topic Re: Starting out! in Credit Cards

Starting out!

Anonymous — Sat, 14 Jul 2012 01:38:37 GMT

Hello Everyone!

I am posting for the first time on this forum. I have been reading several posts that are actually insightful and note-worthy! I have just turned 18 and honestly I have learned a lot just by reading a lot of the material provided by myFico and the wonderful poster community. And I took a class offered by our local bank branch on credit responsibility >.<

I know what you are thinking 18 year old and credit card. I remember being 18.. well you are probably right so I am seeking guidance and assistance as I begin my journey speaking in long-term I seek to achieve a high 750FICO. I just started college and I am taking out DIRECT loans unsub and sub. (6.4% and 3.8%) and short-termI am looking to stay off-campus next year. I work around 32-38 hours a week and have worked for about 3 and a half years now.

I wish to establish credit in ways other than paying off accrued interest on my unsubs ( 6.4%) because I have money set aside for that already. I have read some great reviews about the Capital One Journey Student's Credit Card.

Any one have any suggestions or rants about me being an 18 year old that just wants to go app-crazy?

Neftali

Re: Starting out!

Anonymous — Sat, 14 Jul 2012 02:09:21 GMT

Also I have common abbreviations thread open in another tab however some terms are not listed such as : gardening and prime cards.

Re: Starting out!

jsucool76 — Sat, 14 Jul 2012 02:24:16 GMT

Well, to help you out a little first:

Gardening - a cessation from applying for new lines of credit

Prime cards - cards from prime lenders (Amex, Chase, Discover etc.., NOT Cap1, Orchard, HSBC, )

If the bank you currently have a relationship with offers any student credit cards, I would suggest you go there first, if not, the top student cards I've read about here were the Citi forward Student card, and the discover more student card (if you apply, make sure you go to the actual student version, as there is non-student versions as well)

I too am an 18 year old college student (just began my 2nd year of school) and I had no luck getting any student cards, don't know why, just couldn't. I started off with the Cap1 Platinum MC.

Re: Starting out!

Anonymous — Sat, 14 Jul 2012 02:35:17 GMT

I appreciate the quick reply. Is the CL still 3k as listed on your signature? My bank does not offer any student offers they do however have a high rewards and high apr card and low apr no rewards card which I might be approved for the latter. I read about CITI I am leaning towards Discover and Capital One Does employment have to do with a credit decision ? What are some reasons you think you were not?

How has capital one been to you?

Re: Starting out!

jamie123 — Sat, 14 Jul 2012 02:36:23 GMT

You want to start your credit accumulation journey with the LONG term end result in mind.

Remember to ALWAYS pay in full each month and never carry more than a 9% balance if possible.

When you are done with your journey you only want 6 (Give or take a few. YMMV) REALLY good cards from these prime lenders:

CitiBank

AMEX

Chase

Barclays

Bank of America

Discover

Wells Fargo

These prime lenders will follow you around the world, wherever life takes you. With time and good behavior they will also give you MASSIVE credit lines.

And perhaps one card from the world's largest corporation:

Walmart

You get a free TU credit score every month and it seems most people on this forum have this card.

Most of the prime banks have "Student Edition" cards. It would probably be best if you started there.

Perhaps try applying for 2 student cards now, then wait 6 months and try for 2 more cards.

Re: Starting out!

jsucool76 — Sat, 14 Jul 2012 02:46:58 GMT

@Anonymous wrote:
I appreciate the quick reply. Is the CL still 3k as listed on your signature? My bank does not offer any student offers they do however have a high rewards and high apr card and low apr no rewards card which I might be approved for the latter. I read about CITI I am leaning towards Discover and Capital One Does employment have to do with a credit decision ? What are some reasons you think you were not?

How has capital one been to you?

Yeah, the limit is still 3k, I just got this card less than a month ago, it started as a platinum MC and got PCd to a cash rewards card. I have my credit steps which should mean a CLI after my 6th statement. Emplyment always has to do with the decision, because your income is your ability to repay your debts. (I however am unemployed but got a 3k limit) Remember, some banks will allow you to use your grants and scholarships in your income (Any Financial Aid from your university that you are not required to repay), so remember that if you recieve any.

And as far as not getting student cards, I really have no idea why. The reasons were always "lack of revolving credit accounts" which basically means "We can't give you credit, because you have no credit history" which I always found odd for student cards.

Re: Starting out!

Essence — Sat, 14 Jul 2012 02:47:27 GMT

If you aren't accepted for Any student cards, also check out the Capital One for Newcomers card.. Not the most impressive credit limit but it has no annual fee and offers rewards. I believe the plat card has an AF and does not offer rewards.

Re: Starting out!

jamie123 — Sat, 14 Jul 2012 02:47:56 GMT

Capital1 will not grow with you. Most people will max out their credit lines at $3000 to $3500. Their customer service is also not the greatest.

The problem with getting a prime card is your length of credit history. The prime banks usually like to see at least 1 to 2 years of good credit history on your report before granting credit. That's why you need to make sure you apply for their STUDENT EDITION cards. They are more lenient about length of credit history with those cards. They will also probably start you out with small credit lines because of your lack of adequate history and see how you handle that before increasing your credit line.

