Building Credit Basics

How to Get Approved for Your First Chase Credit Card

It's no secret that JPMorgan  Chase has some of the best credit cards out there for travel. If you're just starting out on your credit journey, then I recommend building a relationship with  Chase as soon as possible to start earning points.

Below is a general roadmap of how to get approved for your first  Chase credit card.

Phase 1: Apply for the  Chase Freedom Unlimited® or  Chase Freedom Flex℠

The  Chase Freedom cards are entry-level cards that earns 5% cash back on travel purchased through  Chase Ultimate Rewards and 3% on drugstore purchases and dining at restaurants. Save up the Ultimate Reward points to redeem for travel when you get a premium credit card.

There are a few scenarios:
    a) if approved for the  Chase Freedom Unlimited or  Chase Freedom Flex= move to Phase 3
    b) if no answer = move to Phase 1.5
    c) if rejected = move to Phase 2

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Phase 1.5: Call the backdoor number and talk to a credit analyst

If you don't automatically get rejected for a  Chase Freedom card, then call the backdoor number and talk to a credit analyst to explain your financial situation.

Chase Freedom Backdoor Number: 1-888-270-2127‬

a) if approved = move to Phase 3
b) if rejected = move to Phase 2

Phase 2: Apply for the Slate card

If you get rejected for the  Chase Freedom card, then try applying for the  Chase Slate card on the same day to combine hard inquiries. When you apply for the  Chase Freedom and  Chase Slate online on the same day, it should only be 1 inquiry. YMMV.    

The  Chase Slate card can be product changed to a  Chase Freedom card after a few months.

a) if approved = move to Phase 1 or Phase 3
b) if rejected = get 700+ score by getting a secured card or dramatically increase your credit score and have a credit history of at least 6-12 months. Wait another 3-6 months to apply again (Phase 1 or Phase 2)

Phase 3:  Chase Freedom Unlimited /  Chase Sapphire Preferred /  Chase Sapphire Reserve / Other  Chase Cards

After you build a relationship with  Chase via the  Chase Freedom Flex or  Chase Freedom Unlimited card, wait 3-9 months before applying for another  Chase card.

I usually recommend going for the Chase Trifecta, which consists of the  Chase Freedom Flex,  Chase Freedom Unlimited, and the  Chase Sapphire Reserve® or the  Chase Sapphire Preferred® Card.

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How to Get a Perfect 850 Credit Score: A Step-by-Step Guide

We recently published a post about why an 850 score doesn't matter, but ironically, the most common question we received was how to achieve an 850.

Today, we'll walk through all the variables that affect your credit score and how to optimize around it.

As a reminder, your credit score is based on 6 different factors:

If you haven't checked your credit score recently, Credit Karma is a free resource. A lot of credit card companies like American Express, Discover, and Citi offer free credit reports within your account portal.

The breakdown:

  • Utilization = 30%
  • Payment history and derogatory marks = 35%
  • Average age of accounts = 15%
  • Total accounts = 10%
  • Credit inquiries = 10%

To score an 850, you need to score excellent in each category.

Utilization

Stay in the 0-9% range. Let's say you have a credit card with a $1,000 credit limit, and your statement is at the end of the month. If you wait until the end of the month to pay it off, it affects your utilization.

A good way to lower utilization without changing your spending habits is to pay off your balance before the statement closes.

If you do pre-pay your balance, don't zero out your utilization. Leave a small balance to pay off when the statement closes to have a balance due to reflect in the payment history.

Pre-paying your cards may seem unnecessary, but I think it makes sense because you're aware of your spending habits.

If you are someone who carries a balance every month, look at your expenses and try to see what you can cut back on.

Payment History

You need a 100% to score "Excellent." Payment history is relatively straightforward: pay your bills on time. Payment history can be hard if you missed payments in the past. As long as you pay the minimum balance required for the credit card, you'll be okay for this category.

If you miss one payment, then it already brings down the payment score to "Good."

On time payments
_______________________ = Payment history
Total number of payments

The problem with having only one credit card is that missing one payment puts you in "poor payment history": 23 on time payments/24 total payments = 96% (Very poor).

