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kingbob
LSU Fan
Sorrento, LA
Member since Nov 2010
50685 posts

best ways to build credit
I have no credit. My dad refused to allow me to get a credit card my entire time in high school and through college. I have never taken out a loan.

I have no debt and almost no assets to my name, but just started a post-college career with a pretty good salary (mid 50s). When companies try to run a credit check, I practically don't exist.

What is the best way to go about quickly building up my credit score for the future? I'd like to be able to afford financing for purchasing houses or cars in the next 5 years.


Hoyt
Alabama Fan
Alabama: The Beautiful
Member since Aug 2011
4344 posts

re: best ways to build credit
Share secured loan or Secured Credit Card.... aka use $500-$1000 of your cash as collateral. Literally no risk for financial institution.


iknowmorethanyou
LSU Fan
Paydirt
Member since Jul 2007
6316 posts

re: best ways to build credit
Gas card.


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kingbob
LSU Fan
Sorrento, LA
Member since Nov 2010
50685 posts

re: best ways to build credit
I've looked into this through my bank (Cap 1). Are they a good bank for this?


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VABuckeye
Ohio State Fan
Oak Hill, VA
Member since Dec 2007
25293 posts

re: best ways to build credit
Capital One could be a good option. Merrick Bank may be another. I'd look at getting a basic and possibly secured Mastercard or Visa before I got a store card or gas card.

BTW, your dad did you a huge disservice. You could have gotten a student card with a low credit limit at the age of 18.

This post was edited on 6/26 at 9:06 am


kingbob
LSU Fan
Sorrento, LA
Member since Nov 2010
50685 posts

re: best ways to build credit
quote:

BTW, your dad did you a huge disservice. You could have gotten a student card with a low credit limit at the age of 18.


I'm aware of that and told him such every single year. However, his money, his rules as I also struggled mightily during that time to find jobs where I could cover any credit card expenses. Now I can, so I can decide for myself.

He's very good at budgeting expenses and logistics (building things over time with future developments in mind), but not so much at building credit and investing.


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The Spleen
Alabama Fan
Member since Dec 2010
26013 posts

re: best ways to build credit
There are several credit cards out there for someone in your situation. Check credit.com or creditkarma.com. Both will have some suggestions. Maybe open an account at a small, local credit union and they may have some programs as well for someone in your situation.

A lot of car dealership as well have programs for recent graduates to get into a car loan if you're in need of a new car. My nephew recently got a Nissan Altima at a Nissan dealership at around 4% APR, and he had no credit like you.

Those are the 2 best ways.


kingbob
LSU Fan
Sorrento, LA
Member since Nov 2010
50685 posts

re: best ways to build credit
Hopefully, my car will last me a couple more years before I need to replace it. I am most interested in building credit so I can buy/build a house after I get married (which will likely happen in the next year to a year and a half). Thankfully, she had parents who were much wiser about credit, so her credit score is fantastic. However, I'd like to not have to rely on her score.


mglsu21
LSU Fan
Prairieville
Member since Jun 2012
1159 posts

re: best ways to build credit
Apply online at Capital One for a regular non-secured credit card, preferably one without an annual fee. If you are declined, call them up and tell them you want the secured card. They will use the same credit pull and not have to pull another one and they will approve you for the secured card.

My wife did this about 4 years ago when she was in the same exact situation. She had to give them $39 to hold in a savings account and they gave her a $200 credit limit. Pretty sure you can get a higher CL if you request it, but they might require more collateral in the savings account.

Always try the regular credit card before the secured card. Try an institution that offers both. I know for sure that Cap One does both.


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LigerFan
LSU Fan
Member since Jan 2014
2350 posts
 Online 

re: best ways to build credit
I was in the same boat as you but in the last year of college. I got a credit card with my credit union with a $1k limit and used it for anything and everything I spend money on from day to day and pay off everything except for about $100. I built credit fairly quickly and about a year later got a rewards card and a car loan, both with pretty low interest rates considering my position.


