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If you are here reading this forum/thread, you probably have heard, seen or know someone who has been leveraging credit card points for free or very low cost travel and want to get involved. While it may be very tempting to jump right in and apply for a bunch of credit cards, it is advisable to read through the forums before doing so.

For those who have no credit history, building your credit score is strongly recommended and may even be needed before applying for any credit cards.

Step 1 - Try and get added as an Authorized User (AU) on an established credit card. This card should be kept in good standing and preferably have a low credit utilization ratio.
Some have had success with Amex to get your card backdated to the primary cardholders "member since" date. Having this done will increase your credit history to that of  the account holders first Amex card.
UPDATE Amex no longer backdates any cards. Any authorized user card will show up on the AUs report as a new account, opened on the date that the AU was added. Amex is now one of the worse choices to get added as an AU to, for credit building purposes.
Chase, Citi, Bank of America and others are more likely to show the full history of the primary cardholder on the authorized user's report than Amex is.

Additional Option - In conjunction with being added as an AU, you can  sign up for a secure credit card.
A secured credit card works almost like a debit card (you need to lay out your credit limit), but this functions as a regular credit card and will help build your credit score.

Step 2 - Once you are setup as an AU, it is best to wait a few months before applying for your first card.

Your first card should be a store credit card, which are easier to get approved for, especially with very limited credit history.
Some of the store cards people apply for are Old Navy, Gap, Banana Republic, Kohl's, Macy's, Target etc. While these cards will not give you major signup bonuses to travel with, they do give you access to exclusive promotions and other perks when purchasing from the store.

Additional Options - The CapitalOne Journey card seems to be easier to get approved for, though understand they will pull your credit from all three agencies, while most banks only pull from one.

Discover has a student card you can apply for here. This can also be an easier option to getting approved for your first card. Their regular IT card (not student) seems to be pretty easy to get approved for with little to no credit history as well.

Step 3 - Pay your bill before your statement closes (cut off date), but leave a minimal amount remaining to be paid after your statement closes. This will help ensure that you have both a low CC utilization while establishing a good credit payment history. (This applies to new spending from this month.  Anything already 'due' should be paid in full.)

Step 4 - After using your first card for a few months, you will be ready to apply for the cards you will have read and heard so much about. Remember that getting accepted for a credit card is a combination of many factors like credit history and your credit score, but it is also dependent on the income that you claim* you make.  Income is not part of your credit report or score.

Step 5 - This is a brief synopsis of what to do when applying for credit cards. There are additional factors one should understand before applying for credit cards. DDF is a great resource and there are many people willing to answer your questions (which you should ask, albeit after attempting a search) 

*If you are under 21, you are legally only allowed to report personal income. Personal income, however, can include allowances and scholarships.
If you are over 21, you can claim any income which you have reasonable access to in order to pay back the bill, which includes the income of others in the household (spouse/parent), or anyone supporting you. Additionally, while most banks will not have you verify your income, it does happen and you should be prepared to show them. This is particularly prevalent with American Express, and is known as a Financial Review (FR).
« Last edited by S209 on September 09, 2018, 01:45:26 AM »

Author Topic: Credit Card For Beginners  (Read 568440 times)

Offline @Yehuda

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Re: Credit Card For Beginners
« Reply #1275 on: October 14, 2013, 11:35:53 AM »
Got it. Thanks

I was under the impression that you need to spend on a card every month for credit building.
CMIIW Please!

Oh, I thought you meant to be able to keep the card open. For credit building, I don't have much experience. (not sure how I built mine. I got a co-signed CC at 18 (used it occasionally, definitely not every month) and then didn't apply for another till I was like 20-21 and got approved.) It makes sense, I guess, if you want to build credit quickly that using it every month would be beneficial. But from what I've learned on the forum, even having just a few dollars on your monthly statement and paying it on time builds credit - no need for $200/mo.

Offline Dave321

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Re: Credit Card For Beginners
« Reply #1276 on: October 14, 2013, 11:38:25 AM »
Oh, I thought you meant to be able to keep the card open. For credit building, I don't have much experience. (not sure how I built mine. I got a co-signed CC at 18 (used it occasionally, definitely not every month) and then didn't apply for another till I was like 20-21 and got approved.) It makes sense, I guess, if you want to build credit quickly that using it every month would be beneficial. But from what I've learned on the forum, even having just a few dollars on your monthly statement and paying it on time builds credit - no need for $200/mo.

I thought so.... Ill keep it low.

just did a 3BM so hopefully ill be able to build more credit that way.

Thanks!

Offline Barryg

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Re: Credit Card For Beginners
« Reply #1277 on: October 17, 2013, 01:30:15 PM »
Got it. Thanks

I was under the impression that you need to spend on a card every month for credit building.
CMIIW Please!
Not sure that anyone knows the answer to this and it may be different in all three bureaus. I wouldn't go crazy just to make sure to spend on each card every month (maybe every six months), the main thing is that when you apply the utilization % reported needs to be low the most recent time the cc reported. I have also wrote in the past that my suspicion is that if you use your credit and then pay back (month not applying have high utilization, then pay back before next cycle closes) it for sure won't hurt score in long run, but will help as well.

