Jackie Lavielle
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Ideal credit profile
Ideal credit profile
IDEAL CREDIT PROFILE CRITERIA BEFORE APPLYING
For both lean setup and maximizers, these are the credit criteria to consider before applying for your first personal card:
Payment History:
- Ensure no late payments and maintain a 100% payment history.
Utilization:
- Keep the utilization of each individual revolving account between 1-6% maximum.
Debt-to-Income Ratio (DTI):
- Aim for a DTI below 35%.
Length of Credit History:
- Have at least 1 year of average age reporting on your credit history.
- You can supplement this with Authorized User (AU) accounts.
Inquiries:
- Keep the number of inquiries below 3 in the past 6 months per bureau.
- For best results, limit inquiries to 3 or less in the past 12 months.
Credit Mix:
- Maintain at least 2 installment accounts, each being 4 months old.
- Have at least 1 revolving account, which can also be an AU account.
Derogatory Accounts:
- Avoid any derogatory accounts such as collections, charge-offs, or bankruptcy.
SPECIFICALLY FOR THE STARTER SEQUENCE:
Before going for premium credit cards like CSP, Amex Gold, BILT, etc., it is recommended to have the following:
Credit History:
- Have at least 1 year of credit history.
- At least 4-6 month-old primary accounts (installments) and the remaining age can be boosted by AU accounts.
Banking Relationships:
- Maintain 1 month of checking account history with Chase Bank.
- Have 1 month with Amex High Yield Savings Account.
- Maintain 1 month with Navy Federal Checking + Savings.
- Wells Fargo personal checking account could also be helpful for BILT.
馃搱 MAXIMIZERS:
When it comes to business funding, consider the following criteria:
Primary Credit History:
- Aim for 1+ year of primary average age on your credit report, even without help from authorized users.
Primary Credit Cards:
- Have at least 1 primary credit card that is 1 year old or more.
- Maintain at least 1 primary credit card with a limit of $5,000 or more, and at least 6 months old.
Data Mining:
- Consider doing data mining with each specific bank you want to get approvals with, if recommended.
AFTER YOUR FIRST PERSONAL CARD SEQUENCE:
For any future sequences, the ideal credit criteria would be as follows:
Payment History:
- Maintain a 100% payment history.
- If less than 100%, try to repair or have no more than 1 late payment in the past 6 months.
Utilization:
- Keep the utilization of each individual account between 1-6% maximum.
Length of Credit History:
- Aim for 1+ year of average age reporting on your credit history.
- You can supplement this with AU accounts.
Inquiries:
- Limit the number of inquiries to 3 or less in the past 6 months per bureau.
- For best results, keep the inquiries to 3 or less in the past 12 months.
Credit Mix:
- Maintain at least 2 installment accounts.
- Have at least 3 revolving primary accounts, each being 6+ months old.
- Ensure that the limits on these accounts are between $5,000 and $10,000.
Other Considerations:
- Build relationships with banks that you need a relationship with to apply.
- Be mindful of your 5-24 rule status and other bank rules based on personal preferences.
- Always double-check that secondary bureaus are not locked before applying for credit cards.
- Make sure you're getting the best SUB (Sign-Up Bonus).
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Financial literacy, How to repair your own credit
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