25y/o's first CC

For just about anything you want to get off your chest about credit cards.
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Striker_9
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25y/o's first CC

Postby Striker_9 » Thu Jun 06, 2013 11:59 am

Decided it's time to get a credit card.

I just recently got a $7,000 auto loan through PenFed.

I applied for 2 of their CCs at the same time since they already did a hardpull and was denied for both. If I had done more research I would have known about their strictness.

I make ~70k a year with a very very limited credit history.

Score from Penfed: 689 Equifax
No recent non-mortgage balance information
Lack of recent revolving account information
Too few accounts currently paid as agreed
Lack of recent bank/national revolving information
Too many inquiries last 12 months

I'll be paying the card off in full every month.

Any suggestions on my first card?


Scoobynoodles
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Postby Scoobynoodles » Fri Jun 07, 2013 2:49 am

What begs the question for me is why at 25 are you now getting a CC? Didn't them brown-nosing banks drool over you new students on college campus ;) Lol, well that's how I got started and soon learned how to benefit off of them then on me.

Do you currently have a bank checking account? Perhaps you can start with that bank and pitch that you want to build a better relationship with them by adding their CC.

Discover, IMO, is best for dolling out CC's for those with limited to low-fair credit history. If you can speak with a credit rep and explain your history, they will be more understanding and probably let you in.

Else, check out credit unions or community banks to get started as they have solid credit cards as well. There are also secured credit cards, but that's for folks with awful credit and low scores where you have to put down a deposit. Never had to use those but I suppose that could be a last resort.
AmEx Platinum 2009 & Blue Cash $3.5K Delta Gold $2K
BofA BankAmericard $6K | Chase[/i] Sapphire Preferred $10K & Amazon $1.5K Freedom $2.2K | CACU Platinum $13K
Discover Cashback $8.5K & It $6K | Citi Simplicity $5.6K & TY $4.3K

Scoobynoodles
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Postby Scoobynoodles » Fri Jun 07, 2013 2:55 am

BTW - I opened my first account up around the age of 19 and am now 26, giving me a decent 7yrs+ of credit history. Your age of accounts also has a medium effect on your credit score, so it is crucial to have a revolving account open, period. Check out creditkarma.com and add your info to see how your report and score add up. Once you see that, you can make a better decision on which card is best based on your category. Obviously, certain cards will be out of your league until you build up your history, but don't low-ball yourself on picking a crappy card either, which can also be a negative.
AmEx Platinum 2009 & Blue Cash $3.5K Delta Gold $2K
BofA BankAmericard $6K | Chase[/i] Sapphire Preferred $10K & Amazon $1.5K Freedom $2.2K | CACU Platinum $13K
Discover Cashback $8.5K & It $6K | Citi Simplicity $5.6K & TY $4.3K

MemberSince99
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Postby MemberSince99 » Fri Jun 07, 2013 6:01 am

Basically they denied you for no history if you look at the reasons. The too many inquiries is the lowest reason and honestly had about 0 effect on your denial - the problem is lack of any history.

So you will have to start at the bottom. I doubt Discover will approve you even with a 689 score with no revolving history. 6 months good on time payments and reasonable utilization would get you in the door with them, I bet. I would say go for a Cap One Average/Fair credit card, you will get a 39 annual fee and a 300 or 500 limit, but in 6 months you can go for better (like Discover or maybe Chase Freedom) and get it.

That should work. If not go for something like the Amazon store card. They should let you in, and with use and PIF they give great Auto CLIs that will build you up.

Striker_9
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Postby Striker_9 » Fri Jun 07, 2013 1:01 pm

I have accounts with 5/3 bank. Their CCs look to be pretty good. Any opinions on them?

I'd probably do:
-5/3
-Apply for Discover IT after ~6 months
-Apply for AMEX when I have enough history.

Daniel
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Postby Daniel » Fri Jun 07, 2013 1:22 pm

There have been a lot of threads here discussing what to do when one doesn't have a lot of credit history, and I think the basic consensus is to put an appropriate sized deposit on one or two secured cards, and in 8-12 months of good use as defined by the bank, they can be unsecured. The two that I have recommended to personal friends are both a WF secured, and BoA secured cards at the same time. My brother put good sized deposits on each, as his income is like yours, and in that time frame they were both unsecured by the banks. I did this with only a single card and had the same result.

What do you think MemberSince99? Do you prefer the CapOne Unsecured offerings or the Secured method?

flan
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Postby flan » Fri Jun 07, 2013 6:38 pm

Striker_9 wrote:I have accounts with 5/3 bank. Their CCs look to be pretty good. Any opinions on them?

I'd probably do:
-5/3
-Apply for Discover IT after ~6 months
-Apply for AMEX when I have enough history.


Go talk to a banker at a branch. They can see what your bank activity is (I'm assuming you deposit your pay checks there, or have direct deposit...), and you can say "I just graduated, blah, blah". I rather expect they'll be able to offer you a non-secured card with that sort of income. Might have a stupidly low limit, but it'll be a real card, and I think they're reasonable about increases.

A store card might be useful, too. Most of the lenders have somewhat lower standards (which comes with higher interest rates, etc....) for those. GE capital is running Amazon's program, and has a pretty decent reputation. (the website is awful, though.)



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