Rejected from my first credit card! Reason: Insufficient established credit.

[simms]

Originally posted by: quentinterintino
Oh yeah, and the card is pretty hot... I get a lot of comments when I charge things to it. A good segway to talk to that cute waitress

I learned a new word, and someone must be thinking of the segway..
lol

 

[Kev]

I was rejected by the CitiBank dividend thing. My credit score is 760. Go figure.

They said I was rejected because I carried no "revolving balances." I guess they don't like me being responsible with the payments.

 

[RossMAN]

Kaido,

Everyone in this forum seems to be a self-professed credit expert.

My advice is to get a SECURED CREDIT CARD if you want to build your credit history.

Most major banks such as Bank of America and your local credit union offer secured credit cards.

Deposit $1,000 cash into a savings account or CD (yes it will earn interest which you keep), that account is FROZEN, use your credit card for 12 months, make on time payments. After 12 months apply for a regular unsecured cc and you'll probably be approved. Close your secured cc, get your deposit back plus interest earned.

 

[fredtam]

First there is absolutely nothing wrong with a secure credit card. It will affect your credit in the same way as a "real" card. It is guaranteed approval and greatly increases your chances of getting other credit. Generally places like Citibank have low intrest rates on secured cards and you earn intrest (small amount) on your deposit.

Second when they say "insuffecient credit history" it means he was probably a "ghost" before this application. No record of him. I doubt that for those of you who say you started with a Best Buy card this was your first application for credit.

 

[brtspears2]

There is nothing wrong with a secure credit card, but I know anyone could get a Capital One Student card or a Verizon Visa (formerly GTE Visa), the first two cards I had 6 yrs ago. I had no credit, but they gave me $500 credit at 19.99%. Just made payments on time for the last 6 yrs and now my credit is superior.

 

[Mark R]

Secured credit cards are a complete con.

Basically, you give the bank your money up front.
They earn interest on it and keep it for themselves (you don't get any return on your capital).
They loan your money back to you, often charging a very high rate of interest (usually around 20-25%)
They generally do not accept deductions from your deposit as partial or complete payment. You will have to pay penalty charges and extra interest if you do not make your payments on time.
They may charge a significant annual fee.

In summary, avoid at all cost. Use only if you have to build up credit after being declared bankrupt, or defaulting on previous debts. They may be acceptable if you need to build first time credit in a hurry - but you will pay a high price for this privilege.

 

[UCDAggies2k4]

I know plenty of people rejected for the Citi Bank Student Dividend card, due to lack of credit. So that is no garentee either.


Why would you want an AMEX card. A lot of places don't even accept AMEX.

 

[Krakerjak]

I walked into my bank to set up a chequing account and walked out with a cheque book and a student visa card.
I didn't even plan on getting one, they pratically shoved it in my face.

Maybe bacause I wanted the chequing account for direct deposit for a summer job that they were so willing to give me a credit card and not pack it full of debt.

 

[DT4K]

Originally posted by: fredtam

Originally posted by: AccruedExpenditure
Get a department store card from Macy's or Best Buy. Establish a track record then get a real one.

This will not happen either with no credit. Start secured.

Department store cards are often much easier to get than regular credit cards and will help build your credit.
Try Target, Sears, etc.
Another option is gas charge cards.

And as mentioned, there are many card companies who will approve you with no credit history.
Try CapitalOne, Chase, Citibank, and MBNA.
You shouldn't have a problem getting a card from one of those companies if you are a student with no credit.
Your interest rate will likely be high, but none of those companies will rape you on outrageous fees like many of the "bad credit" card companies like Household Bank, Orchard Bank, etc.

The "bad credit" companies are really scams. They offer you a card with like $95 enrollment fee, $70 annual fee, $7 monthly participation fee, etc, etc, etc. and give you a limit of $300. So by the time you get the card, you are practically maxed out and owe them a bunch of money.

 

[FuZoR]

weird i thought they gave student cards away...

lol

 

[Chaotic42]

IIRC you need four lines of credit.

 

[IagoCharon]

Originally posted by: BigJ

Originally posted by: Kaido

Originally posted by: BigJ
Citibank Dividend Platinum for College Students

They approve a lot of people with very or no credit.

Here's a link

It looks like they offer both MasterCard and Visa versions...which is the most widely accepted?

I currently have a Visa debit card, but I'll be using my credit card for all purchases from now on to start building credit (and paying it off right after I buy stuff).

Honestly, I really have never seen a place that took one and didn't take the other. AMEX is a different story. I have a Visa check card, so I got the MasterCard version.

