How to build credit?

[BigFatCow]

Ive been trying to get a credit card but Chase bank just denied me for the 2nd time. My plan is to go down to Navy Federal tomorrow and try to apply for one, i should be able to get it since they are a military bank.

What i want to know is what are some other ways to build credit. I only have one bill right now (cable) and i always pay that on time. Is taking out a loan a good idea to build credit? I know i would loose a small amount on interest, but it shouldnt be too bad.

 

[Googer]

Get and maintain a savings account. Then after a while apply for a credit card with a Small ($500) spending limit. Do not apply for any gold or platinum cards. Pay all of your bills and never ever let one be late. Never handle a piece of mail twice, as soon as you touch it open it and reply. Do not set it on the counter to do later.

 

[BigFatCow]

Originally posted by: Googer
Get and maintain a savings account. Then after a while apply for a credit card with a Small ($500) spending limit. Do not apply for any gold or platinum cards. Pay all of your bills and never ever let one be late. Never handle a piece of mail twice, as soon as you touch it open it and reply. Do not set it on the counter to do later.

The only reason I dont have a savings account now is beacuse I put most of the money I save into stocks and my roth IRA. I suppose I could open a saving account and put around $500 dollars in it if it will really help.

All I really want is a credit card with around a $500 limit. When I applied at Chase I applied for the most basic card they had but they didnt have anywhere to put what limit I wanted.

I dont have any problem paying my bills like I said I only have one.


Im still wondering if a a loan is a good way to build credit?

 

[Tylanner]

i give you credit man.

 

[Powermoloch]

Originally posted by: Tylanner
i give you credit man.

?

 

[Mo0o]

Can't you get a credit card with a very low limit? Start with those and work your way up. Also charge all your expenses to your card, even if you can charge w/ debit. That'll build your credit

 

[BigFatCow]

Originally posted by: Mo0o
Can't you get a credit card with a very low limit? Start with those and work your way up. Also charge all your expenses to your card, even if you can charge w/ debit. That'll build your credit

thats what I plan on doing.

 

[49erinnc]

Get a "secured" Visa through Orchard Bank. It's basically a savings account with VISA access but they report it to the credit bureaus. You essentially put down a small deposit and then you can use the card to make transactions off of your deposit. Yes, the bank gets a certain APR off your savings but it's a great way to establish/rebuild credit for people who can't get conventional credit cards.

 

[imported_LoKe]

Buy little things with it, like your gas and meals. Then, make sure to pay your bill at the end of the month.

 

[Tu13erhead]

I started off by getting a checking and savings account through my bank when I was 16. Then, when I turned 18, I applied for, and received, a student credit card through Bank of America. Since then, my limit has been raised to $1k. I've had no late or missed payments after almost two years of having it. Recently, I applied for a Discover Student card and also a Citibank Platinum Student Mastercard. I just found out yesterday that I was approved for the Discover, still waiting on the Citibank.

Don't go crazy with credit card applications, since every time you apply, the company makes an inquiry to your credit report. If too many inquiries are made, your score will drop some.

I'd recommend going to a local bank and talking to someone in person about opening up a credit card. They'll give you the low down on your situation and, if possible, help you open an account.

Good luck!

 

[Injury]

Originally posted by: Tu13erhead
I started off by getting a checking and savings account through my bank when I was 16. Then, when I turned 18, I applied for, and received, a student credit card through Bank of America. Since then, my limit has been raised to $1k. I've had no late or missed payments after almost two years of having it. Recently, I applied for a Discover Student card and also a Citibank Platinum Student Mastercard. I just found out yesterday that I was approved for the Discover, still waiting on the Citibank.

Don't go crazy with credit card applications, since every time you apply, the company makes an inquiry to your credit report. If too many inquiries are made, your score will drop some.

I'd recommend going to a local bank and talking to someone in person about opening up a credit card. They'll give you the low down on your situation and, if possible, help you open an account.

Good luck!

Very good advice.

Don't expect one of the biggest financial companies in the world to just give you a credit line. Go to a local bank and start with accounts. Those people are more trusting of their customers because they can see their financial situation better. A large company like Chase considers you a risk because you have NO credit. It's hard to say whether that will become good credit or bad credit without knowing more about you.

Don't apply for cards you can't get.

Usually, unless you have negative marks on your record, you can get a Dell Preferred account... granted the interest is astronomical and you can only buy computer stuff... but it's a good way to start. I started with a 33.33% APR and $1500 limit. Paid everything off before the first bill was due (approx. 60 days after delivery or order, which, if you deserve the credit is easy.) My APR has worked its was down to about 17%... which still isn't great, but it shows that I'm building trust.



How often can you check your credit without it affecting your rating?

 

[Tu13erhead]

.

 

[woowoo]

Get an account and credit card with Navy Fed.
Keep the credit card forever.

 

[Googer]

Originally posted by: Mo0o
Can't you get a credit card with a very low limit? Start with those and work your way up. Also charge all your expenses to your card, even if you can charge w/ debit. That'll build your credit

Always pay the Credit Card Bill in full when you get it. Never let the interest accrue. You only owe them Interest if you do not pay them immeadiately. Fail to pay them and you owe them 20% more than you spent untill it is payed off.

i.e. Spend $500 and you will eventually owe $600, if you dont pay it off immeadiately.

 

[Googer]

Originally posted by: BigFatCow

Originally posted by: Googer
Get and maintain a savings account. Then after a while apply for a credit card with a Small ($500) spending limit. Do not apply for any gold or platinum cards. Pay all of your bills and never ever let one be late. Never handle a piece of mail twice, as soon as you touch it open it and reply. Do not set it on the counter to do later.

The only reason I dont have a savings account now is beacuse I put most of the money I save into stocks and my roth IRA. I suppose I could open a saving account and put around $500 dollars in it if it will really help.

All I really want is a credit card with around a $500 limit. When I applied at Chase I applied for the most basic card they had but they didnt have anywhere to put what limit I wanted.

I dont have any problem paying my bills like I said I only have one.


Im still wondering if a a loan is a good way to build credit?

Before you apply for a credit card, try having around $2,000 or more in savings. Then wait and maintain that level or more savings. After a while your bank will start begging you to apply for one of their credit cards.

Take it from me, my credit rating is in the top 10%.