This is my first post...I just discovered this forum a few days ago out of a bit of desperation.
I'm 22 years old, and I need an unsecured credit card to build my credit score. I'm pretty much alone in this daunting task, since nobody really helped me step-by-step.
I need a credit score so I can get the ball rolling on things I wish to do: rent my own apartment, buy my own car, apply for an SBA loan with my approved business plan (they ask for a credit score of at least 700, but hey, I have to start somewhere), open business account(s), etc etc...these all request a decent credit score. I have BIG ideas, but it seems like meeting them is so far away...
My current situation: I have had a secured BankAmericard Visa since April (11 months ago), using it each month, never going over my credit limit and always paying in full on time. I already applied to upgrade to a unsecured credit card, and was denied because of an "insufficient number of revolving credit accounts"
, whatever that means.
I also have been: working at my current employer for 12 months now; and living in the same town for 3 years.My solution:
- I read in another website to apply for a Capital One CC and set up an arranged overdraft with the bank. Use it for a year, then toss the Capital One CC after applying for an unsecured CC (since apparently the CO CC is "crap"?).
- I've been told that there is a 2x2x2 rule when it comes to getting an unsecured credit card:
- 2+years working for the same company/boss
- 2+years at the same address
- 2+years of good bill payment history.
Any advice would be greatly appreciated. Thanks in advance!
You don't need an unsecured credit card to build your credit. In fact, secured credit cards are used to build credit and or rebuild credit.
Getting denied for an unsecured credit card for the reason "insufficient number of revolving credit accounts" is normal for people who are starting out. By the way, having 11 months of credit from zero credit history is still considered as young.
People considers secured credit cards as a "bad" card since it does not offer rewards or points. And people will tell you to close the secured credit card account. In my experience, having a secured credit card, in addition to my unsecured credit cards and charge card, helped me build my credit history. Secure credit cards are handy tools even if you already have a good credit score and history.
You made a mistake when you tossed your Capital One CC. I'm assuming you closed that account. Closing that Capital One CC account made you lose your revolving credit accounts. Instead of having two revolving accounts, which could have helped you by now if you only kept it open, now you only have your secured BankAmericard Visa; reducing your revolving accounts from two to one.
One rule of thumb, don't bite more than you can chew. I don't mean to make you feel bad but if you can't even manage your own finances, then it is better not to open your own business. That is, until you learn how to manage your personal finances. Those things you mentioned you want to spend money on does not rely solely on your credit score. It will also rely on the amount of money you have in your bank account. For buying a car, know your credit score and make sure you have enough money for the living expenses and car payments, gasoline, and car insurance. If you don't have enough of those, then better not buy a car.