Offline Dave321

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Re: Credit Card For Beginners
« Reply #1278 on: October 17, 2013, 05:02:51 PM »
I guess here is what i am trying to figure out. After a 2bm that i did this week here are is my lineup of cards:

(in order of when i got them)
Capitol One - 750
Amex Starwood- 8000
Chase SP- 12000
BA- 4000

My question is, do i need to spend on each card every month for good credit? Or does it go by total credit (meaning all my cards added up). The only reason why I have my CO card open is bec it was my first. But in terms of perks and points, its worth nothing.
Do i need to spend on it each month?

Offline raphy781

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Re: Credit Card For Beginners
« Reply #1279 on: October 17, 2013, 05:09:15 PM »
I guess here is what i am trying to figure out. After a 2bm that i did this week here are is my lineup of cards:

(in order of when i got them)
Capitol One - 750
Amex Starwood- 8000
Chase SP- 12000
BA- 4000

My question is, do i need to spend on each card every month for good credit? Or does it go by total credit (meaning all my cards added up). The only reason why I have my CO card open is bec it was my first. But in terms of perks and points, its worth nothing.
Do i need to spend on it each month?

No. Just name sure to use it once in a while so you don't get shut down for inactivity.

Offline Dave321

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Re: Credit Card For Beginners
« Reply #1280 on: October 17, 2013, 05:10:45 PM »

No. Just name sure to use it once in a while so you don't get shut down for inactivity.

great thanks!!

Offline AharonInIsrael

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Re: Credit Card For Beginners
« Reply #1281 on: October 18, 2013, 02:58:36 AM »
I've been reading up on this and some other threads, and think I'm getting ready to "get in the game", but wanted to double check what other people thought. I have a high actual credit score, with good credit history. Also, I've had the Chase BA card for a bit over a year and a half, but since I didn't report much income back then my CL on that card is only 1500. Related to the low CL is that my UR is also higher than it should be. Does it make sense to try and get two more cards, or should I wait? It will be hard for me to lower my UR because I don't have another card (I do have a stinky BoA Visa, but it has forex fees and I'm mostly in Israel).
Thanks!

Offline notanonymous

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Re: Credit Card For Beginners
« Reply #1282 on: October 18, 2013, 04:27:00 AM »
I've been reading up on this and some other threads, and think I'm getting ready to "get in the game", but wanted to double check what other people thought. I have a high actual credit score, with good credit history. Also, I've had the Chase BA card for a bit over a year and a half, but since I didn't report much income back then my CL on that card is only 1500. Related to the low CL is that my UR is also higher than it should be. Does it make sense to try and get two more cards, or should I wait? It will be hard for me to lower my UR because I don't have another card (I do have a stinky BoA Visa, but it has forex fees and I'm mostly in Israel).
Thanks!
UR is Ultimate Rewards.  Do you mean you have a high usage of your revolving credit?  Pay it off before the statement closes, so it will not report to the bureau.  If you have a good score, there is no reason you couldn't do a 2bm/3bm, and/or AOR.

Offline AharonInIsrael

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Re: Credit Card For Beginners
« Reply #1283 on: October 18, 2013, 04:46:17 AM »
Haha, yeah I meant utilization rate (or ratio). Still getting used to the acronyms :)
I payed it off, but in general my utilization rate on that card is higher than it should be- I thought they look at the general for each card (not just the last statement) and the overall utilization for all cards, no?

Offline CountValentine

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Re: Credit Card For Beginners
« Reply #1284 on: October 18, 2013, 07:35:10 AM »
30% utilization is high. I would go no higher than 29.86532%.  ::) ::) ::)
You're so far up Trump's a** you can see Giuliani's feet.  HT Baruch

Offline Achas Veachas

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Re: Credit Card For Beginners
« Reply #1285 on: October 18, 2013, 07:46:26 AM »
30% utilization is high. I would go no higher than 29.865319%.  ::) ::) ::)
FTFY Just to be on the safe side...
Curiosity made the cat smarter.

Offline Barryg

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Re: Credit Card For Beginners
« Reply #1286 on: October 18, 2013, 09:48:20 AM »
Haha, yeah I meant utilization rate (or ratio). Still getting used to the acronyms :)
I payed it off, but in general my utilization rate on that card is higher than it should be- I thought they look at the general for each card (not just the last statement) and the overall utilization for all cards, no?
It's the last time that the cc company reports to the credit unions that counts for utilization. Past history would count for other things like on time payments etc. CC company usually reports day after cycle closes (about 3 days after min payment is due). To confirm that your utilization was reported and that you're ready to apply, you can use one of the free/cheap ways to check your credit report (not real score). Try creditkarma, citi id monitor, or annualcreditreport.com.
In addition to having low utilization by paying off most (some say you can pay all, most say leave a few $'s) of your balance before statement closes, your stinky BofA Visa will help your %age. (So don't forget to use once a year or so, so they keep it open.)

Offline AvrumyW

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Re: Credit Card For Beginners
« Reply #1287 on: October 18, 2013, 11:35:36 AM »
WHATS THE BEST CARD TO START OFF?

Offline Barryg

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Re: Credit Card For Beginners
« Reply #1288 on: October 18, 2013, 11:41:02 AM »
WHATS THE BEST CARD TO START OFF?
Easy on the CAPS LOCK!!! If you have absolutely no credit the best way to start off is become an authorized user on other ppl's cards with low utilization. If that is impossible, you need to start really slow by applying to a store card (Macys, Target etc) or a gas station card... If you are asking something else, please be more specific.

Offline AvrumyW

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Re: Credit Card For Beginners
« Reply #1289 on: October 18, 2013, 11:43:41 AM »
i have a debit card from td bank