaurant/fast food purchases since that is 2x points, open a PenFed Cash Rewards for 5% cashback on Gas, and upgrade my legacy Blue Cash to Everyday and use that for Groceries and all other spending...are you abandoning your recommendation of opening a second Amex to increase my Average Age? Yes, at this point a second Amex would not really benefit you as you already have one and you are interested in obtaining a Visa/MasterCard to beef up your credit. Eventually, down the road if you feel your FICO score could use a boost, a second Amex would be a good idea to increase your AAoA because the new card would be backdated to 2005. But for now, as you are not looking for a home or car, you shouldn't need to worry about AAoA.
Thanks for your kind help, again, I can only do so much research before I need someone to set me straight or give me fresh and new ideas! I am not going credit crazy here, I have been doing research for 3 weeks now...

No problem, I just hope I have not confused things too much! Again, based on what I have read on MyFico I believe the PenFed Promise Visa is your best bet all around and then call Amex to upgrade your Blue Cash to Blue Cash Preferred (only if the $75 annual fee would be wiped out by your grocery and gasoline purchases). Down the road say in 4 years you need or want a FICO score boost, you could consider a second Amex to help increase your AAoA but for now it just isnt necessary for your current goals.

PenFed DOES have foreign transaction fees, but it seems very promising that they give high limits...I figured as such since it says on their website limits up to $50,000. I am not a member currently, however I know you can join for $15 so I am not worried.

Amex Blue Cash Everyday only gives 2% cashback on Gas, and as a single guy I don't do much grocery shopping (so BCP is out of question for me), so I am really interested in the 5% cashback on PenFed.

I am glad you are advising against the second Amex though, that threw me for a loop! It does sound very logical though, and may be something I will want to do prior to buying a house...I appreciate the suggestion!!!

I will continue to plan on getting Sapphire Preferred, and PenFed...both on same day or something since they pull from different bureaus, and upgrade my legacy to Blue Cash Everyday and call it a day!

I appreciate your time so very much, I hope someone else in the same situation as I can take your valuable information you provided me with and help themselves as well. Unless anyone else has any other ideas