This means that a mistake you made two years ago is going to impact you today if you have one card. Even in the third year, the missed payment will still impact you. Only after the third year does the credit score recover: 35 on time payments/36 total payments = 97% (Poor)

If you run through the situation with five cards instead of 1 card, it's more forgiving:

59 on time payments/60 total number of payments = 98% (Fair)

The main takeaway is not to miss any payments. If you do miss a payment, you can get more credit cards to offset the damage (pay them off in full).

A good way to make sure you don't miss any payments is to automate them. You can choose to pay the card off in full or pay the minimum.

Derogatory Marks

Defaulting on a credit card is an easy way to destroy your credit score, as well as any banking relationships. For example, if you default on a card from an issuer, you might not be able to receive any other products from them. They could also end their banking relationship with you as well.

Unlike payment history, this is easier to fix. You may be able to negotiate a payment plan with the bank to get back on track.

Average Age of Credit History, Total Accounts, and Credit Inquiries

Average age of accounts: the higher is better. You should aim for 9+ years to score "Excellent."

Total accounts: You need 21+ accounts to score "Excellent." If you have 20 cards and low utilization, you're seen as more responsible to the credit agencies. I do realize that 21+ cards sound ridiculous, but hey, I don't make up the rules.

Credit Inquiries: Specifically hard inquiries whenever you apply for a new credit card. When you rent a house, and they run a credit check, that's a soft inquiry. Applying for a credit card or a car loan is a hard inquiry because you're going to accumulate debt. The interesting thing about credit inquiries is they fall off your report after two years.

For example, if I apply for 20 credit cards in one year, that's 20 inquiries. After two years, they fall off like they weren't there in the first place.

These three factors work together. You can take an approach to take one step back to take ten steps forward in the future.

How to achieve a perfect 850 credit score

If you're going after the 850 (again, a perfect score doesn't matter), then you'll want to get 21 credit cards as soon as possible and wait. You'll take 21 inquiries right away, which will pull your credit score down for the next two years. After the two year mark, all the inquiries will fall off.

With your 21 credit cards, be sure you don't miss any payments. Utilization wouldn't matter because you can fix that in the future. Set the 21 credit cards aside for nine years to factor into the average age of accounts.

Starting at the 8-year mark, be sure your utilization is low. Most likely, you are a financially responsible person if you can get approved for 21 cards.

At the nine year mark, you'll have a low utilization, 100% payment history, 0 derogatory marks, 9+ average age of accounts, 21+ total accounts, and 0 inquiries. It's like baking an elaborate birthday cake that you have to wait nine years to eat.

The big question: What do you get for having an 850 credit score?
Answer: Nothing. You'll receive the same benefits and interest rates as someone with a 750 credit score.

YouTube Video

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How to Aggressively Increase Your Credit Score (Short Term Strategy)

One of the questions we get asked frequently is, “How can I increase my credit score?”

We have a lot of content about different credit cards and how to optimize them, so how do you increase your credit score in the short term to qualify for premium cards?

To increase your credit score, you have to understand what factors drive them.

What is your credit score?

We’re going to use a free resource, CreditKarma.com to check your credit score. Most services tell you what your score is, but they don’t show you which variables affect your score in detail.
If you’re not familiar with Credit Karma, they’re a tool that gives you your credit score for free. Are they legitimate? They’ve raised hundreds of millions of dollars from venture capital firms and have a valuation in the BILLIONS.

For a quick summary, this is how credit agencies grade you. Credit Karma conveniently shows you these things as well:

FACTORS THAT IMPACT YOUR CREDIT
  • Credit card utilization = total credit card balances / your total credit card limits
  • On-time payment percentage = your on-time payments / your total payments
  • Derogatory marks = open accounts in collections + negative public records marks
  • Age of credit = average age of all open credit accounts
  • Total accounts = open accounts + closed accounts
  • Credit inquiries = hard pulls (credit cards, some banks, and Comcast)

If you want to rapidly, and aggressively build your credit, you need to focus on the things you can control.

Also, you should make sure you focus on the high impact factors.

The three high impact areas are:

  1. Credit card utilization
  2. Payment history
  3. Derogatory marks

Credit Card Utilization

A lot of people choose to wait until their statements come to pay their bill. This makes sense because you don’t owe interest on it until after the payment due date, so why would you pay early? The simple reason is that your goal here is to increase your credit score drastically and a big factor is utilization.

Again, utilization is total credit card balance / total credit card limits. So if you have a $500 limit and you spend $200, you’re at 40% utilization. That’s in the fair zone. Not bad per say, but not great. This is especially true if you have the money to pay for it anyways.