VABuckeye
Ohio State Fan
Oak Hill, VA
Member since Dec 2007
25293 posts

re: best ways to build credit
Joining a credit union and getting a card from them is an excellent suggestion. Credit unions are also great to build relationships for future loans.


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LSUFanHouston
LSU Fan
NOLA
Member since Jul 2009
18295 posts

re: best ways to build credit
quote:

BTW, your dad did you a huge disservice. You could have gotten a student card with a low credit limit at the age of 18


Not sure I agree with this. Tons of college students can't manage money and get into trouble. I think it's actually pretty commendable that this person got through college without any debt.

If credit card companies are willing to throw themselves at 18 year olds with no income, they can throw themselves at 23 year olds with income.

OP, go to your bank, tell them you want to start establishing credit, they will give you a small card, charge one expense every month to it (such as all of your gas), pay it off each month, and you will be fine.

As far as a mortgage, you can get a mortgage if you have no credit. They can run alternative credit to qualify you, this means they look at things such aas utility payments, rent payments, cell phone payments, etc. Just pay all those on time each month.


kingbob
LSU Fan
Sorrento, LA
Member since Nov 2010
50685 posts

re: best ways to build credit
quote:

Not sure I agree with this. Tons of college students can't manage money and get into trouble. I think it's actually pretty commendable that this person got through college without any debt.


It's not exactly commendable, I had TOPS and my dad footed the bill for the rest. It isn't like I had to work for my tuition. I only started to pay for my own housing this past year.


LSUFanHouston
LSU Fan
NOLA
Member since Jul 2009
18295 posts

re: best ways to build credit
quote:

It's not exactly commendable, I had TOPS and my dad footed the bill for the rest. It isn't like I had to work for my tuition. I only started to pay for my own housing this past year


Well you could have taken out a card to spite your dad and caused trouble and possibly gotten cut off. Remember, most college kids are pretty stupid. I know I was. =)


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TigerSaints318
LSU Fan
Shreveport
Member since Dec 2009
1681 posts

re: best ways to build credit
When it comes car buying time make sure you have some down payment. Small revolving accounts won't help too much to get an auto loan, but cash down will buy you credit. Once you get an auto loan and make the notes on time you'll be established.


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JonTheTigerFan
LSU Fan
Central, LA
Member since Nov 2003
5864 posts
 Online 

re: best ways to build credit
quote:

However, I'd like to not have to rely on her score.


If you're planning on buying or building a house together, they will take the lower of your and her middle score. So if you have lower scores than her and your TransUnion FICO score is 660, Experian is 650 and Equifax is 640, your interest rate will be based on YOUR middle score, which, in this example is 650.

Take the advice you've been given and go for credit cards, credit union accounts, etc. I've heard of credit unions also providing "Credit Builder Loans." Maybe you could check into one of those as well. Good luck.


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htownjeep
LSU Fan
Republic of Texas
Member since Jun 2005
7396 posts

re: best ways to build credit
quote:

kingbob

Sounds like your dad is good with money and just wanted to shield you from getting in credit trouble.

Ask him if he has a credit card with an impeccable history (no late payments, low usage amount etc). Ask him if he'll add you as an authorized user. Explain to him that you don't even want the card and that you just want to piggyback off of his credit history.

My 19 yr old son has never been given a credit card nor has he ever applied. Yet his credit score is 759 (just checked last week). I started piggybacking him on two solid cards of mine that I hardly ever use. I've done the same for my 16 yr old but I can't check his score until he's 18. I'm sure it will be excellent as well by then.


kingbob
LSU Fan
Sorrento, LA
Member since Nov 2010
50685 posts

re: best ways to build credit
credit karma says I have a thin file. I guess I better get to work


beaverfever
Arkansas Fan
Little Rock
Member since Jan 2008
21108 posts
 Online 

re: best ways to build credit
My dad did the opposite. He made me get a low limit credit card for books and stuff that he paid for anyway and he made the payments so I would develop credit.


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bubbz
Baylor Fan
Baton Rouge
Member since Mar 2006
21583 posts

re: best ways to build credit
Bob do you live around the BR area? If so, I believe I could help you out.


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