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Both DH and I got new, unsecured credit cards -- what's the best way to re-build?

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    #1

    Both DH and I got new, unsecured credit cards -- what's the best way to re-build?

    his limit is $300, mine is $500 (Orchard Bank unsecured, $39 annual fee each)

    We are using these *only* to rebuild our credit so we are in the position to qualify for a mortgage in 3 years since our foreclosure is completed too.

    I thought we should limit our spending to 10% of credit line each month. Does it matter if it's an automatic payment every month (say our netflix account) OR is it better to have it be an actual charge - varying in amount each month?

    Also, is it a good idea to carry a small balance every now and then? If so, is it best to carry for a few months and then pay off monthly for a few months and repeat?

    I not looking to get more credit cards -- if this one alone would work to bring up our credit score -- that's fine by me!! Our only other open account is my Honda loan which has about 12 months to go.

    Thanks so much for any advice.
    Tags: credit rebuilding, utilization
    #2
    All of the expert financial advisors say to not use more than 30% of your credit line so 10% would be great. I don't think it really matters if you have a recurring charge or different charges. The credit reporting agencies look at whether or not you make your payments on time and how much of your available credit you use.
    A good financial advice website is bankrate.com. Hope this helps!

    Comment

      #3
      yes, we got capital ones...and are going to do the exact same thing!
      8/4/2008 MAKE SURE AND VISIT Tobee's Blogs! http://www.bkforum.com/blog.php?32727-tobee43 and all are welcome to bk forum's Florida State Questions and Answers on BK http://www.bkforum.com/group.php?groupid=9

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        #4
        Carrying a small balance on the cards does not really help your score and could hurt it on small limit cards since even a small charge will up the utilization quite significantly on a card with a $300 limit.

        Use the card for small purchases, and pay in full and you should be fine in my opinion. The positive trade lines will help your credit score.
        You can't take a picture of this. It's already gone. ~~Nate, Six Feet Under

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          #5
          bts....you may one of the only one's that appreciate this...but we just have had our capital one cards a few weeks now...and HE GOT his line UPPED to 2k??? that's sexist...isn't it...LOL!!!

          we haven't even used them yet??? odd?
          8/4/2008 MAKE SURE AND VISIT Tobee's Blogs! http://www.bkforum.com/blog.php?32727-tobee43 and all are welcome to bk forum's Florida State Questions and Answers on BK http://www.bkforum.com/group.php?groupid=9

          Comment

            #6
            Originally posted by tobee43 View Post
            bts....you may one of the only one's that appreciate this...but we just have had our capital one cards a few weeks now...and HE GOT his line UPPED to 2k??? that's sexist...isn't it...LOL!!!

            we haven't even used them yet??? odd?
            It's very sexist, but typical.

            They are tempting you to buy something. I know you are too smart to fall for that classic trap.
            You can't take a picture of this. It's already gone. ~~Nate, Six Feet Under

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