1st Financial Bank sent something to me... What d'y'all think?

[Anonymous]

I recently turned 18 and hope to build credit. I don't have a job right now but I'm glad I took a personal finance class so I can learn all that I didn't when growing up. I'm mainly looking to build credit to get one of those flight/hotel cards, under the guise of "being able to rent/buy real estate".

I do know that credit cards and loans are not free money, not sure if other people my age realize this or not.

Anyways I got this offer for a "student credit card", and the designs look straight out of 2007. Like Windows XP default wallpapers. Surprisingly has contactless.

Then I look at the APR. 31.4%. Now that's pretty high.

Decided to throw it in the trash as I believed it to be not worth it.

Was wondering if anyone had any experience with this bank. It's 1STUSA, for disambiguation. Can't seem to find a Wikipedia page for it.

[AllZero]

Congratulations on your offer!

[thornback]

Hi & Welcome to the forums!

1st USA is just like First Premier Bank (actually prob a bit worse since First Premier got slightly better after a class action lawsuit). 1st USA is Extremely Predatory. Smart of you to throw it out.

When you're ready, and if you're a student, look at Disco Student, HSBC Student (no credit history required for this one & it's a solid lender); or go for secured cards from lenders like Citi, BoA, Disco, or TD Bank (if you're in their footprint).

[Caught750]

I’m in complete agreement with Thornback. While you shouldn’t carry balances, especially while building credit, these things happen from time to time. That’s just life.

I’d definitely look at the lenders she mentioned. You should find much better offerings from much more respectable and honest lenders.

[Openwater]

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@thornback wrote:
Hi & Welcome to the forums!

1st USA is just like First Premier Bank (actually prob a bit worse since First Premier got slightly better after a class action lawsuit). 1st USA is Extremely Predatory. Smart of you to throw it out.

When you're ready, and if you're a student, look at Disco Student, HSBC Student (no credit history required for this one & it's a solid lender); or go for secured cards from lenders like Citi, BoA, Disco, or TD Bank (if you're in their footprint).

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I agree with the student cards. If you're starting, establish with the student cards. Garden for 6-12 with them, and apply for unsecured cards when you've built a name. You have no derogatory things on your file, you just done have one. Once you establish for 6-12 months you should be able to get unsecured cards with no problem. That's just my 2 cents. Best of luck. Cheers!

[Anonymous]

First off, I'd like to officially congratulate you on being 18 and self aware of how credit works. Most young adults don't care enough to see it and go on well into middle age with the same lazy mindset. Anyway, on to your question. 

31.4% is not just high, it's insanely high. However consider this, your goal with your first credit card especially one as terrible as the one you just described, is simply to establish credit. A year or so of on-time payments, should be more than enough to open you up to some better cards and better rates. Your goal with this first card should be to only charge what you can afford to pay off IN FULL at the end of every month. Be it a cell phone bill, your monthly gas expenses, or a utility bill. With that in mind, the interest rate doesn't matter because you will never accrue interest on a balance that is always paid off. Just remember that as it is important.

If the interest rate is still of concern you could always get a secured card, from most banking institutions. They usually offer descent rates on their secured cards, definitely better than 31%. How the secured cards works is you put down a deposit, usually a minimum of $500, and the amount deposited is how much credit you are granted. It protects the bank against you defaulting, so it makes sense why they trust you with it. After 6 months or a year, banks have different time frames on how that works, most banks will allow you to convert the secured credit account to a regular credit card and release the funds you deposited back to you.

I would advise that you to hold off on all of this until you secure your first job, since even one little mistake will sit on your credit report for a minimum of 7 years.

Good luck and congrats on starting off your adult life on the right foot!