My First Credit Card- ADVICE, please.

Porkchopz · Feb 11th, 2007, 11:03 PM

I feel silly about this, but I must share my joy at getting my first credit card at the age of... 24.

I know, I know. Pretty ridiculous, huh?

I moved out of my parents' house at 19, graduated college at 21, and have been employed full time ever since. I am pretty frugal (except for my few beloved designer bags) and have paid in cash for everything. For the past couple of years, I've applied for credit cards and store cards but have always been rejected because of insufficient credit history (not negative, just a lack thereof). My boyfriend applied for a Pier 1 card after i was rejected so I could get a no-interest loan on a couch, and of course I didn't get credit for it (even though I made all the payments). I've been panicking at the notion of not having established credit, especially since my bf (soon to be fiance) will be buying a house within a couple years.

Last month, I bought a car and co-signed with my mom on the loan, which I hope will help build my credit fast. Plus, I finally found a credit card with no annual fee (Capital One Platinum for those with limited credit history) and got accepted!

I am finally on the right track, but my question for you is how long should I wait before applying for a better card, specifically a rewards card like the United Visa? Should I apply for more of these high-interest cards just to build credit? Is it better to pay off 100% of the balance each month or leave a little debt? I can afford to pay off 100%, but I want to know what will build credit more quickly.

How can I build my credit fast?

boxermom · Feb 11th, 2007, 11:35 PM

Congratulations on your start in the right direction to establishing good credit! I wish I could answer your questions, but dh and I stumbled along, doing things badly, then getting our act together and now we have good credit and carry 2 general cc's, 2 dept. store cc's, and 3 gasoline cards.

Your questions are excellent--I'll be interested to read suggestions from other posters. I'm guessing it's more important to not be late on payments than if you pay in full or not each month. Of course you'll save on interest if you pay in full each month. I also do know that it's not good for your credit score to have frequent requests for a credit check, so don't apply for several new cards or loans at once.

colleen03 · Feb 12th, 2007, 02:51 AM

Oh my gosh. Completely pay off your balance every month or else the interest will get you. If you only make minimum or partial payment they charge interest from the day that you make the purchase.... not the due date. It is absolutely NOT better to leave a balance on your credit card and anyone who says so is misinformed. The only thing that they look at is if you make your payments before the due date.

If you want to build up your credit, then make sure that you pay with your credit card and always make the payments on time. People can easily get into trouble with credit cards when they charge more than they can pay off, because the interest rates are so high and how they are calculated.

I don't really have advice as to when you should appy for a better credit card. I do know that every time you apply for something where they need to check your credit rating (CCs, loans, etc), this can have an impact on your credit rating. This is important, especially since you are thinking about purchasing a home in the near future.

Good luck!!

Porkchopz · Feb 12th, 2007, 12:18 PM

Quote:

Originally Posted by colleen03

Oh my gosh. Completely pay off your balance every month or else the interest will get you. If you only make minimum or partial payment they charge interest from the day that you make the purchase.... not the due date. It is absolutely NOT better to leave a balance on your credit card and anyone who says so is misinformed. The only thing that they look at is if you make your payments before the due date.

If you want to build up your credit, then make sure that you pay with your credit card and always make the payments on time. People can easily get into trouble with credit cards when they charge more than they can pay off, because the interest rates are so high and how they are calculated.

I don't really have advice as to when you should appy for a better credit card. I do know that every time you apply for something where they need to check your credit rating (CCs, loans, etc), this can have an impact on your credit rating. This is important, especially since you are thinking about purchasing a home in the near future.

Good luck!!

I thought they started charging interest on the due date

.

So basically if you make a purchase with the card you should just pay off the whole balance asap, even if your statement is weeks away?

Sewon · Feb 12th, 2007, 12:24 PM

Be sure to pay of your balance each month, on time.

Use it in emergency situations only...such as a problem with your car or something like that.

Porkchopz · Feb 12th, 2007, 12:40 PM

Quote:

Originally Posted by Sewon

Be sure to pay of your balance each month, on time.

Use it in emergency situations only...such as a problem with your car or something like that.

But do you start accumulating interest from the day you make a purchase (like the above poster said)? Or from the due date? If the interest starts right away, I'll pay off my balance the next day if I have to. I just want to build my credit quickly w/out paying interest.

Blue824 · Feb 12th, 2007, 02:44 PM

Quote:

Originally Posted by Porkchopz

I thought they started charging interest on the due date

.

So basically if you make a purchase with the card you should just pay off the whole balance asap, even if your statement is weeks away?

There is a billing cycle, to make it easy, lets just say yours goes month by month. So everything you charge from February 1-28 will come on one bill. That bill will come early March and include only your charges for February 1-28, even if you put something on your card March 1 it won't be on there. If your bill is due March 26, as long as you get your full payment in by March 26, you will not be charged interest. Does that make sense? If your bill is late, they automatically slap you with fees and interest.

