What's the best way to start establishing credit?

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lorkat89
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What's the best way to start establishing credit?

Postby lorkat89 » Thu May 03, 2012 9:06 pm

I am 22 years old, I work full time, and I really want a credit card. So I can build credit and you need one to rent a car or book a hotel room (which I've never done, but I want to be prepared). I know you can use a debit card, but I prefer to just use my debit card for paying bills (I use cash for everyday stuff). And I also use it for buying online (which I always read that credit is safer).

  • I have no credit history and have tried getting a card in the past just to be denied because of my lack of history. It has been over a year since I last tried (almost 2 years). I am thinking of establishing credit with the Capital One secured card. But my fear is that I will be denied. How often does that happen?
  • If I get the card I'm thinking since I want to build credit I will have to use it every month (will I have to use a credit card every month forever?). How long will I need it before I can move on to the Discover Motiva? I mean I'm not big on reward cards because you have to spend money on certain things and I don't really use cards in everyday life. But this one you get rewards for paying the bill on time which is definitly what I will do. Pay on time and in full. But after I get that one I will cancel the Capital One card (it has a yearly fee and I only want one card to deal with).
  • So I'm just wanting to be able to purchase online, and book hotels or rent cars if the need should ever come up. Would those two cards be the ones for me? And when should I check my credit score? Before I try for the Capital One card or after? I mean you only get one free a year so it's gotta count. And there's so many sites, which one is the best?
Sorry for asking so may questions at once. And thanks in advance for any help ^_^.
Capital One Secured Card - $1,200 limit
Citi Double Cash - $2,000 limit


Money card
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Postby Money card » Sat May 05, 2012 9:33 pm

You don't have to use it every month, but use a credit card every now and then as long as you have money in your checking account. Use the card for a restaurant, holiday shopping, getting your car oiled and lubed etc.

A Discover card will be hard to get. Even though you're looking at their lowest level, it's Discover and it goes on your credit report as Discover. Yeah it's easier to get as compared to the Discover More, Open Road, etc.

I would say after you get 2 lower level cards like Key Bank, TD Bank, Provident bank credit cards, after you get a couple of these lower level cards you can then try for your Motiva card.

bmw1990Z
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Postby bmw1990Z » Sun May 06, 2012 6:06 am

I always post this to people because I was in your shoes 1.5 years ago but go with citi. They approve alot of people if you are a student
Cards in my wallet:
-Citi Forward Card for College Students-July 2011
-American Express Platinum Delta Skymiles--July 2013

Crashem
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Postby Crashem » Sun May 06, 2012 4:51 pm

Capitalone for newcomers. Credit union. Your bank in branch and talking to them
Amex Centurion, Amex Platinum, Amex BCP 8k->24k (5/23/12), Amex TE 15k, Cap One 1.5% 15k->20k (8/7/13), CSP 25k, Chase Palladium 100k, Citibank AA 35k (AU), Firestone 1.8k->2.2k->2.4k (8/20/12), JFCU Jloc 30k, PenFed Plat Rewards 30k, SF Fire 30k, US Bank Cash+ 25k

lorkat89
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Postby lorkat89 » Sun May 06, 2012 7:29 pm

So is it a bad thing that it shows on the credit report as Discover? Are Discovers really that hard to get? I mean it'll be probably a year or two before I try for one (after getting my first credit card).

Unfortunately I'm not a student so that cuts out a lot of cards that might approve me.

