Credit card mistakes as a college student - what to do now?!

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Credit card mistakes as a college student - what to do now?!

Postby ceeseventy » Wed Jun 01, 2011 5:49 pm

Back in college 3 years ago, I got a credit card (hey, i got a free pizza out of it!), ran it up to the $500 limit and paid it off until i had $170 outstanding. a petty sum in hindsight.

Well I moved, didn't forward my address, and didn't think about it again until the creditors came calling. I immediately paid it off at that point, some 18 months later, and closed the account (i acknowledge that was a bad move). Well, now I have no credit card, a healthy savings and earnings, but seemingly no credit.

I used my free Equifax account through my bank to verify that the ONLY thing on my entire credit report is that danged card. 0 public records, 0 collections, 1 negative account. It doesn't reflect my awesome bill paying for utilities and insurance and cell phone, or the spot-on rent payments, or the perfect payoff of thousands in health bills. Obviously, both credit cards I've applied for have given me the thumbs down.

Is there anyone out there who will listen to me, look at me as a real person and not an abstract number to give me a chance?!?! I just want a simple card to pay for groceries and then pay off every month so that someday I can actually get a car loan or a mortgage. Help? Thanks all!

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Postby NothingButTheTruth » Thu Jun 02, 2011 5:53 pm

Apply for a secured card. Since you have a "Hefty savings" you should have no problem funding it and paying it in full every month. Remember the amount of money you put on the card will be your credit limit so the more the better. I would also leave a very small balance on it from time to time, because if you quickly pay it in full it may look as if you dont even use the card on your credit report. (it sounds ridiculous but the way"FICO" is calculated is ridiculous.) Also make sure the card you apply for reports to all 3 credit bureau, otherwise it wont make any sense to use.

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Postby NYC_Dweller » Thu Jun 02, 2011 10:45 pm

hello ceeseventy - welcome to the forums

As I mentioned in the amex section I ruined my credit during my college years. I had a handful of charge offs with a CS around the 500's. I will always find it strange that you are offered CC applications before your first finance course lol...

I was able to rebuild my credit with sub-prime cards (low limit/high interest with annual fee). Give sub-prime credit cards a quick google and you'll see a handful of cards for building and/or rebuilding credit. Keep in mind that most of these cards will carry fees and high interest rates but this shouldn't be an issue of you pay off you balance when due.

Continue using credit for a year and apply for a prime credit card.

I was able to rebuild my credit this way and my score is now in the mid 700's. I started rebuilding with the capital one visa card. As time went on my credit limit was increased from $500 to $7500 with annual fee waived and lowered interest rates. This process took awhile so please be patient since the end results is well worth it. Today I still carry my Cap One Plat along with Chase Freedom and Amex Gold.

Stay focus and you'll establish credit in no time.

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