Student Help

[Jungook]

Hello!

So this is my first post on the forum and I am sure there have been a billion other posts related to my question. Unfortunately, I am quite the newb when dealing with credit and the information surrounding it seems to be muddled on the internet.

Basically, I am an 18 year old man who plans to attend college in the fall. I have recently picked up a job (the last month) and since then I've become obsessed with the idea of creating and improving my FICO score. I begin my freshman year of college in about 3-4 weeks and this whole idea of becoming an adult is very exciting but it is also very scary.

I am guilty of spending hours upon hours researching which products and services are best for me but I have having a very troublesome time in the area of credit. I HAVE NO CREDIT HISTORY AT ALL and would like to start building credit at a young age to get a head start. My ultimate goal is to one day hold an American Express card but I know that those require excellent credit to be approved for.

I am aware of use of secured credit cards but I see them as a stepping stone that I can potentially avoid. Another reason for my avoidance of secured credit cards is that I would rather not open too many cards that I don't plan on using in the future and closing credit cards is another area of information that is shrouded in misinformation.

As an upcoming student I was hoping that I would be able to get a leg up in approval for credit cards even at a young age with no credit history. I have scoured the internet searching for the best card and I have stumbled upon the Discover It for Students.

So if anyone has bothered to read that long wall of text (hopefully ) I have a few questions.

1. How difficult is it to get approved for the Discover It for Students as a freshman going into college with no credit history?

2. If I do apply for it and get denied, how will the hard inquiry on my FICO score affect it and to what degree?

3. In the likely chance that I do get denied, will it hurt my chances of attaining a secured credit card?

4. Once I do get a secured credit card, will closing the card hurt my credit score once I am able to upgrade to an unsecured credit card.

Thank you for your time and cheers!

[enharu]

1. Varies. Too hard to tell without any sort of credit history.

2. 1 inquiry alone wouldn't really matter.

3. Yes, it will because you now have 1 recent inquiry. However, it doesn't affect much. You shouldn't run into any issues.

4. If the bank is willing to unsecure the card, the trade line will continue. They will simply refund the deposit. So on your CR there's no opening or closing of accounts.

You can check out Wells Fargo, capitalone, and Bank of America. Bank of America seems to have the best secured card, and also seems to be the easiest to have the card unsecured out of the 3.

Alternatively, you can check out credit unions. They might be willing to give you an unsecured card right off the bat. They are usually more lenient and a lot more generous than banks are.

If possible, get your parents to add you as AU as well, assuming those accounts are in good status with low utilization.

The best way is to set up a banking relationship. If you have no issues maintaining at least a 5 digit amount in deposits for say 6-12 months, most banks, including chase, citi, BofA, Wells Fargo, etc. will most likely be able to issue you an unsecured card right away. This is kinda a shortcut for people with thin files. You will have to either save up or ask your parents for that money.

[newbiewife]

Best way start at secured BOA or WF because after awhile they unsecured it. And just keep using it responsibly. Oh! And try cap1 as ur last option for secured cuz ill never be unsecured.

[CollegeStudent530]

1. I think it would be very difficult to qualify for a Discover IT Student Edition with no credit history. From personal experience, I had close to a year's worth of credit history before applying for it. (**GREAT CARD**)

2. Inquiries don't matter too much, especially if its only a few.

3. I doubt an inquiry would hurt your chances of a secured credit card. However, Bank of America did reject me for their secured credit card .. which I am still bitter at them for. I had an account for over 5 yrs with them too!

4. I closed my secured credit card after 3 months and upgraded to my credit union's Student Visa. I actually wondered if I could have qualified for it.. to begin with, but I have no regrets! Check out my scores and credit cards in my signature. In two years, you will definitely have these too! =)

Good luck man. A secured credit card is just a stepping stone.. and should be treated as such. I had no issue closing it after it was deemed dispoable.

[09Lexie]

Welcome to the forum! Congratulations on doing your due diligence and reading, researching etc. to answer your questions- do you know if you have a credit score? Probably not if you have no history which is why Discover would probably be a decline at this point.

If you want a secured card that graduates, BoA and WF are the best. Again, you might have difficulty getting approved without a CS.

Cap 1 for Newcomers is a possibility but they pull all 3 bureaus.

A CU is a good bet because of the relationship status they have with their members. If you are going to a 4 yr college, chances are there's a CU for the students or one nearby that has the school in its membership field.

I agree with enharu, if you could be added as an AU to an aged account with good history that would help.

1. IMO, it would be a decline with no history.
2. Inq is a temp ding to you.
3. No, but multiple inq's is not a good idea. Choose wisely
4. Closed cc may stay on your cr for up to 10 years. It can impact your CS if your util needs that closed CL.

If you are interested, here's more information on secured cc's

http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/THE-TOP-SECURED-CARDS-ON-THE-MARKET/td-p/2335...

[Jungook]

Thank you for such a warm welcome everyone.

I have decided to seek a secured credit card through my local bank.

A quick question, what is an AU exactly? I assume it's a sort of liability term to connect me to my parent's account in case things go awry?

Also what does it mean to "garden"?

[Anonymous]

AU means Authorized User. It connects you to your parents account, and can help establish credit, albeit insignificantly. Gardening means keeping your cards, spending on them (within your means), having on time payments, perhaps getting a credit limit increase, etc.

[Leadberry]

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@Jungook wrote:

Thank you for such a warm welcome everyone.

I have decided to seek a secured credit card through my local bank.

A quick question, what is an AU exactly? I assume it's a sort of liability term to connect me to my parent's account in case things go awry?

Also what does it mean to "garden"?

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If you've been with your bank for a couple years, they may be comfortable starting you right off with an unsecured card.  My bank gave me a $500 unsecured card with no annual fee and decent rewards shortly after my 18th birthday (the credit climate is slightly different now).  I would ask your banker's opinion on this, leaving the option of a secured card on the table of course.

[Luscher]

fyi. before i had any credit. april 2011 i leased a car with a co signer and was approved. that was my first account. 1 month later i applied for a normal discover card and got approved. so with pretty much 0 credit i was approved. so you never know. toyotoa financial considered me a "ghost" with no history. This was back in high school when I was 18 so I had no student loans or anything showing on my account to help. You have nothing to lose other than an inquiry