How long does it approximately take to gain credit?

What can I do to get a higher credit score using a Secured Credit Card?

• Ok, so this past Monday, I went to my bank financial institution and put down a $300 dollar deposit for a Secured Credit Card. I have opted out of the overdraft monthly fees, so I will not ever be able to spend more than I have on my new secured credit card. My bank financial adviser said that, after 6 months to a year, they will upgrade my secured credit card to a REAL regular credit card, and they will then refund me my $300 dollar deposit. My question to you all is, in the mean time, since I have my secured credit card, how can i gain and get a higher credit score? Because I want my credit score tor be way up in the 800's! How many years will that take, and my much money will I have to invest in every month in paying off my credit card balance?

• Answer:

  If you pay the balance every month and don't carry anything to the following months you won't be stuck paying interest. (example: you spend $200, pay $200 there will be no interest. If you spend $200 and pay $100 back you will owe interest the next month on that leftover you didn't pay) You shouldn't have to necessarily "invest" into building your credit. Have things you normally pay for anyways auto-bill your credit card (like your cell phone or car insurance, a different utility or use it to solely pay for gasoline for the month.) BANK the money you would have normally spent on those things and then use it to pay the bill off when it comes. The only time you should have to spend more than what you actually charged on your account is when you carry a balance over to another month or only pay the minimum due (and paying the minimum should be an absolute last resort because once you get stuck paying just a minimum you won't even make a dent in the interest charges and the balance will never go down). Credit scores are made up of a lot of different things. It is unlikely you will have a score in the 800's with just one or two credit cards. Variety helps make it higher (like a car loan, personal loan, mortgage) and other things can make it lower (late payments, inquiries from applying for new credit, new accounts usually hit the score and knock it down a bit but once they start getting used or age they make up for the small dip in score that you have to take to acquire them). Your bank explained that if you have a history of late payments on the card or stop paying that you might not get your deposit back in that time frame (or at all, in the case of not paying on the account) ? It could take a few years for you to reach the 800's scorewise but there is a lot more that creditors look at when deciding who to lend to and how much, that isn't related just solely to a credit score. They look for specific things like payment history (they like to see no lates), no overlimit usage, average of 30% utilization across all accounts combined (your limit is low, but 30% would be $30 in your case. So using more than that on a regular basis would look more bad than good overtime... BUT once you are able to get more accounts it will look better... Let's say you get another card in 6 months in addition to this current card and they give you $1,000. That brings your overall limit to 1,300 and 30% utilization would be $390 so even if your current card had a higher usage, if you got another card later on it would help raise the amount that you can use without going over the 30% or so that they like) When you DO get any other cards (before this one unsecures or after) do NOT close out the original account. It will help the age of your report. (example: in 6 months or even 2-3 years, you get a second account. If you close the first account you are back at ZERO for age on your credit report for how long you have been building credit, which looks BAD. Keep it open just for the sake of keeping the age of your report. Lenders like to see a credit history that is older... the older the better. I could ramble on forever about this stuff. If you want to, feel free to email me with any questions you may still have. :) Contact info is available in my profile.