Porkchopz · Feb 12th, 2007, 03:13 PM

Quote:

Originally Posted by Blue824

There is a billing cycle, to make it easy, lets just say yours goes month by month. So everything you charge from February 1-28 will come on one bill. That bill will come early March and include only your charges for February 1-28, even if you put something on your card March 1 it won't be on there. If your bill is due March 26, as long as you get your full payment in by March 26, you will not be charged interest. Does that make sense? If your bill is late, they automatically slap you with fees and interest.

Yup, that makes sense. That's exactly how I thought it worked. Thanks!

merika · Feb 12th, 2007, 03:59 PM

Here's my 2 cents. First of all I don't hear good things about Capital One. Lots of people have written horror stories about paying off their CC on time but payment not posting to their account on the right date and being slapped with late charges - which wrecks havoc with your credit history also.

Try to find out whether you can enroll to pay your credit card bills online, so the money comes out of your checking account. That way you have online confirmation of when you paid your bill and when the balances posted to your account. It makes it easier to look up your account balances online too.

You may try applying for a American Express Student Blue if you are a student. They don't give you a very high credit limit initially, but do increase over time.

I did have a United Visa, but didn't find it worth the membership fee of $60 at the time. I do fly somewhat frequently.

Porkchopz · Feb 12th, 2007, 04:47 PM

Quote:

Originally Posted by merika

Here's my 2 cents. First of all I don't hear good things about Capital One. Lots of people have written horror stories about paying off their CC on time but payment not posting to their account on the right date and being slapped with late charges - which wrecks havoc with your credit history also.

Try to find out whether you can enroll to pay your credit card bills online, so the money comes out of your checking account. That way you have online confirmation of when you paid your bill and when the balances posted to your account. It makes it easier to look up your account balances online too.

You may try applying for a American Express Student Blue if you are a student. They don't give you a very high credit limit initially, but do increase over time.

I did have a United Visa, but didn't find it worth the membership fee of $60 at the time. I do fly somewhat frequently.

I have an online account with Capital One, and am keeping a very watchful eye on my balance- as soon as it posts, I'll pay the whole thing off.

Since I'm no longer a student, I can't do that card you recommended, but maybe I will look at other Amex cards for those lacking a credit history. Thanks for the tip!

My boyfriend has the United Visa and it has funded a trip to Austria and India, which is amazing to me! I can't wait for a rewards card

Nikki Guyana · Feb 12th, 2007, 05:07 PM

Only use 1/3 of your credit line & pay that in full every month. Don't apply for too many credit cards at once. That could hurt your credit score.

Porkchopz · Feb 12th, 2007, 05:12 PM

Quote:

Originally Posted by Nikki Guyana

Only use 1/3 of your credit line & pay that in full every month. Don't apply for too many credit cards at once. That could hurt your credit score.

Ooooh, this is the stuff I like to know...So 1/3 is the magic number.. How come?

lorihmatthews · Feb 12th, 2007, 05:39 PM

Your credit score will stay at its highest if you utilize less than 30% of your total credit available (of course this is only if you keep everything current).

American Express is a fantastic card to have, they have great benefits and customer service.

There's really no way to build your credit fast. It just happens over time. Don't apply for too much credit, feel free to use your cards as long as you pay them off monthly, and you'll be in great shape. You will be a lender's fantasy when you apply for a mortgage!

merika · Feb 12th, 2007, 06:19 PM

Quote:

Originally Posted by lorihmatthews

American Express is a fantastic card to have, they have great benefits and customer service.

I totally agree with you. However I don't know whether users with short credit history can get one?

Funnily enough the Student Blue was my first cc, but there were several offers available through school which was why I got it. Now I've upgraded my card to Blue, and I love it!

Archipelago · Feb 13th, 2007, 04:01 AM

Capital One was my first credit card too. I got it less than a year ago. About 3 months later, I got approved for a Chase Universal Mastercard. I recommend that you apply for that because it's a rewards card. My starting limit was only $500 but it jumped to $1000 after I made all my payments on time. It doesn't have amazing rewards but it's easy for someone with little credit to get. You earn free DVDs with your points.

