Why Should You Check Your Credit Score
A healthy credit score can make a big difference to your life. The better your credit score, the more likely you are to be accepted for different types of credit. Using CreditWise can help you understand and improve your credit score. You can see what’s holding back your credit score and what’s going well. You’ll even get tips on how to improve your financial health. It also means you can spot any mistakes and get them sorted so they don’t count against you.
Understand That Building Credit Takes Time
When it comes to building credit, there are no shortcuts. Building credit takes time and responsible financial behavior.
But that doesnât mean youâre out of luck if youâre establishing credit for the first time or trying to improve your chances of being approved for a credit card. You could consider options like a secured credit card, becoming an , setting up a joint account or getting a co-signer on a loan.
And some companies have even developed alternative scoring methods to determine creditworthinessâmethods that consider information not typically used in credit reporting. So keeping up with things like your rent, phone bill and bank account transactions could help you build credit too.
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The Eno browser extension for virtual card numbers is only available in certain web browsers, and enrollment is required. Virtual card numbers are not available for debit cards and some credit cards.
Should You Get This Card
If your credit score isnt great or you have little experience using credit, Capital One QuicksilverOne Cash Rewards Credit Card is a good option for earning rewards on every purchase while you build credit.
Unlike many starter credit cards, you will pay a $39 annual fee. Youll need to spend at least $2,600 on your card annually to offset that fee with the 1.5% cash back rate.
Also unlike some other credit card options for bad credit, the Capital One QuicksilverOne Rewards Credit Card is an unsecured credit card. This means you can use it to build your credit score through responsible use without having to put down a cash deposit as collateral.
While the credit limit on your Capital One QuicksilverOne Rewards Credit Card may be low at first, Capital One will automatically review your account and consider a credit line increase in as little as six months.
If you already have a strong credit score, you may want to consider the standard Capital One Quicksilver Rewards Credit Card instead. Youll earn the same 1.5% cash back rewards rate, but forgo the annual fee and qualify for a $200 cash bonus after spending $500 within three months of account opening.
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Ways To Help Strengthen Credit Scores To Buy A House
If your credit scores need work before you buy a house, consider these ways to help improve your scores:
- Make on-time payments. FICO and VantageScore both say your track record of making on-time paymentsâyour payment historyâcan be a significant factor in determining your credit rating. You could use email reminders or calendar alerts to remind yourself. And setting up automatic payments can ensure you donât miss a payment due date.
- Pay more than the minimum. Making only your comes with a cost: interest charges. And interest can add up and cost you more money in the long run. Interest can even make it harder to pay off debt. So consider this from the CFPB: âPaying off your balance each month can help you get the best scores.â
- Keep your balances low. The CFPB recommends that you not spend more than 30% of your available credit. A low âa measure of how much of your available credit youâre usingâcould be a sign that youâre using your credit responsibly and not overspending. And that could help you improve your score.
- Apply only for the credit you need. As the CFPB explains, âCredit scoring formulas look at your recent credit activity as a signal of your need for credit. If you apply for a lot of credit over a short period of time, it may appear to lenders that your economic circumstances have changed negatively.â
How To Choose Credit Cards For Bad Credit
Getting a credit card may actually be one of your best opportunities to start improving your credit profile. Heres what to look for in cards designed for consumers with bad credit.
- Reporting on-time payment behavior. You should choose a card that reports to at least one of the three major credit bureaus: Equifax, Experian and TransUnionthough reporting to all three is ideal. With this reporting, consistent payments will show up on your credit report and can help improve your credit standing over time. Its even better if you choose a card that reports to all three credit bureaus.
- Light on fees. Most cards for bad credit come with punishing fees like a high annual fee without the benefits to back it up , account opening fees or even fees for requesting a higher credit limit. Aim for a card that seeks to minimize the out-of-pocket costs of simply owning the card.
- Ability to upgrade. Some secured cards will allow you to graduate to an unsecured card after several months of consistent on-time payments. Doing so means you wont have to open another whole new account once your credit has improved. It also negates the negative effect that opening a new credit line can have on your credit score, which otherwise threatens to undo some of your hard work.