I thought Capital One for Newcomers were for people new to the US (that's what it says on their site). And I've been here all my life. My bank won't give me a credit card unless I have a cosigner and no one wants to sign.
Capital One Secured Card - $1,200 limit
Citi Double Cash - $2,000 limit

Crashem
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Postby Crashem » Mon May 07, 2012 12:04 am

Go ahead and try for capital one for new comers. Check the credit unions. Also, secured cards will work but you need to come up with cash. Try and get 2-3 cards and in 6-12 months, you can go for better cards assuming you use the cards correctly (PIF etc.).
Amex Centurion, Amex Platinum, Amex BCP 8k->24k (5/23/12), Amex TE 15k, Cap One 1.5% 15k->20k (8/7/13), CSP 25k, Chase Palladium 100k, Citibank AA 35k (AU), Firestone 1.8k->2.2k->2.4k (8/20/12), JFCU Jloc 30k, PenFed Plat Rewards 30k, SF Fire 30k, US Bank Cash+ 25k

lorkat89
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Postby lorkat89 » Mon May 07, 2012 8:36 pm

I do have the cash for the secured card I'm just too afraid to send in the application. And 2-3 cards? Would I have to keep them open forever? I really just want to one day own a Discover Motiva (the only rewards card that makes since for me). And then just stick with that one card. I just like to keep things simple.
Capital One Secured Card - $1,200 limit
Citi Double Cash - $2,000 limit

PopiLopi
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Postby PopiLopi » Mon May 07, 2012 10:07 pm

Try the Capital One Journey for students or the Newcomers. They put on the site they're for that specific population, but in no part of the application they ask you to put the school you go to or the country where you came from... The one for students even offers you a 50% cli after you make your payments on time for 6 months
Amex: Business Platinum (09/12) BCP $10,500 (03/13)
Visa: Capital One Journey $750 (04/11) Chase Freedom $1,800 (04/12)
MasterCard Citi AAdvantage Platinum Select $8,500 (05/13)
Discover: Discover It $2500 (07/11)
Store Cards: Amazon $3900 (12/11) Macy's $500 (04/11) Kohl's $500 (05/12) Victoria's Secret $750 (11/12)

PopiLopi
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Postby PopiLopi » Mon May 07, 2012 10:13 pm

lorkat89 wrote:I do have the cash for the secured card I'm just too afraid to send in the application. And 2-3 cards? Would I have to keep them open forever? I really just want to one day own a Discover Motiva (the only rewards card that makes since for me). And then just stick with that one card. I just like to keep things simple.


Most people qualify for secured cards because you have to give them the money up front, it's like paying to establish credit... Also, having a few credit cards in your profile looks better than just one, if they don't have an annual fee you can always put them in a drawer and use the one you like the most...

You also mentioned you wanted a credit card to rent a car, did you know that most car rental companies charge you around $25 extra a day for being under 25yrs old, enterprise charged me $30 a day on January, just one week before my 25th birthday :'(
Amex: Business Platinum (09/12) BCP $10,500 (03/13)
Visa: Capital One Journey $750 (04/11) Chase Freedom $1,800 (04/12)
MasterCard Citi AAdvantage Platinum Select $8,500 (05/13)
Discover: Discover It $2500 (07/11)
Store Cards: Amazon $3900 (12/11) Macy's $500 (04/11) Kohl's $500 (05/12) Victoria's Secret $750 (11/12)

andy1088
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Postby andy1088 » Tue May 08, 2012 2:19 am

PopiLopi wrote:Most people qualify for secured cards because you have to give them the money up front, it's like paying to establish credit... Also, having a few credit cards in your profile looks better than just one, if they don't have an annual fee you can always put them in a drawer and use the one you like the most...

You also mentioned you wanted a credit card to rent a car, did you know that most car rental companies charge you around $25 extra a day for being under 25yrs old, enterprise charged me $30 a day on January, just one week before my 25th birthday :'(


Hertz runs specials for people under 25. I have a coupon code for a vacation I'm going on in 3 weeks and I got $15 off a day.
My cards
Chase-Sapphire-$5,000 Freedom-$3,000, Amazon rewards-$700, Slate-$600
Citi- Diamond Preferred-$4,000, Thank you-$2,500
Discover IT-$2,500
Bank of America cash rewards-$2,000
Capital one newcomer rewards-$500



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