Credit Builder Cards Reality
Credit Repair's New Hope
It seemed almost too good to be true, and perhaps that's our fault for getting our hopes up, but all the new rave seems to be about raising our credit scores by investing in a debit-styled credit card. In theory, the idea makes sense. I put aside a few thousand dollars every month. I spend those few thousand before the month ends. The amount I put aside pays off what I spent. The credit card reports to the three major agencies that I have a zero balance and an available credit equal to the amount I paid them before I spent it.
Right? That makes sense to me. And if you're a normal person, then that seems normal to you to. Now, I know some people put a total of ten or twenty dollars into their credit builder account, thinking that tiny amount would have some sort of impact on their scores. It will not. In order to see real changes, a consumer has to invest real values.
I personally did not hear great things about some of the credit building cards out there, but I figured this was my regular bank, what value would it be to them to go through all this and not improve my credit? Makes sense. So, in the first month, I spent roughly $6,000 of my total monies through the credit builder credit card, transferring funds from savings and checkings accounts with my hopes still swimming in the clouds.
The next month came around, and I close to doubled that amount, except for the $10k limit imposed on the new card, but still no changes in my credit reports. On a side note, I had a used car dealer wreck my credit about two years ago by shopping for loans across the whole East Coast. So, the timing of those hard inquiries dropping off confused me, and I falsely believed the credit builder raised my credit score 170 points. I was thrilled. But something didn't make sense. The credit account didn't show up on my report yet.
I waited and waited, and sure enough, finally, my trusted bank finally kept their promise and helped repair my credit with this credit card shenanigan. With $6k spent, every penny paid off before the end of the month, and another $10k of my own money, not credit from the bank, but my own savings and checkings, these fools reported I had a $1600 balance on a new credit card with no set maximum, so there's no way to calculate percent of debt, and my credit scores dropped an average of twenty or thirty points that day.
I'm not sure if this bank understands the concept of customer satisfaction, because I can't imagine anybody anywhere would be comfortable with losing a five figure income per month over something that this bank didn't even benefit from. The money was already in my account making close to zero interest, so why report to the credit bureaus that I have a balance at the end of the month, which I don't have, report no credit limit for the account, so whatever the balance is happens to also be 100% spending and 100% debt, and I owe these people nothing.
Now! In terms of dealing with credit cards harassing you about paying your bills, this is just nonsense. We are entering the close of the second month of this credit building account I'm suffering from, and if the same thing happens again, then we honestly may have a class action suit on our hands, because those were some pretty hefty promises to rebuild our credit only to make our credit scores even worse.
And it's not like it's even complicated math. I paid off my balance in full; by virtue of the structure of the account, all balances are paid off in full before the monies are even spent. To report a large balance falsely to my credit bureaus is one hell of an accounting error. Are you telling me my banking representatives who came up with this idea didn't foresee that their crooked calculations would drop my credit scores even lower? Or were they too busy scheming on profiting off a 0.05% interest difference by putting my savings into a credit builder account that does the exact opposite of what its name suggests.
The worst part is this month, I've maxed out the spending limit on the credit builder account, and my wife is transferring over her entire bank balances to help improve my credit so we can keep moving forward, but another huge setback on my score, and this credit building card with its promises of raising credit scores is nothing more than a poorly thought out plan to keep the poor investing their last dollar in dreams that just get dashed away the next day.
Needless to say, this credit building account I was so graciously offered by my generous bank reflects poorly on me for trusting people with my money who can't even figure out how to effectively implement a credit account with a low balance. Not rocket science people. I don't need to give someone $3000 in advance for them to go and report to the credit bureaus a new credit card with a $3000 limit and maxed out the first month. For all intents and purposes, this is the results of the actions of my bank in the first month.
Perhaps next month will be better by some miracle. Perhaps, there's some advanced economic aftershock I was unaware of when my bank blatantly rips me off and worsens my life slightly in the process. I'm starting to question the value of putting my money in a bank if the return has dwindled below the break even point, and now it's just costing me more than if I never used a bank in the first place. That's one step towards a revolution: even the rich with all their money and riches still need the lower classes to put their money in banks so the interest rates can make them richer and us poorer. I say enough's enough. Either start offering a return on our investments, like back in the 80s and 90s when savings accounts offered 7% interest or more, or stop forcing us to deposit our hard earned money into institutions we can't even trust to keep our money safe.
I feel like I've been hit on the head like in a cartoon, and i'm dancing around with little miniature dolls spinning around my head, but nobody notices, because the same thing is happening to everybody else. So, we're all just going along with strangers ripping us off by promising one thing and delivering another, and once again, we all stand idle and at worst, hold a march or parade when children die, but the way this economy is headed, I'd say liberty is already dead, and now the vultures are collecting the remaining scraps from our souls.
Maybe I'm overreacting. Maybe there's a perfectly good explanation why the credit builder reflected a balance that I didn't owe. Maybe everything is perfect and hunky dorey, and it will all work itself out if we just give it some time and exhibit some patience. Me, personally, I'm not the type to sit around and wait for someone to reverse screw after it's been turned in. Needless to say, the only way to fix your credit is to pay off debts and don't accumulate new debts. And in the case of the new credit builder cards, don't even accumulate good standing, because no matter what they say or how they explain it, my credit score dropped 30 points the first month from them.
I hope young people out there trying to improve their credit learn something from this. It's better to get a secured visa from an actual credit card company than it is to trust your own bank with large investments expecting them to raise your credit score, because credit card companies are much more heavily regulated and can't get away with half the nonsense that banks do. Remember the bail out just around a decade ago? The rich folk lost all their money, so the government gave them all of our money we had saved in the banks to bail them out. I don't remember voting on that decision as a democracy.
The path to global peace begins with the sacrifice of all those who refuse to continue living another second without the promise of global peace in their children's futures, and the cost of a utopian society is directly correlated to the losses suffered before such a peace is established. We need to return the power to the people with a true democratic voting process of majority rules across the nation. That would be the first step to fixing all these other issues, like everybody lying all the time.
Just to reiterate: the first step is to restore a true democratic voting process among the citizens of our country. No more politicians behind closed doors, we all get on our laptops or tablets, and we all vote together on all decisions affecting us. That is democracy. Anything else hypocrisy.