Re: Starting out!

trumpet-205 — Sat, 14 Jul 2012 02:51:32 GMT

I definitely recommend Capital One Journey Card. Sure it won't grow with you overtime, but it is the best way to establish credit history. Now days even if you are a student lenders aren't likely to issue you a card without some histories, with the exception of Capital One.

Re: Starting out!

jamie123 — Sat, 14 Jul 2012 02:53:42 GMT

You might want to try applying at 2 prime banks first and if you get rejected then try Cap1. Cap1 does seem to have much more lenient lending standards than the prime banks.

But really, you need to at least try the prime banks first.

Re: Starting out!

jsucool76 — Sat, 14 Jul 2012 02:55:23 GMT

@trumpet-205 wrote:
I definitely recommend Capital One Journey Card. Sure it won't grow with you overtime, but it is the best way to establish credit history. Now days even if you are a student lenders aren't likely to issue you a card without some histories, with the exception of Capital One.

+1 , Cap1 is notorious for their lack of CLIs, but they're also widely known for being the first ones to either a) accept people with no history, or b) give people a second chance after making mistakes. There really is no better place to start, plus the journey card earns rewards with no AF and it's probably the easiest student card to get, plus you will be put into the Credit Steps program which will give you a cli after 6 months.

Re: Starting out!

webhopper — Sat, 14 Jul 2012 03:17:40 GMT

I would app for discover student card. They are great and will treat you right. Eventually the card becomes.a.regular more card. You'll probably never realize when it morphs

Re: Starting out!

Anonymous — Sat, 14 Jul 2012 03:35:41 GMT

Awesome a wealth of tips there! I appreciate it. Well a couple more questions before I submit an application, will applying for any CC that has been mentioned here be a hard inq. I know a post mentioned I should apply for Discover and CITI first then try Capital One as last resort if I am not approved. Will the hard inq affect a decision also?

Also in addition, "Keep balances low (1-9% util) on credit cards and other revolving credit. High outstanding debt can affect a score." is a tip on a thread here Credit Score 101 what exactly does this mean? I plan on paying balance in full 1 week early. Is this what most people do?

Re: Starting out!

webhopper — Sat, 14 Jul 2012 03:35:35 GMT

How many inquiries.do you have? I think if you app in this order: discover; citi; cap1

I think you have a good chance to get 2 out.of 3

Re: Starting out!

jsucool76 — Sat, 14 Jul 2012 03:34:55 GMT

You can always assume that any credit card application will be a HP (or inquiry) on your credit report, there is very few exceptions to that rule. Inquiries do affect your applications for credit, however, if you have 0 now, then even if you apply for all 3, 3 isn't a whole lot, especially if they pull different reports. The reason that cap1 was suggested as the last app is because they have more lenient lending practices, so inquiries wouldn't be too much of an issue for them, whereas citi or discover might see a lot of inquiries and say no.

Re: Starting out!

Eschaton — Sat, 14 Jul 2012 03:35:02 GMT

I'm not too concerned about you being 18 and going after credit cards - if you found your way to this forum I am sure you will be very responsible with your credit cards. I don't know why there is this stigma with people saying credit cards are evil, I find that very few people I know got into heavy debt with them. I guess it's just the bad apples ruining it for everyone else.

I started with the Capital One Journey also with no credit history in 2010. They said the Card ACT made it impossible but somehow I slipped through the cracks. Like others have said, Capital One isn't for the long haul but they will help you get on your feet. I had mine for a year and went on the Freedom and Zync and now it's just sitting around.

I have faith you will do good with your cards, just make sure you allow sufficient time before seeking on to bigger and better things. Folks here, myself included, are pretty trigger happy Just get a card to get started and visit this forum often and you'll get a grasp of what you want in a year or two.

Best of luck to you!

Re: Starting out!

DaveSignal — Sat, 14 Jul 2012 03:39:20 GMT

"prime" refers to the credit ratings of the consumers that a card caters to. Capital One has cards for the prime market too.

Re: Starting out!

Anonymous — Sat, 14 Jul 2012 03:55:12 GMT

Okay thank you for the advice. I went ahead and applied for Citi and Discover. Insufficient credit history from Discover unfortunately :[ and Citi gave me this message instead of instant approval..

"Thank you Mod Cut. We have received your application and further processing is required at this time. We will contact you within a week via email regarding our decision. Thank you for requesting a Citi Forward® Card."

Anyone know if I can recon Discover? I don't think I want to do Capital One but I do like there cash back 1.25% since I plan to pay balances in full..

Please don't post personal information - MarineVietVet, myFICO moderator

Re: Starting out!

Anonymous — Sat, 14 Jul 2012 03:52:52 GMT

No hard inqs but I just turned 18 so I have 2 right now. Since I applied for Discover and CITI.

Re: Starting out!

jsucool76 — Sat, 14 Jul 2012 03:53:26 GMT

You can always call to recon, it's by no means a guarantee of approval though. and with citi, the 7-10 message is by no means an automatic denial. There is plenty of stories of people getting approved after getting the 7-10 message.