My strategy is to pay off your credit card every few days; this ensures that utilization stays at the excellent range (you can keep the balance at $1 if you’re worried that they won’t report your $0 balance to the credit agencies). Let’s say my balance after a week is $100 from groceries and lunches. I’ll pay that off BEFORE my statement even comes to keep my utilization near 0%. This has the dual benefit of ensuring that your payment history category doesn’t get screwed up.

This strategy alone helped my credit score skyrocket from 0 to 760, all in less than a year.

Payment History

This seems pretty straightforward but PAY YOUR BILLS. Even one missed payment can negatively affect your credit for a long time. For example, if you have one card with six months of history (you’re 6/6!). If you miss a payment in month 7, you’ll be 6/7. Or 85.7%. This instantly puts you in the “very poor” category for a high impact category and can make it extremely difficult to establish your credit.

Ways around this are to set up auto pay, set calendar reminders to pay your bills, or to pre-pay. I would recommend pre-paying to remove this risk (more on this below).

If you have missed a payment, I would contact your bank to see if you can get it removed. Some banks will do it as a courtesy once they get paid. If you get a hit, you have nothing to lose.

Derogatory Marks

To reiterate the first sentence from payment history… PAY YOUR BILLS.

If you’re an international, this shouldn’t be a problem area for you since you wouldn’t have had the chance to default on a loan previously.

If you’re working to improve your credit, I would reach out to the bank and repay the loans. If you go the bankruptcy route, it takes seven years for the derogatory marks to disappear. Even then, you’ll likely have trouble getting another credit card or loan from that financial institution. It makes sense though, if you screwed Chase / Bank of America / whoever, out of $5,000, they have the right to not lend to you in the future.

Age of Credit

You have little control over this factor other than just waiting it out. If you’re an international, I would recommend that you keep yourself at one card because of Chase’s rules on credit cards.

Total Accounts

Total accounts are, again, a category you can’t control, and I wouldn’t worry too much about it.

Interestingly enough, a lot of people get this category confused. The average person assumes that someone with a lot of credit cards must have money troubles. While that might be true for some individuals, that’s not how credit agencies (and finance savvy individuals) view it. Instead, the idea is that the more credit cards you have, the better you must be at managing money. To get into the good category, you need 11–20 credit products.

Credit Inquiries

I would not be overly worried about this category since it’s part of the process. The primary concern is applying for cards you know you’ll get rejected for and rack up a ton of inquiries for no reason.

I’ve seen people who keep applying for premium credit products like the Chase Sapphire Reserve and get rejected. After asking them about what their credit looks like, they tell me they’re new to America and don’t have a credit file. These end up being pointless credit hits.

Tying It All Together

The secret to aggressively building your credit is simple: pay your credit cards off in full and keep the balance near zero. If you're new to credit, check out our post about how to choose a secured credit card.

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Sable ONE Secured Card Review (2022)
Credit Builders

Sable ONE Secured Card Review (2022)

If you want to build your credit or do not have a past credit history, the Secured Sable ONE Credit Card is a good option for you. With this card, you'll be able to see your credit history in real-time and have every purchase count toward your credit score. Plus, you can already start building your credit history while enjoying premium perks. Continue reading to find out more.

Key Features

Annual Fee: $0

Welcome Bonus: Get a 2X cash bonus (dollar-to-dollar match) on all cash back at the end of your first year. 

Spend Multipliers:

  • Earn 2% cash back on every purchase you make at Uber, Uber Eats, Amazon, Whole Foods, Spotify, Netflix, and Hulu.
  • Earn unlimited 1% cashback on everything else

No SSN required for non-US residents.

No credit check or U.S. credit history required. 

Get unsecured in as fast  as 4 months

Zero annual or hidden fees, no minimum deposits.

