18 Years Old With Minimal Credit

[Anonymous]

i dont get how you have 3 credit cards with that credit score mine is 680 and cannot even get approved for one.

[Anonymous]

You probably need to pay down those cards, but there's another big issue that I think is probably the forest being missed for the credit score trees.  You mentioned scholarships, so I'm guessing you are a student.  To qualify for a very bottom dollar car loan from most major lenders you are going to need $15,000 a year of consistent monthly non-seasonal income. Maybe things have changed a lot since I was in school full time on a scholarship, but I doubt you have the income to support a car loan. The two areas where that credit score will intersect with this and be important is that with that 629 credit score, you will need a longer job history and your interest rate will be higher.  The higher interest rate means higher payment and with that a higher income requirement.

If you have solid 2+ year job history with a $15k income, then when you get those cards paid down below 30% of available credit try the Capital One Blank Check Program or Lending Tree. 

[Anonymous]

Use of credit is quite heavy weighted. Recently I applied for a mortgage and my score was 730. After I purchased my home I had to use my credit cards for other bills, payments and deposits, i.e. for electrical meter account etc, (I really spent all my money) and I almost maxed them all out. My score dropped from 730 to 607.

Paying off all those cards and keep the balance at 10%, but using them offen would, help to boost the score back up.

[Anonymous]

Hi,

This is what I would do as long as you have the income to debt service the credit:

1. Pull all 3 credit reports and have them mailed to me. Make sure that you do not have any unauthorized inquiries/id theft.
2. Pay down to under 30% utilization, better yet pay off the current cards.
3. Call the credit card companies and ask for an increase in your limit and decrease in interest based off your payment history and let them know you are not authorizing a credit check. Repeat this every 6 months.
4. Obtain a personal loan for $500.00 - $1000.00 from a credit union. Pay on it for 6 months then find a retailer that uses American General as a financier and purchase an item using their financing since American General underwrites for auto loans. Once that acount has been service for 6 months then you could call them about an auto loan as long as your total credit utilization is still under 30% and you have 10% to put down.

One thing you want to start paying attention to is any time you get approved for credit, note who the underwriter is. You will find it easier to to obtain an approval from an underwriter that you already have an account in good standing with.

Good Luck.

[Anonymous]

I understand your frustration. I am the Sales Manager of a car dealership and only having 3 cards with no comparable auto credit and no cosigner your score could be 700 plus and it still wont matter. But i have a ray of hope for you. The manufacturer that I sell for has a first time buyers program and if approved the rates are very low - they dont hurt you for being a first time buyer. You can lease under this program as well if you want a really low payment for a new car. The only requirements are that you have to have been on the credit bureau for at least one year and made all your payments on time (which i believe you said you did).

Edited post to remove personal info. The FICO Forums Guidelines and Terms of Service prohibit advertisements for other web sites and services, or other commercial solicitations. - llecs, moderator

Message Edited by llecs on 02-24-2009 11:51 PM

[Anonymous]

Also ask youself if you want to burden yourself with a new car loan at 18. Most chicks will understand if you drive a nice used car as long as you have money to do things, which is much easier with an extra $3-500 in your pocket every month.

Enjoy your youth and don't be in a huge rush to get into adult level debt

[Anonymous]

Here is where I stand financially. I work for CVS, and I am going to school to be a pharmacist. I work 20 hrs a week, get paid for 45. I am a pharmacy technician, so my hourly wage is actually pretty good, and I have absolutely no bills. That was just in reference to the question about me being in school and working In either case, do I pay my balances down all right now, or do it over the next couple of months?

[Anonymous]

if you have the cash, pay them at once.  There is no benefit to waiting,

[Anonymous]

Not true mickie08.   The benefit to paying off over a few months is that you will then have 2-3 more months of payment history.  Showing you're responsible - paying down the balance, and making the payments on time.  In fact, use that thinking in the future if you haven't used a card in a while.  Make a purchase of a few hundred bucks on a lower interest rate card.  Pay it off over 2-3 months.   You'll pay a couple of bucks in interest, but will benefit from showing a recent payment history.

[Anonymous]

Definitely pay them off now. If you want to buy the car in May you need to have the balances much lower.  You said you have no bills? Not even a cell phone? Once the cards are paid off you might want to have something small every month charged that you pay off every month so you have good utilization and a good payment history. (I autopay my phone bill)

I bought a car when I was in college full time and working part time with credit very similar to yours so I think you will be okay, you just have to find the right dealer. The only difference is you make more than I did and the economy is worse now. No offense to the other posters but I do not think you should go out and get a personal loan right now. If you were going to wait a year to buy the car then that would be a good thing but May is right around the corner, creditors look at inquires very seriously when you have little history. I've had my Discover Card for 9 yrs and they still have a problem with my length of history. 

I wouldn't buy a new car either considering your going to be in school for the next 6 yrs at least there's no need to throw your money out the window. You'll have plenty of money for that when you get a job as a pharmacist.