Establishing Credit

[chattiesmom]

Brit, you have gotten some fantastic advice. Adding my , be sure that when you apply for credit at a retailer they report customers with good payment records to the credit agencies. Not all of them do - some only report bad customer payment records. Also if you decide to repay a credit card/loan ahead of schedule, be sure what their repayment policies are. My daughter bought a car and wanted the transaction to help her credit history the most. She thought if she repaid the loan quickly it would help her more..... WRONG! In order for the loan and her payment history to be reported, she had to have the loan for one year and one day. Otherwise, her good payment record would not be reported.

[Deuce]

I started with a credit card through my bank, I think because I'm in the military (guaranteed income) my credit limit was pretty high, $1500 to start off with, and they offered a low interest rate. I used it for small things, gas, groceries, but paid off the balance at the end of the month every month. When I applied for a loan for my car 4 years later I got a really really great rate, which is really shocking considering I was only 21 at the time. Even the dealership guys were surprised at the rate I got considering the times we're in right now.
I think you should get on a real payroll, it'll show that you do bring in some actual cash. Banks wont want to loan you money if they don't see any money coming in, i.e. would you loan cash to someone you barely know who doesn't have a job, or any source of real income? Maybe, you do seem like a good person, lol, but at the same time you wouldn't really expect to get your money back.
Good luck, the financial times we're in suck...

[backwardsrain]

I'm 22 and applied for several credit cards, department store cards, etc and got rejected for them all. I finally had to get one through my bank. I would check and make sure that you are getting paid "under the table" legally (you are allowed to make up to a certain amount tax free) and if so, you should be able to report the amount you earn to your bank even though you don't have a real paycheck. Of course, do NOT do this if you are getting paid illegally!

Also, I would see about getting the car changed to be in your name. If it is under your father's name, you need his permission to do anything with it. Mine is under my mother's name, and when I got locked out of my car and the police opened it for me, they had to call my mom to prove I wasn't stealing the car from her. Also, if your father ever got into financial trouble, your car could be taken from you to pay his debts because it is technically his car. My friend got into serious trouble when she bought a car and it got put under her grandmother's name. Ended up losing the car.

[Britster]

Originally Posted by roseylovestosho

Did you apply for all these credit cards recently? When you apply for credit cards one after the other within a 6 month span your credit score goes down and it increases the probability that you will get rejected for every card after that.

No. Did Care Credit yesterday and applied for the credit card thru my bank over a year ago.

How can my credit score go down if I have zero credit?

Originally Posted by Cha Cha

Brit, are you a college student? If you are, working with a bank that works with college students is a another option. Around here, it is Commerce Bank. Under the employment history of the application identify yourself as a "student" and they often overlook the employment history and will start you off with a low limit card. Also, establish a checking/savings account with a bank. Once you've established a checking/savings account some banks will offer debit/credit cards that way too.

Yes, I am in college. I'll have to look into this.

Thanks for everyone's advice and help!

[RachelandSadie]

i had no credit when i got married so everything we had was done in my husband's name or before him my parent's. i have paid off two loans from local bank that didn't report so that didn't build anything for me either. my parents never planned for me to have credit either so i was stuck like you were and denied all cell phones, denied on our home loan, and denied my own credit cards from stores.

the fix?? my husband got another credit card on his account that i now use for gas and groceries and the bills are on the same account as him but the card was in my name. that way i'm building my own line of credit but we're together paying the bills on his existing account.

wonder if you can jump onto an account with ur grandma or dad and use it for gas or something just to build numbers up for the next few years?

when i have my kids i'm going to open cards in their names when they turn 18 and use them myself for our family needs just to build them up a credit line. when they go to college I may/may not give them their cards as emergency funds as long as i can trust them to be responsible with them. either way they'll have a credit line built up before they are completely on their own.

[maci_mace]

I didn't read all the replies but I am 21 too! I have had one credit card it was a $600 limit. I tossed it when I got married. Now my husband has a credit card with a $4000 limit. We use it for plane tickets and vacations, then pay it all off right away.

This is a good way to start building credit, apply for a small credit line 400-600 dollars to start. Then just buy gas, food with it and pay it off right away. I suggest getting one through your bank, and read ALL the details and info on interest rates! Most cards don't charge interest until 30 days after the purchase.

We have NO debt. No mortgage, no car loans, no school loans. We got married last summer and paid cash for EVERYTHING in our wedding, and took a year to save the mondey before hand. So whatever you do, don't go into to debt building your credit. Do it wisely!

[maci_mace]

Also, you're credit score can go low if you apply for too many cards, and if any applications get declined! I had someone applying and getting denied for credit cards in my name... and it wasn't me! FRAUD. Nothing I could do at the time to figure out what was going on so that's when I actually shut down my current card at the time.

[deonk1]

Hey Brit, I went through the same thing. I ended up having to pretty much pay cash for my degree cause the banks wouldn't loan me any money for tuition.

First I would get a credit report, I got mine and realized there was an error in it, once I fixed that it helped.

Also get a credit card, usually banks have student visa cards, it doesn't need a big limit, but that will help. When you get a credit card make sure that the companies DO NOT increase your limit without your permission. Each time you "apply" for credit it takes a hit on your score, and makes it harder for you apply for other stuff.
There are some mixed opinions on the best way to get your credit actually building. Some say you need to continually pay it back immediately, some say that you should make your minimum payment then wait until a day after the due date so that it comes up on their records, and then you pay it off the day after. Personally I like the pay it off immediately method. I don't really think it makes a difference. The other type of credit you could apply for is simple overdraft on your bank accounts, use it once or twice and pay it back, that'll help get you on the map.

What I did was just go around to all the banks until I found one that didn't require a co-signer and had a small limit. These banks are likely to approve you.

Good luck... building credit sucks. It took me 4 years of only having credit cards before the banks would allow me to get a line of credit.