Other Perks:

  • Cellphone Damage Protection
  • Rental Car Insurance
  • Zero Liability Policy
  • Price Protection
  • Purchase Assurance
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Sable ONE Secured Credit Card: Benefits

  • New Double Cash Bonus: Get a dollar-for-dollar match on the cash back you earn throughout your first year. If you use your card regularly during your first year of membership, you might wind up with a lot of cashback points.
  • Earn cash back: Earn 2% cash back on the things you actually buy at Uber, Uber Eats, Amazon, Whole Foods, Spotify, Netflix, and Hulu; plus, 1% cash back on all other purchases. Given that most secured credit cards do not offer purchase rewards, this is a unique and valuable perk.
  • No annual fee, No Late Payment fee: This card has no annual fee and no late payment fee, making it easy to decide whether it's worth keeping year after year.
  • Build credit: Sable credit activity reports to all three major credit bureaus, including Equifax, Experian, and TransUnion, will appear on your credit record.
  • No SSN needed: If you are not a U.S. citizen and do not have a Social Security number (SSN), you can apply using your U.S. visa and passport. Citizens of the United States must apply with their Social Security numbers.
  • No credit check: Sable does not need a credit check to apply, thus there will be no impact on your credit score throughout the application process.
  • Graduate to unsecured: Cardholders can graduate from a secured credit card to an unsecured credit card in as little as four months by following the Sable "Path to Unsecured Credit" program. Sable will evaluate factors such as your monthly active consumption, on-time payment history, and outstanding balance while determining your eligibility to graduate.
  • Cellphone Damage Protection: If you pay your monthly cell phone bill using this card, you will receive coverage for your phone against damage or theft.
  • Rental Car Insurance: Through Sable’s Master Rental Insurance, you’ll receive car rental coverage against damage or theft.
  • Zero Liability Policy: Sable ensures that you will not be held liable if unauthorized purchases are made on your credit cards.
  • Price protection: If you purchase an item and then discover it somewhere else at a lower price within a certain length of time, you can get the difference in price back.
  • Other Sable services: You can apply for other Sable products, such as the Sable bank account and debit card, in addition to the Sable Secured Credit Card. All of these goods are accessible and used via the Sable app, which is available for both iOS and Android devices.

Sable ONE Secured Credit Card: Drawbacks

  • No balance transfers: Balance transfers are not available with the Sable Credit Card. Most secured credit cards, however, do not have this feature.
  • Limited reward categories: Sable currently is app-only and has not yet provided web-based services.
  • Foreign transaction fees: 2%

Who Should Get This Card?

  • Individuals who are new to credit
  • Those who don’t wish to pay an annual fee.
  • Resident in the United States but not a citizen
  • Those who prefer digital banking over in-branch banking
  • People do not want a credit check to have an impact on their credit score.

How Does Sable Work?

The Sable One Secured Card, like any other secured credit card, requires a cash deposit to open. That deposit serves as collateral for the credit line – and the credit limit. Unlike other secured cards, Sable does not need a minimum deposit and has a high-end, $10,000 maximum deposit, giving applicants considerable flexibility in building credit while maintaining a credit limit that meets their needs.

Each Sable ONE credit card automatically comes with a bank account. Sable accounts are accessed using the Sable mobile app (available through the Apple App Store and Google Play Store). Once a member, simply go to the Cards page of the Sable app and choose the Sable One Card, then click 'Increase credit limit.'

After adding the funds, the credit line is secured. Cardholders can continue to deposit cash later to increase their credit limit if desired– up to the $10,000 maximum.

FAQs

Is Sable a real credit card?

The Sable Secured Credit Card is a legitimate credit card issued by Sable in collaboration with Coastal Community Bank. This card does not have strict credit requirements, and you do not need a Social Security number to apply if you are not a US resident. It might help you build credit while also rewarding you for purchases.

Is the Sable Credit Card safe?

The Sable Credit Card includes all of the protections you'd expect from a reputable card issuer. This includes zero liability protection, which means you're not responsible for unauthorized purchases made with your card. 

Furthermore, the Sable mobile app allows you to freeze and unfreeze your physical or virtual card, which may be useful if the card is lost or stolen. Your Sable account is FDIC-insured up to $250,000 per depositor through Coastal Community Bank, Member FDIC.

Is Sable a real bank?

Sable Bank Account is provided by Sable Money Inc, a nonbank financial services company launched in 2019 and headquartered in New York, NY. Sable Bank Account is available in all 50 states (and Washington, DC). Sable Bank Account also provides premium rewards on your purchases (see terms and conditions for details).

What bank does the Sable Credit Card use?

Banking services are provided by Sable in collaboration with Coastal Community Bank. A secured credit card, checking account, and debit card are all part of this program. The Federal Deposit Insurance Corporation (FDIC) insures Coastal Community bank accounts up to $250,000.

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