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Can You Do A Balance Transfer With Bad Credit
If you have subprime credit, it can be challenging to qualify for a card with a 0% APR balance transfer offer or a lower interest rate than your current card. Typically, these types of cards are available to those with good or better credit. Balance transfers from another bank are a way for credit card issuers to take on new customers, but first the lender will evaluate the perceived level of risk in extending credit. If your credit score deems you too risky to an issuer, your balance transfer wont be approved.
If youre looking for help taming a high-interest credit card balance and your credit doesnt qualify you to transfer your balance to another card, consider a personal loan, which may have more favorable rates. You can also speak to a credit counselor who might be able to help you work through your options for improving credit and paying down your debt.
What To Do If You Dont Qualify For The Capital One Venture
If your credit score is still in the 600s, you might consider applying for the Capital One VentureOne Rewards Credit Card instead. You only need average credit for the VentureOne . It can be a better option if youve experienced these credit events:
- Defaulted on a loan in the past five years
- Owned a credit card or other credit for three years or less
The VentureOne earns 1.25x miles on every dollar spent and doesnt have an annual fee. Though, you can earn 5x miles on hotels and rental cars booked through Capital One Travel, where youll get Capital Ones best prices on thousands of trip options.
Although you wont be earning as many miles per dollar, you can still own a Venture product and build your credit history.
Once your score goes above the 700 range, you can consider upgrading to the Venture Card and begin earning 2x miles on every dollar spent.
Related: Capital One Venture vs VentureOne Review
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Whats A Good Credit Score Range
A good credit-score range depends on where a score comes from, who calculates the credit score and whoâs judging it. Itâs important to remember that lenders set their own and standards to determine . That means that what FICO, VantageScore or anyone else considers good may not be the same.
However, there are some general guidelines for how being within a score range can impact your choices:
- A poor to fair score means you may find it difficult to qualify for many credit cards or loans. You might need to start with a secured credit card or credit-builder loan to build or rebuild your credit. And if you do qualify for an account, you may have to pay high fees and interest rates if you don’t pay your balance in full each month.
- A fair to good score means you may be able to qualify for more options, but you wonât necessarily receive the best rates or terms. You also might find you can qualify for a traditional unsecured but have a harder time qualifying for a premium card.
- A very good or excellent score means you may be able to qualify for the best products with the lowest advertised rates. While creditors consider other factors too when determining your eligibility and rates, your credit score probably wonât be holding you back.
Whatâs a Good FICO Credit Score Range?
FICO scores that range between 670 and 739 qualify as good scores. Scores in that range are near or slightly above the U.S. average. In total, FICO breaks its scores into five categories:
What Should I Look For In A Credit Card For Bad Credit
If you have bad credit, getting a credit card can be an opportunity to improve your credit profile. One characteristic youll want in your credit card is that the issuer reports on-time payment behavior to the major credit bureausEquifax, Experian and TransUnionand ideally all three of them.
If possible, youll also want to avoid cards with high annual fees and other charges like account opening fees. Finally, it can be a benefit to choose a card that will allow you to graduate to an unsecured card after several months of good payment behavior so you wont have to open another account once your credit has improved.
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What To Do If Youre Denied For The Capital One Platinum Credit Card
While the Capital One Platinum Credit Card is widely available to even those with poor credit, theres no guarantee youll be approved. If you find that your application for the Platinum card has been denied, you have several options:
- First, of course, is to look at why you were denied. If it was due to your credit score, you can take some steps to ensure your score is as high as it can be. Get a copy of your credit report from all three reporting bureaus and review them for accuracy. Dispute any entries that are not yours, and any inconsistencies in the report.
- If you were turned down due to your income not being high enough, there are some things you should know about reporting annual income on a credit card application. Thanks to the CARD Act of 2009, you are legally able to claim any amounts you have access to in the household, including income of a spouse or partner, as well as distributions, allowances, and gifts as annual net income.
- Other reasons for denial include delinquencies, collections, write-offs, and other negative credit report entries. While there isnt much to do about most of these except wait them out if they are accurate, you can offset their negative effects to your credit score by building good credit entries moving forward. This is where getting a secured credit card may help, through responsible use and making on-time payments.
