Your First Credit Card What You Should Know
Your friend just went on his dream vacation to the Caribbean all free. He told you its thanks to the sign up bonus points he earned on his latest credit card. You are just about ready to do it but don’t know where to start. This Article Your First Credit Card What You Should Know will help you with that.
Do you have a credit score, this makes a huge difference. You can check Experian, Transunion or Fico. You are entitled to getting a free report 3 times a year.
When You Have No Credit Score
When you have no credit score, you have to start building credit.
Retailer Card. It may be easier to get approved for a retailer’s store credit card than for a general credit card, though retailer cards usually charge high interest and have low credit limits.
Low Credit High Interest Card. You may also be able to get approved for a general credit card that offers a low credit limit and charges higher interest.
Cosigner. If those options don’t pan out for you, you can get a cosigner. Keep in mind that you and your cosigner are jointly liable for all charges.
Additional card member. You can also be designated an authorized user/additional card member on someone else’s card. In that case, the owner of the card you’re authorized to use is solely responsible if you don’t pay your charges.
Secured. Another option is a secured card, which requires you to make a deposit equivalent to the credit limit you’re given. If you manage the card responsibly for a few months, you can usually convert it to a regular credit card. Be sure that the secured card issuer reports to the credit agencies.
Keep in mind. if you’re an authorized user of another person’s credit card, his or her payment habits can affect your score, too.
Which Credit Card Secondary Users Will Show Up On Credit Report
|Amex||Yes, If the secondary user is over 18 and account is in good standing|
|Bank of America||Yes.|
|Barclays||Yes, if secondary user is over 16|
|Discover||Yes, if secondary user is over 15|
|U.S. Bank||Yes, but only if the users in good standing|
|Wells Fargo||Yes, If the secondary user is over 18|
Build Credit With a Loan in Your Own Name
I don’t suggest that you take a loan to build your credit but here’s the details if you have the loans or will need to take a loan anyways.
Student loans. are one option if you’re a student, of course.
Auto loans are another option. Some car dealers offer programs for students and/or first-time buyers this may help you build credit however I don’t suggest it do to the high rates and hidden fees.
Loan With A Cosigner. If you aren’t able to get a loan on your own, you ca try to get a cosigner on a loan. But as with credit cards, loan cosigners will be liable for your debt if you’re unable to make the payments.
If all else fails, get a credit builder loan. When you’re building credit from scratch, another option is a credit builder loan. After you’re approved for such a loan, you essentially make payments into a savings account that a financial institution sets up for you. You make monthly payments (plus interest) until you’ve paid the entire amount of the loan, at which point you get access to the funds. Because these loans exist to help consumers build credit, your payments will show on your credit report. These kinds of loans are usually offered by small community banks, credit unions, and online lenders.
Looking forward to hearing from you and let me know how its going. The Next article we are going to write is which cards to apply for first.