Credit Tips: AmEx Secured Optima Credit Card Warning

Written by carnold
Posted On: February 1, 2006

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Posted: Thu Jan 13, 2005 2:25 pm
Post subject: AmEx Secured Optima Credit Card Warning

Shelly Larkin
Date: 6/7/2000 2:59 pm CDT

After reading a news article that stated that AMEX has not been reporting to the credit agencies I called their customer service number 1-800-628-2244. The rep assured me that AMEX reports (hmmm.. I don’t know about that). The rep told me to call 954-503-3787 and speak with AMEX’s “credit bureau dept”. I did and they told me that AMEX does report for all cards EXCEPT the Secured Optima! She said that the Secured Optima was designed only to establish a history with AMEX and therefore AMEX DOES NOT REPORT SECURED OPTIMA accounts to the credit agencies. She also said that if the account is maintained in good condition a regular account could be offered. One problem…she did not know how long the secured account had to be maintained! Could take years! So if you are planning to use this card to build credit history… IT WONT HAPPEN!

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Posted: Thu Jan 13, 2005 2:25 pm
Post subject: AmEx Secured Optima Credit Card Warning

matthew2582
Date: 6/7/2000 3:45 pm CDT

Other sources confirm what you say. My question would be - which secured cards DO report to credit bureaus ?

There seems to be some differing opinions out there ! If you get any info - please email me

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Posted: Thu Jan 13, 2005 2:26 pm
Post subject: AmEx Secured Optima Credit Card Warning

Eugene Skorodinsky
Date: 6/8/2000 0:51 am CDT

matthew2582 wrote:
——————————-
> My question would be - which secured cards DO report to
> credit bureaus ?

Why don’t you ask the issuer whose secured offer you like? They will be surprised to hear the question, either because the reps are dumb, or because they are never asked this question. Most will just put you on hold and ask their supervisor what the heck you mean by “credit bureau” (I am not joking here, that’s what happens). Bottomline is, they will tell you, and they probably won’t lie, so you get the info you need, firsthand. Ask them not only whether they report, but also when they start reporting (some banks start after a year or even 18 months). A good idea is to call them twice with about 9 hours difference, to get the answer from two reps or two supervisors.

I think whether an issuer reports secured card activity is the most important for building credit (and why are you getting a secured card if not for this?).

When after 10 months of responsible use of my secured card the issuer (HSBC) declined me for an unsecured card with some lame excuses (they just wanted to hold on to my money, I guess), I just took two of the pre-approved great offers I had plenty of by that time, and closed the secured account. Had they not been reporting, I would not have been able to get my cards.

I know that HSBC does report regularly (they start after three months from opening the account). They suck in many other things, though. They consistently lie about how soon one can qualify for an unsecured card from them (don’t believe if they say you can qualify after 6 months - you won’t, it’s at least a year with them). Tellers don’t know how long it takes for a cash payment to appear on the account (give me a break, how do they hire those people?) A supervisor yelled at me in a branch for no reason…

I did care then but I don’t anymore. They did what they were supposed to do for me - help me to be noticed by other banks.

So, despite the bank is a “C” overall, I’d recommend it for building credit. Just call before and check whether they still report.

Sorry for a long answer.

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Posted: Thu Jan 13, 2005 2:26 pm
Post subject: AmEx Secured Optima Credit Card Warning

Board Monitor
Date: 6/9/2000 2:00 am CDT

Thanks to all for their posts! We have placed a warning on the “Poor Credit” section of the site due to your feedback. This is, without a doubt, a little known fact and we want to “get the word out”. The terms of the AmEx card are wonderful, but the fact that the card doesn’t report to any credit bureau is a major limitation. As far as we know, all the other cards featured in this section of our site do report to the credit bureaus. If anyone discovers otherwise, please let us know.

Thanks again!

Regards,
Jackie Hughes
Board Monitor
CardRatings.org

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Posted: Thu Jan 13, 2005 2:27 pm
Post subject: AmEx Secured Optima Credit Card Warning

Keith
Date: 7/3/2000 9:40 am CDT

Who is HSBC?

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Posted: Thu Jan 13, 2005 2:28 pm
Post subject: AmEx Secured Optima Credit Card Warning

WW
Date: 6/10/2000 9:56 am CDT

I’ve been researching for a long time. I’ve been trying to determine which is the best secured card. Here are some helpful hints:

…if the issuer says “rebuild/establish credit with us”..they don’t report to the agencies!

….if they report to the agencies they will say…”we report monthly to major agencies…

you want a secured card that reports!!!

I have verified that Household, Orchard, and BankOne all report secured cards to the agencies.

I have verified that AMEX, CitiBank, and Wells Fargo DO NOT report secured card activity. These cards were designed only to build credit with the issuer!

The APR on most bank secured cards are about 17%-19% and most have a 25 day grace period. If APR is higher than 20% or the grace period is shorter than 25, DO NOT APPLY!

Secured cards shouldn’t ask for an application fee! If they do, DO NOT APPLY!

Annual fees on secured cards shouldn’t be no more than $50.00. If it is DO NOT APPLY!

The best deal on a secured card is with a CREDIT UNION! The APR is usually less than 15%! I even saw one with an APR of 7.9%!! There is a credit union league in most states and they have a web site that lists all credit unions. I live in Texas and the league here is www.tcul.com. I called them and they help me identify which CU I could join. We identified Communicators CU and the APR is 15%. The drawback to having a CU card is that they do not provide customer service after 4:00pm and none on weekends/holidays. However, they have long grace periods…minimal fees…and they allow grace when you exceed your limit or are late with a payment….and they report to the agencies.

Finally be aware that some secured card issuers report your account as secured! I recently learned this! I have not identified which do and which don’t.

Which ever one you choose, get their policy in writing. YOU WANT ONE THAT REPORTS MONTHLY AND DOES NOT IDENTIFY YOUR ACCOUNT AS SECURED!

GOOD LUCK!

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Posted: Thu Jan 13, 2005 2:28 pm
Post subject: AmEx Secured Optima Credit Card Warning

Eugene Skorodinsky
Date: 6/12/2000 3:54 am CDT

WW wrote:
——————————-
> ….if they report to the agencies they will say…
> “we report monthly to major agencies…

Not necessarily. HSBC does not say that explicitly but they do report. You’d better ask in every case. Sometimes that’s the only way to find out.

> DO NOT APPLY!
> If APR is higher than 20%
- That is if you are going to carry balance.

> or the grace period is shorter than 25 days
- That is if you aren’t.

> Annual fees on secured cards shouldn’t be no more than
> $50.00. If it is DO NOT APPLY!

Maybe that is right in your case, but not necessarily in everybody else’s. I take it that if different cards exist, some people can get only cards with tripple digit annual fees and security deposits twice the credit lines.
I’d say, START with something bellow $50, then be prepared to pay more if they refuse. Just don’t try too hard, every application lowers the chance of getting the next card.