Just Starting Out

[Anonymous]

Apped four times for CC's, finally got a 1K CL Wachovia when my dad co-signed with me.  First-year college student, I live at home, got full financial aid, and I drive my mom's car - so I don't have much need for installment loans. 

How should I go about having good credit by the time I graduate?  I was thinking I'd app for a new CC about every 6 months to a year so I can have a few cards, and maybe app for a small personal loan to mix up my credit.  Is this a good idea?

[RobertEG]

Welcome, Aupumn. It is gratifying to see one of your youth so savy about building a solid credit rating!

I would suggest not applying for anything more until you have at least 6 months of reported credit history on the new card, since you wont get a FICO score until then.

Having a bunch of credit cards is not as important as gaining at least one major card.   You probably wont get a major bank card until you show a good credit history on the current card, so give it some time.  About a year.

Having said that, the sooner you get new cards, the better for establishing length of credit history.

I would advise against a rush to get an installment loan simply to help current credit mix.  Since you apparently dont need an installment loan now, your current credit score is just academic.  You have started well by establishing a revolving account, thus giving you an account that will set your oldest date of credit history. 

Getting further accounts will become progressively easier as your payment history shows good use of your credit.  Give it a year, then app for a major bank card.  With that under your wing, if and when you need an installment loan, you will be poised.  But not now.

[Anonymous]

Honestly you really dont need that much credit cards. When I started college, I only had 1 student visa card. After 6 months, I was in the mid 700's. I would consider applying for a store card next year to add diversity (Maycs, Saks, etc). Be sure to maintain low debt to credit ratio on each account and do not miss any payments and you should see a good results in 6 months. No need to apply for more credit. Take it 1 step at a time.

[haulingthescoreup]

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Aupumn wrote:

Apped four times for CC's, finally got a 1K CL Wachovia when my dad co-signed with me.  First-year college student, I live at home, got full financial aid, and I drive my mom's car - so I don't have much need for installment loans. 

How should I go about having good credit by the time I graduate?  I was thinking I'd app for a new CC about every 6 months to a year so I can have a few cards, and maybe app for a small personal loan to mix up my credit.  Is this a good idea?

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Check out the FICO High Achievers thread (stickied up above.) We've collected the positives and negatives from people's reports in an attempt to paint the portrait of what great credit looks like.

I'd say 2-3 Mastercard/ Visa/ Discover/ American Express accounts from good banks, one store-only or gas-only card (without MC/Visa, etc.), eventually a mortgage, and eventually one installment loan seems to be the profile. For those with older histories, as in 20+ years oldest account, the mortgage and installment loans don't seem to matter, I suppose because they would probably be paid off by then.

So be choosy about what cards you get. Let your scores get up in the 720 or above area before adding a card, and be very, very thoughtful about what you get. If nothing else, let the current banking situation settle down and clarify itself to see who's still in business at that point.

The advantage of waiting to get a good card, instead of going through the mediocre ones first, is that you will build history with that bank from the beginning, and over time, this will help your credit limits and so forth.