Feb 11th, 2007, 11:03 PM	#1
Porkchopz I love me some MJ. Location: San Francisco	My First Credit Card- ADVICE, please. I feel silly about this, but I must share my joy at getting my first credit card at the age of... 24. I know, I know. Pretty ridiculous, huh? I moved out of my parents' house at 19, graduated college at 21, and have been employed full time ever since. I am pretty frugal (except for my few beloved designer bags) and have paid in cash for everything. For the past couple of years, I've applied for credit cards and store cards but have always been rejected because of insufficient credit history (not negative, just a lack thereof). My boyfriend applied for a Pier 1 card after i was rejected so I could get a no-interest loan on a couch, and of course I didn't get credit for it (even though I made all the payments). I've been panicking at the notion of not having established credit, especially since my bf (soon to be fiance) will be buying a house within a couple years. Last month, I bought a car and co-signed with my mom on the loan, which I hope will help build my credit fast. Plus, I finally found a credit card with no annual fee (Capital One Platinum for those with limited credit history) and got accepted! I am finally on the right track, but my question for you is how long should I wait before applying for a better card, specifically a rewards card like the United Visa? Should I apply for more of these high-interest cards just to build credit? Is it better to pay off 100% of the balance each month or leave a little debt? I can afford to pay off 100%, but I want to know what will build credit more quickly. How can I build my credit fast? Last edited by Porkchopz; Feb 11th, 2007 at 11:06 PM.

Feb 11th, 2007, 11:35 PM	#2
boxermom Member Location: North Carolina	Re: My First Credit Card- ADVICE, please. Congratulations on your start in the right direction to establishing good credit! I wish I could answer your questions, but dh and I stumbled along, doing things badly, then getting our act together and now we have good credit and carry 2 general cc's, 2 dept. store cc's, and 3 gasoline cards. Your questions are excellent--I'll be interested to read suggestions from other posters. I'm guessing it's more important to not be late on payments than if you pay in full or not each month. Of course you'll save on interest if you pay in full each month. I also do know that it's not good for your credit score to have frequent requests for a credit check, so don't apply for several new cards or loans at once.

Feb 12th, 2007, 02:51 AM	#3
colleen03 Member Location: Hawaii	Re: My First Credit Card- ADVICE, please. Oh my gosh. Completely pay off your balance every month or else the interest will get you. If you only make minimum or partial payment they charge interest from the day that you make the purchase.... not the due date. It is absolutely NOT better to leave a balance on your credit card and anyone who says so is misinformed. The only thing that they look at is if you make your payments before the due date. If you want to build up your credit, then make sure that you pay with your credit card and always make the payments on time. People can easily get into trouble with credit cards when they charge more than they can pay off, because the interest rates are so high and how they are calculated. I don't really have advice as to when you should appy for a better credit card. I do know that every time you apply for something where they need to check your credit rating (CCs, loans, etc), this can have an impact on your credit rating. This is important, especially since you are thinking about purchasing a home in the near future. Good luck!!

Feb 12th, 2007, 12:24 PM	#5
Sewon Member Location: Near A Spa	Re: My First Credit Card- ADVICE, please. Be sure to pay of your balance each month, on time. Use it in emergency situations only...such as a problem with your car or something like that.

Feb 12th, 2007, 03:59 PM	#9
merika Just me Location: In front of a computer	Re: My First Credit Card- ADVICE, please. Here's my 2 cents. First of all I don't hear good things about Capital One. Lots of people have written horror stories about paying off their CC on time but payment not posting to their account on the right date and being slapped with late charges - which wrecks havoc with your credit history also. Try to find out whether you can enroll to pay your credit card bills online, so the money comes out of your checking account. That way you have online confirmation of when you paid your bill and when the balances posted to your account. It makes it easier to look up your account balances online too. You may try applying for a American Express Student Blue if you are a student. They don't give you a very high credit limit initially, but do increase over time. I did have a United Visa, but didn't find it worth the membership fee of $60 at the time. I do fly somewhat frequently. __________________ I will also gladly authenticate your chocolates for you.

Feb 12th, 2007, 05:07 PM	#11
Nikki Guyana Member	Re: My First Credit Card- ADVICE, please. Only use 1/3 of your credit line & pay that in full every month. Don't apply for too many credit cards at once. That could hurt your credit score.

Feb 12th, 2007, 05:39 PM	#13
lorihmatthews Persian Love Location: San Francisco	Re: My First Credit Card- ADVICE, please. Your credit score will stay at its highest if you utilize less than 30% of your total credit available (of course this is only if you keep everything current). American Express is a fantastic card to have, they have great benefits and customer service. There's really no way to build your credit fast. It just happens over time. Don't apply for too much credit, feel free to use your cards as long as you pay them off monthly, and you'll be in great shape. You will be a lender's fantasy when you apply for a mortgage!

Feb 13th, 2007, 04:01 AM	#15
Archipelago Member Location: San Francisco	Re: My First Credit Card- ADVICE, please. Capital One was my first credit card too. I got it less than a year ago. About 3 months later, I got approved for a Chase Universal Mastercard. I recommend that you apply for that because it's a rewards card. My starting limit was only $500 but it jumped to $1000 after I made all my payments on time. It doesn't have amazing rewards but it's easy for someone with little credit to get. You earn free DVDs with your points.