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YACCT - Finally got a CC!

HardcoreRobot

HardcoreRobot

Lifer
Ill keep it short - never had a CC in college, never built any credit, graduated, got a good job (money), applied for a CC and got denied. go figure. anyways, the reason i was rejected was due to "never having carried a revolving balance".

luckily, i just started grad school so i again qualified to get a student CC. right now its an MBNA student card w/ 1000 CL issued through my bank. i want to know fastest way to build up my credit. i plan on using this card for all the things i used to use my bank debit card on. i have no intentions of carrying any sort of balance. the question is, do i NEED to have carried a balance (even 1 cent for a month) to qualify for those other cards?

i want to get credit so i can get a different card with rewards.
 
From what I hear, a CC doesn't build up much credit. But the best way to do it is carry a balance. It's going to cost you interest, though. Again, from what I hear.

IMO, rewards cards suck. I have an AMEX Blue and the rewards really aren't that great. If you spend 10k on your card, you can get a CD player. 😛 Cash back is the way to go.

FWIW, I pay my CC off every month and my credit is pretty good. (I'm 24)
 
don't carry a balance.
time is all you need. good credit will not happen instantly, no matter what you do.
 
Originally posted by: JDub02
From what I hear, a CC doesn't build up much credit. But the best way to do it is carry a balance. It's going to cost you interest, though. Again, from what I hear.

IMO, rewards cards suck. I have an AMEX Blue and the rewards really aren't that great. If you spend 10k on your card, you can get a CD player. 😛 Cash back is the way to go.

FWIW, I pay my CC off every month and my credit is pretty good. (I'm 24)
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I"m inclined to disagree. One of the Mastercard rewards programs gives you plane tickets to go anywhere in the world after you get 25,000 points. Not too bad a deal.
 
Okay, thanks for the info guys. Im just using rewards loosely, like cashback or miles or anything. I would never even consider carrying a balance EXCEPT if it built my credit faster. Also, I have 1.7 APR till March of next year. I would never do it at 13.99 or whatever.
 
And another question. I got the card yesterday... is it too early to ask for an increased limit? 🙂 Im gonna be spending > 1000 / mo....
 
Originally posted by: HardcoreRobot
And another question. I got the card yesterday... is it too early to ask for an increased limit? 🙂 Im gonna be spending > 1000 / mo....
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YES.
 
Originally posted by: minendo
Originally posted by: HardcoreRobot
And another question. I got the card yesterday... is it too early to ask for an increased limit? 🙂 Im gonna be spending > 1000 / mo....
Click to expand...

YES.
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drats. will they just up it when they feel like it, or should i still ask them (but in a few months)?
 
good god, how are you spending > $1k / month as a student????? i rarely put $1k on my CC in a month and i'm making some decent money.
 
Originally posted by: JDub02
good god, how are you spending > $1k / month as a student????? i rarely put $1k on my CC in a month and i'm making some decent money.
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Im a part time grad student (working full time still). 1000 is actually a very reasonable limit, and i doubt i will frequently spend more than that in a month, its just that I want that flexibility in case i need to make some big purchases.

 
Don't live outside your means. It's stupid and costly... I'm really suprised that the federal government hasnt brought suit against CC companies due to their usury-like practices.
 
Originally posted by: Modeps
Don't live outside your means. It's stupid and costly... I'm really suprised that the federal government hasnt brought suit against CC companies due to their usury-like practices.
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This is good advice and I have had a very good financial education from my parents. Ive never been late on any payments for anything nor carried any debt. I dont plan on starting anytime soon either.

EDIT - this is also the reason why i did NOT have a CC in college. i had no money / income, so i couldnt afford to spend any.
 
Originally posted by: HardcoreRobot
Originally posted by: minendo
Originally posted by: HardcoreRobot
And another question. I got the card yesterday... is it too early to ask for an increased limit? 🙂 Im gonna be spending > 1000 / mo....
Click to expand...

YES.
Click to expand...
drats. will they just up it when they feel like it, or should i still ask them (but in a few months)?
Click to expand...

It varies by company, Providian gives me a increase automatically every 6 months after the first 12. Usually 2K or so increase. Bank of America will allow you to request one every 9, but you need to request it, which I just did and got $1500 increase. Right now I am running a balance on my AMEX Blue but just because it's 0% APR. I use my Chase Perfectcard daily, I got $20 back in one month and I didnt even spend 1K. It gives 6% cash back on any gas station purchases for the first 90 days then 3% there after, and 1% back on everything else.

You really hurt yourself by not getting a CC earlier, even if you never use it, always get one as soon as you can. The longer your credit history the better when you go to finance a car or house etc..
 
I was in the exact same boat as you. I have had my CC for about 7 or 8 months. I have maxed it and paid it off a few times since then. Don't worry about getting your limit raised they will ask you soon enough. That and you are about to be flooded with CC offers. It really makes me laugh, back then no one would even give me a card. Now, I get offers for 20K CL.
 
1) Does your cc offer any perks/rewards?
2) Make sure to USE your cc even if it's just to pay utility bills, cell phone, car insurance, etc.
3) Is it a VISA or MC?
4) As minendo stated you DO NOT have to carry a balance and should not.
5) Making on time payments is critical even if you can only afford the minimum payment due, pay it before the due date.
6) Wait until at least 12 months before requesting a cc increase. You could do it sooner but I recommend waiting 12 mos.
 
another factor that somewhat affects your credit history, is the amount you spend per month. the recommended rule here is that you don't cross 50% of your credit limit. the main factor is still the amount of time though, and since time is a small figure in your credit history, other factors like the one i mentioned above play a higher role in determining your score.

another tip: find out if your state laws entitle you to free copies of your credit history (e.g. GA allows two free copies per credit reporting agency per calendar year; most other states allow one per agency per year). Make use of that feature and keep a check on your credit history. You can also pay $4-$5 and along with your free credit report, they will also send a credit score.

possible benifits of knowing credit score:
1. credit SCORE report comes printed with factors that :thumbsup: your score and factors that :thumbsdown:.
2. if you go to a car dealership and want to finance your car, and the salesman gives you a high interest rate "because you have a bad credit score", but you know your score is way above 700, you can tell the guy to FO.
 
that's funny, I just got the plantium dividend card from citibank a week ago with a $4k credit line, and I just turned 19.

don't know what my credit score is, but being 19 i can't imagine i have any at all.
 