What Is A Credit Rating
You may hear the words ‘credit rating’ and ‘credit score’ used to describe the same thing. Your CreditWise credit score is TransUnion’s numerical interpretation of your creditworthiness and is calculated based on a complex combination of all the information TransUnion holds on your credit report over a 6-year period. Your CreditWise credit rating is TransUnions interpretation of how well you’re doing. For example, ‘good’ or ‘excellent’. Generally speaking, the higher your credit score, and the better your credit rating, the more likely you are to be accepted for the best credit deals and interest rates.
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What Credit Score Is Needed For The Capital One Venture X
According to Capital Ones website, potential cardholders need an excellent credit score to qualify for the Capital One Venture X.
This means your FICO score needs to be at least 800 for Capital One to approve you for the card.
Thats a steep requirement. According to Experian data, the average FICO score in the U.S. was 711 in 2020. Keeping that in mind, one could assume most Americans wouldnt qualify for the Capital One Venture X card.
However, its important to remember that while your credit score is a crucial factor, its not the only one lenders consider when reviewing your credit card application.
An issuer can look at your overall credit history, your debt-to-income ratio and other data to evaluate the risk of approving you. Plus, your existing relationship with the bank might sometimes play a role.
For example, some of our staff who have been banking with Capital One for years were able to get the Capital One Venture X with good credit.
That said, no situation is the same. Its always best to ensure you meet the issuers advertised credit requirements to decrease the risk of card application denial.
How To Get A Secured Credit Card With Bad Credit
A secured credit card is typically easier to get for those with bad credit than an unsecured credit card with decent terms. Each is different and comes with its own minimum and maximum credit limits, typically requiring a minimum opening deposit between a few hundred and a few thousand dollars. .
Secured cards are offered by nearly all major issuing banks and some smaller ones. If you know already what bank or other lender youre interested in using, secured cards are most easily pursued through the issuers website. We recommend comparing at least several different options online and checking out other trusted resources for recommendations or general advice, such as our guide to the best secured credit cards.
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What Is The Easiest Credit Card To Get With Bad Credit
The easiest card for a subprime borrower will be either a secured credit card or an unsecured card marketed to those with bad credit. If you have the money on hand for a secured cards deposit collateral, this will likely be the easiest, safest-for-your-credit and most straightforward option.
Theres a relatively low bar for approval with secured cards and the collateral mitigates risk for the issuer, meaning you can even find secured cards with rewards. If coming up with the money upfront is unachievable, reconsider getting a card if at all possible, an unsecured card designed for subprime lenders will be the most accessible option.
Lenders Can Check Your Credit Scores When You Apply For A Personal Loan
May 13, 2021 |9 min read
Ever thought about applying for a personal loan? Personal loans can sometimes be useful for making big purchases or consolidating high-interest debts. Before you take that step, it may help to understand how your credit scores could affect your loan application.
While there might not be a minimum credit score required, your credit scores can really affect your chances for approval. Thatâs according to the Consumer Financial Protection Bureau . Many popular credit scores range from 300 to 850. And when it comes to approvals, the CFPB says the higher the better. Keep reading to learn why.
Before you dig into the details of personal loans, it may help to understand some basics first. While definitions can vary, personal loans generally refer to a kind of small loan that borrowers can spend as they see fit. Many personal loans are unsecuredâthat means you donât have to put down money or collateral first to be approved.
Your credit scores are just one of the factors that could impact your ability to get a personal loan. In the end, the decision is ultimately up to the lender.
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How Do I Check My Credit Scores
If you want to check your credit score, you can use . The tool can show you your VantageScoreÂ® 3.0 credit score, among many other helpful features. Best of all, using CreditWise wonât hurt your credit score, and itâs free for everyone. And at AnnualCreditReport.com, you can get free copies of your credit reports from each of the three major credit bureaus.
Whether your credit score is considered for a student loan or not, doing some homework could help set you up for success. And remember, student loans may not be your only option. Grants, scholarships and other forms of student aid could also be available.
*United Income became Capital One Investing in 2021.
Learn more about Capital Oneâs response to COVID-19 and resources available to customers. For information about COVID-19, head over to the Centers for Disease Control and Prevention.
Government and private relief efforts vary by location and may have changed since this article was published. Consult a financial adviser or the relevant government agencies and private lenders for the most current information.
We hope you found this helpful. Our content is not intended to provide legal, investment or financial advice or to indicate that a particular Capital One product or service is available or right for you. For specific advice about your unique circumstances, consider talking with a qualified professional.