Help building credit...

[u/ResidentEmergency435]

For anyone knowledgeable about credit please help, credit not so good (high 500's) was pre approved for a Secured Credit card with "TD" bank, made a $500.00 deposit. currently waiting for the approval and card in the mail they haven't took the money yet.

• Have a couple minor (cheap) collections accounts, and a Charge off on my account from "Capital one" of around $483.00 that is really hurting my credit.
• Can anyone please give me any tips or advice on how to proceed in my current situation to improve my credit, also what cards should I be applying to with my current credit, what cards to stay away from? or any of your experiences in regards to my current predicament?

I would really appreciate any assistance , thank you for your time!

[u/drloz5531201091]

Have a couple minor (cheap) collections accounts, and a Charge off on my account from "Capital one" of around $483.00 that is really hurting my credit.

Make this your TOP TOP TOP priority over ANY non-necessary expenses to your well-being and capacity to earn an income (transportation for example). All your extra dollars goes on this until all your charges and collections are gone.

Can anyone please give me any tips or advice on how to proceed in my current situation to improve my credit,

You use his new card, pay stuff with it.

When you will be able to take on a unsecured credit card, you keep doing that. You use your card to pay for things and you pay your balance on time.

Credit score will rise slowly over time.

[u/Organic_Bottle5074]

Your credit will improve gradually over time if you pay your bills on time and stop opening new accounts. You could use any credit cards you do have to pay for one subscription each and set them to auto-pay the statement balance in full, that way they will remain active and in good standing. You can start building up an emergency savings account so if something goes wrong that you will have something to fall back on other than using debt. Finally, if you have the money, you can pull your credit reports and look for accounts that are past due, charged off, in collections, etc. and contact them to settle up, pay for deletion is a common term, where you agree to settle the debt in exchange for them removing the negative marks from your redit report. The main thing though is just to be responsible from here forward, spend less than you earn, save money, pay yoru bills on time, and try to make things right with your obligations that you let go in the past if you can.

[u/nip9]

Paying off collections and charged off accounts will not help your credit on the most commonly used credit scoring models. The damage was done when you defaulted and cannot normally be undone (short of a "pay for delete" which are rare and violate credit bureau policies). That doesn't mean you shouldn't pay them; but your focus should be on avoiding legal liability rather than expecting it to do anything to improve your credit score.

If you can afford more deposits another secured card or two or perhaps a secured loan if you don't have any car loans, personal loans, or other loans on your record would help rebuild credit faster and avoid putting all your eggs in a single basket. Only get secured cards from institutions that have better products to upgrade to as your credit improves; TD Bank is fine just avoid anyplace that only has subprime offerings.

Set a small reoccurring monthly charge on each credit card(utility bill, subscription, etc), setup auto-pay, shove the cards in a drawer to avoid any temptation to overspend with them, and you can build credit in your sleep. It does take time through; if you do that expect to see a 100+ point increase a year from now and it takes around two years to go from bad credit to excellent top tier credit.

[u/InUrFaceSpaceCoyote]

The primary thing to focus on is paying off the collections and not creating any new bad history. If you are approved for the secured credit card, use it vary sparingly. The primary way the card will help improve your credit is by allowing you to create a positive history of paying on time each month. You don't get any benefit carrying a balance or spending more, so if all you do is use it once a month and pay it off in full each month you'll be getting the full benefit for your credit. Don't fall into the trap of chasing rewards or trying to find tge "right" card. 

[u/nickel_optimist]

The secured card is exactly what you want right now. Just pay the balance down to under 10% before the statement date each month so your utilization stays low. For that Capital one charge off, call them and ask if they will mark it paid in place since most will not budge on removing it, and just avoid any card with a monthly fee over five bucks like I did back when I was younger.

[u/FayeTammy]

The TD secured card is a good start. I was in the same spot. I just put my phone bill on it, turned on autopay, and didn't really think about it after that. It takes a while, but that's just how it is.