Originally posted by: RossMAN
1) Does your cc offer any perks/rewards?
2) Make sure to USE your cc even if it's just to pay utility bills, cell phone, car insurance, etc.
3) Is it a VISA or MC?
4) As minendo stated you DO NOT have to carry a balance and should not.
5) Making on time payments is critical even if you can only afford the minimum payment due, pay it before the due date.
6) Wait until at least 12 months before requesting a cc increase. You could do it sooner but I recommend waiting 12 mos.
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1) 1.7 APR till March 05 - no other perks
2) i will use it for the same stuff i previously used my bank card for
3) visa
4) ok i wont
5) im only gonna charge what i can pay off at the end of the month
6) good to know

 
1) No don't carry a balance. That will not help your credit score and will cost you an arm and a leg. CC companies make money because they pocket ~4% of what you charge. Thus they make a killing even if you don't pay interest. Those who further the myth of required balances don't realize how much CC companies make from pocketing 4% of everything that everyone buys.

2) The biggest factors in a good credit score include: length of time you've had your cards and on-time payments vs late payments. You've screwed yourself out of time by not having a card earlier, so you just need to be a bit patient now. And never, ever even come close to being late. Pay the bill the day it comes in so you don't forget about it (or have it automatically withdrawn from your bank account).

3) Another big factor is the number of accounts you have open. As a bare minimum you need ~3 accounts for a good credit score. Assuming you have a student loan, or have had a car loan, etc that leaves you with the need for 2 credit cards. Get a second credit card if you can (different card, not a second card on that same account). It is a good idea in general too. Store one at home, in case your wallet is lost/stolen. Then you can keep up life as usual while waiting for a replacement.

4) MBNA raised my credit limit by an average of $9 a day while in college. They updated it every 3 months (so 90*9 = ~$810 limit increase each 3 months). Again you just need time. Asking for a credit limit increase may harm you.
 
Originally posted by: MaxFusion16
that's funny, I just got the plantium dividend card from citibank a week ago with a $4k credit line, and I just turned 19.

don't know what my credit score is, but being 19 i can't imagine i have any at all.
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This is the card I originally wanted and was rejected for.



 
Originally posted by: dullard
1) No don't carry a balance. That will not help your credit score and will cost you an arm and a leg. CC companies make money because they pocket ~4% of what you charge. Thus they make a killing even if you don't pay interest. Those who further the myth of required balances don't realize how much CC companies make from pocketing 4% of everything that everyone buys.

2) The biggest factors in a good credit score include: length of time you've had your cards and on-time payments vs late payments. You've screwed yourself out of time by not having a card earlier, so you just need to be a bit patient now. And never, ever even come close to being late. Pay the bill the day it comes in so you don't forget about it (or have it automatically withdrawn from your bank account).

3) Another big factor is the number of accounts you have open. As a bare minimum you need ~3 accounts for a good credit score. Assuming you have a student loan, or have had a car loan, etc that leaves you with the need for 2 credit cards. Get a second credit card if you can (different card, not a second card on that same account). It is a good idea in general too. Store one at home, in case your wallet is lost/stolen. Then you can keep up life as usual while waiting for a replacement.

4) MBNA raised my credit limit by an average of $9 a day while in college. They updated it every 3 months (so 90*9 = ~$810 limit increase each 3 months). Again you just need time. Asking for a credit limit increase may harm you.
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1. OK
2. I will always pay on time. CC companies are fvcking retarded to only qualify young people if they are poor students. If I have a *clean* history or *no* history, no matter how old I am, I should still qualify for the same stuff students do. Regardless of the fact that I have a job, and have been paying bills and stuff for years which the CC companies apparently do not feel the need to consider.
3. Paid for my school from savings and scholarship. Dont want to have a car payment, so Im driving my parents old car. So no loans from either of those places. Can other people comment on the benefits of having multiple cards?
4. Another card would reduce my need for a higher limit.

Thanks for the info.

 
Originally posted by: HardcoreRobot
3. Paid for my school from savings and scholarship. Dont want to have a car payment, so Im driving my parents old car. So no loans from either of those places. Can other people comment on the benefits of having multiple cards?

Thanks for the info.
Click to expand...
You are welcome. Vic will come in here shortly and tell you that you need 4 or 5 open accounts to have close to good credit scores. I personally don't think that is true, but you do need 3. Having a 4-5 won't hurt, but 3 can be sufficient. Heck they could be gas cards at the local gas station, or a store card with $100 credit limits at your favorite store. Anything that proves that you borrow money and pay it back on time.

Put yourself in their shoes. Would you loan $1000+ to a person who has no proof of ever paying back a loan? What about to someone who just got a job, and who has shown no proof of being able to keep any job for long periods or to be able to manage money? It is easy for someone to suddenly get a great paying job and then to spend well outside his/her means. It is scary to just suddenly offer a loan to them without collateral when you have no proof of responsibility. Thus CC companies are always timid about giving loans to people who passed up all the opportunities in the past to prove their creditworthiness.
 
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