Personally, at my college, they stopped accepting visa's to pay for classes. I'm not sure why. I have a mastercard debit card, and I've never been to a place that hasn't accepted it. Guess it just depends on personal preference on which one you get.

 

[Vic]

Originally posted by: Scrooge2

gaaaa! so how are you supposed to establish credit??

Credit 101:

There are 3 large credit card companies that keep tabs on your credit info. They do this by checking how much "credit" you have by seeing how many credit cards your have and adding the credit lines together. Therefore if you have 3 credit cars with 1000 each, your total credit is 3000.

However whenever people check your credit, if you want a cell phone, buy a house, buy a car, etc that requires them to check your credit, those credit CHECKS COST YOU CREDIT. EVERY CREDIT CHECK COSTS YOU POINTS ON YOUR CREDIT. This applies to APPLYING TO CREDIT CARDS as well.

So be careful of credit checks. How you start getting credit is to apply to lots of student credit cards. Having a few credit card companies looking at your credit info (even if its none) reflects that you are trying to build credit and eventually a company will take you.

*EDIT* Also debit cards DO NOT build credit. They merely take money from the bank and pays the seller. The cash gets deducted from your account the moment they swipe the card. Credit has to be defined as "buy now, pay later".

Wrong in so many ways.... only the comment about debit card is correct.. :roll:

Not "3 large credit card companies", 3 credit bureau depositories. In essense, 3 major database companies, called Equifax, Experian, and Trans Union. None of the 3 offer credit to consumers of any kind, although Equifax does have a major collection agency and Experian is formerly TRW, a major government contractor.
The actual mathematical model for credit scoring was devised and is updated continuously by Fair, Isaac, and Company, aka FICO.

Pursuant to the Fair Credit Reporting Act of 1999, inquiries (what you call a credit check) no longer harm your credit in any significant fashion. Multiple mortgage and car loan inquiries within a 14-30 day period (depending on bureau) only count as one (each). Inquiries only make up less than 10% of your credit score. The basic rule of thumb is that if you already have good credit then inquiries will not harm your credit.

The problem with the OP is that he has insufficient credit history in order to have an actual FICO score, which most lenders/creditors which use automated underwriting systems require. He needs to switch to a different company in order to establish credit. Once he has established credit, then he can look into getting that AMEX card.

And here's a rule of thumb. A company does NOT "suck" because they don't offer credit to people with no credit history. That means that they are a "prime" lender, the kind you want when you are finally are established because the only lend to people with good credit. Think "preferred" insurance. Only high risk or "sub-prime"lenders lend to people with no credit or bad credit (no credit being worse than bad credit). You don't want to stick with a "sub-prime" lender once you are capable of a prime approval. So just because they didn't lend to you when you were 18 doesn't mean that you shouldn't check them out when you're 24.

 

[PowerMacG5]

Originally posted by: BigJ

Originally posted by: BigJ

Originally posted by: Kaido

Originally posted by: BigJ
Citibank Dividend Platinum for College Students

They approve a lot of people with very or no credit.

Here's a link

It looks like they offer both MasterCard and Visa versions...which is the most widely accepted?

I currently have a Visa debit card, but I'll be using my credit card for all purchases from now on to start building credit (and paying it off right after I buy stuff).

Honestly, I really have never seen a place that took one and didn't take the other. AMEX is a different story. I have a Visa check card, so I got the MasterCard version.

One more thing. When you first apply they'll send you a letter in approx 1-2weeks asking you for proof of enrollment in college. So the card takes about a month to get.

Uhm, they didn't do that for me. They asked on the webpage which school I was going to, and that was the end of that.

 

[Kaido]

Originally posted by: Scrooge24. Try Citibank Platinum Select Divident for Students This is probably one of the best cards to get for a student being Citibank is a credible company and they took me in when I had no credit. Plus you get cash back!

Applied and received today

They didn't tell me whether or not I was approved when I applied online, it said it needed "further processing." I received the letter today with the card and discovered I was, in fact, approved. I have a $1,000 credit line.

I got the MasterCard edition since I have a Visa debit card. The card is pretty neat. It features no annual fee, 0% APR for six months, then 14.49% after that, 5% cashback on supermarket, drugstore, and gas station purchases, and 1% cashback on everything else. Not bad!

I'll try applying for an American Express card at the end of the year...anyone know how long it takes to establish credit? I really like their addition year warranty on stuff you buy.

Thanks for the help everyone!