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Tincrow

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I gained almost 150 points in less than a year!
I see a lot of people asking about how to drastically increase their credit score, or asking if it's even possible. This is my story about how I gained almost 150 points in less than a year. Hopefully this will help give some insight and ideas to other people struggling to improve their credit situation.

My journey begins in May 2016. Well actually, that’s when I first became self-aware in taking an active interest in my credit score after being rejected for a credit card. My journey truly begins several years earlier with several missteps and stupid decisions. My first big mistake: Not taking my student loans seriously and paying them back sporadically, sometimes even walking that thin razor’s edge of almost falling into collections. My second big mistake: assuming that because I’ve never owed money on my debit card that somehow qualified as “good credit” instead of actually getting credit cards. My third big mistake: having no other payment history, accounts, credit line, or anything besides that solitary student loan started me with a whopping low score of 530. Yikes.

What can you get with a 530 credit score? Diddly squat. Well no, you actually can get: crazy inflated loan rates, credit card denials, car loan denials, and basically more points taken off an already ailing credit score.

So I took stock of my credit score and evaluated the places I needed to fix the most. I had eleven missed payments on my student loans, so I needed to get as many on time payments as possible to pull that number up. I also only had only one account, the student loan; I was going to need more accounts to round out my score. Finally I needed to establish lines of credit by getting credit cards. So I decided on a three pronged approach: get more ontime payments, get more accounts, and get credit lines. In order to maintain what little score I had, I knew I had to be careful of hard inquiries; I was not going to apply for anything unless I was absolutely certain I would get approved.


First I took care of the student loan. I applied for deferment (basically temporary leniency) so I could stop the missed payments, get my money in order, and begin paying that sucker off. In just a few months I was able to get ahead of my student loans where I was paid ahead and able to rest a little easier-- but I couldn’t relax and get comfortable. I kept a regimented schedule of paying significantly more than I needed to in order to knock that number down.

Next I got a secured credit card from Capital One. What is a secured credit card you might ask? It’s when you’re so untrustworthy to credit card companies you need to put up cash as collateral for them to even issue you a card. It works the same as a regular credit card, the company just needs insurance in case you mess up your payments as my war-torn-swiss-cheesed payment history suggested I inevitably would. So I got a secured credit card by putting down $50, for a whopping $200 credit line. Yeah you laugh, but that’s $200 more than any other credit card company was willing to issue me at the time. So I went with it and I used it sparingly. Anytime I purchased something, I paid it off *** soon as it appeared on my online statement. I kept my usage well below 10% with zero missed payments.

My next step was to join a credit union. I already had an account with a regular bank, but I needed to join a credit union to get secured loans. What are secured loans? Same thing as a secured credit card: it’s taking out a loan by putting up money as collateral. It kinda doesn’t make sense and makes perfect sense at the same time. I needed proof on my credit history that I could pay back loans, but no institution trusted that I could pay back said loans because of my credit history… so putting up money to take out money was the only way to do it.

Now secured loans don’t cost a lot per-se, but they have a sizable minimum for collateral and that money becomes unusable while it’s slowly being loaned back to you. I ended up getting two secured loans for $500 each to be paid back over the course of one year at a loss to me of about $8 in interest per loan, for a grand total of $1,000 tied up for a year and $16 in loss. But what were the gains? Basically 2 new accounts to fill out my credit score and 24 on time payments that are automatically deducted from my account. So when you really think about it, I only paid $16 for a guaranteed boost to my credit score.

Next I started hunting for another credit card. After doing my research, I found the Discover secured card. This was the same thing as my Capital One secured card, except Discover offers cash back points. No other secured credit card I’ve seen offers cash-back points so this was a big win. So I put up $200 collateral for a $200 line of credit. Also it’s worth mentioning that after a year or so of on time payments Discover gives the option of converting to an unsecured card, meaning I get my collateral back and get to keep the card and keep the length of history for the card without making a new account. So win - win.


Between my Secured Capital One card and my secured Discover Card I had amassed $400 in usable credit. Still a small laughable number, but at this point I had my student loan, two secured loans, and two credit cards earning me five on time payments every month. I was gaining positive momentum, pushing my credit score ever so slowly up that steep hill to about 575+ in three months. I was on my way.

Now that I had a credit card that would actually reward me for using it, I shifted all my spending onto the Discover Card. My Capital One secured card became my use-only-once-a-month-and-pay-it-off-card so I could keep getting the good payment history from it. I paid off my Discover card religiously. As soon as payments posted I paid them off. Sometimes I’d be paying off my Discover card three or four times a week, sometimes paying off just one purchase at a time, all to keep my credit utilization below 10%

At this point I was in a pretty good place. Both new credit cards earned me a hard inquiry, and between them and my loans it knocked down my average age of accounts considerably. But, my on time payments, total number of accounts, and low credit card utilization had balanced it out and my score was climbing. I had broken into to the low 600+ in just a few more months.

Feeling determined, I went right back to my credit union and got four more secured loans. With six accounts that was roughly $3000 tied up in secured loans. But the way I rationalized it was this:
1. My money is all tied up so I can’t spend it-- I’m saving money.
2. If I wasn’t spending it, my money would be sitting around in a savings account making only minimal gains.
3. The cost of interest and not being able to use this money for a year is nothing compared to the added interest I’d pay for a loan on a car or a house a couple years from now… so this was basically an investment into my future.

So I now had one mostly paid off student loan, six secured loans, and two credit cards. Every month I was getting nine on time payments. Yes NINE on time payments to slowly average out all my stupid missed payments. I put more collateral down on my Secured Discover Credit Card bumping my credit line to $500, and a month later Capital One extended my credit line to $500 just because my credit score had improved so much. I was now at a combined credit limit of $1000. A few more months of on time payments, frugal spending and keeping my credit utilization low and I had crept up to a solid 650. I was finally ready to make the plunge and get a big boy credit card.

I had my eye on the Chase Unlimited card for quite some time. Truth be told, I applied and was rejected for the Chase Unlimited card almost a year ago which started my credit score journey. This time I knew my numbers, I knew my score and I knew I had a pretty good chance. So I took the leap-- and I got approved for $2000 worth of credit. The Chase card became my primary card and the Discover card and Capital One card became use-only-once-a-month-and-pay-it-off-cards.

I now had a student loan that was paid ahead by several years, six secured loans, three credit cards with a combined credit limit of $3000 which brings me to my final score of 671. From 530 to 671 in less than a year. That’s 141 points. Most low to mid-level credit cards were within my reach if I wanted more cards but at this point I was pretty comfortable with my climbing score.

And what did it cost me? I tied up about $3550 for about a year, but all that money would be coming back to me by the end of the year. I paid about $48 in interest on my secured loans and everything else was just time and effort.

So that’s my credit story. My score is nowhere near perfect and I still have a lot of ways to go but hopefully this was helpful in giving others an idea of what is possible with some planning and hard work. Thank you for reading.

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Congratulations and thank you for sharing your journey with us. Anyone in credit despair should benefit from reading your post.

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