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I'm 19 and have zero credit, I've never applied for anything and to be honest I'm scared from what I've heard from people.

Do any of you think it's a good idea to try to start building my credit this summer? I've talked to both of my parents and they are very "anti-plastic" because of their past, but I think it would be good for my family to have one just incase of a "emergency". I'm cautiously looking into it, I don't plan on actually using it much since I'm a cash only guy and I don't want to be an another American in debt. I'm sure I'll need good credit when I'm out of college so in a few years...I can haz good credit? :lol:

Good idea to start, or bad? I'm still taking to my Dad about it since he says what does but extra advice is good.
 

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I was in the EXACT position. My parents don't have 1 card still to this day. Having a few cards in great standing is the only reason I have my Camaro today (I got them only a few years ago and I'm 25 now). They'll build it, and will hurt it real bad too. If you can behave yourself, yes, good way to get a good standing now which would be beneficial down the road.
 

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I forgot exactly..but it's been a few years.
Having good credit is a severely beneficial thing. Even with a score of 720 I couldn't get the loan for my G5 in the middle of the credit crisis because of a lack of credit history. My dad cosigned and I got it easy..he has a score of over 800.
If you know what you're doing and only use the card to get what you can actually pay for then it will be severely beneficial. I pay off my credit card every few weeks..have never paid any interest on it.



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Discussion Starter #4
How long does something like a 720 take to earn? I've read that anywhere in this area, and you're good to go...Months, years? I'm pretty clueless on credit since my parents don't use it much anymore. I already have a decent size bank (for 19 alteast) incase I lose my job and had an upcoming bill.
 

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How is your credit now? Will depend on how long it will take to get to 720. I have had a credit card since 16. Which was a big mistake. I ran it up many, many times....till I learned my lesson.
 

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Adam if you dont have any credit then you need to start imo.

I got my first creditcard when I was 17 however I didnt use my Creditcard unless I had the money already put back to pay it off.
Paying things like cellphone bills or any type of Bill "on time "
is a VERY big thing. However Creditcards help very much as well.

Yeah I have paid a vehicle off before and have never been late on a creditcard bill and yes I had help by making house payments on time but this is what got me my Camaro.

Thanks to Classic and there finacial department they ran my credit and saw I had excellant Credit numbers and beat my 4% apr that my bank offered and got me in at 3.6%


CREDIT is important. Even if you have to have someone cosign at a early age for something start building it some how.


do not get into CREDITCARD trouble.
 

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At your age, i would get 1 credit card. Link it up auto pay to something, say your cell phone bill, and buy something you normally otherwise would buy cash (I.E Coffee in the morning).Then be sure to pay it off every month. (some people suggest that keeping a small balance is actually better, not honestly sure about that)

That will be a good start to building your credit, and won't put you into debt or anything scary because you won't be buying anything you normally shouldn't. Also you can set your limit low to protect yourself from the itch. Say 1k or something.
 

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While you can get a credit card to help build credit, there are plenty of other ways to build credit without them. Also consider, you do not need a high credit rating to succeed in life :D

Co-signing in a lose/lose situation and should be avoided at all costs.

One way, when you move out and rent a place to live, that will build your credit.

A quick search will turn up more ideas :D

Some good reading about credit cards, while some people use them responsibly (most do not), check into the fees and other ways the card companies are coming up with ways to make more money off people who pay off their balances every month. Not to mention the TERRIBLE customer service.

http://www.daveramsey.com/article/credit-card-qa-with-dave/lifeandmoney_creditcards/

:cool:
 

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As long as you use a credit card like cash (making sure you have the cash in the bank) you will be good.

Just start using it to pay bills that you would normally use checks or cash.
 

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I got a credit card when I was 18 and the limit was $250.... After awhile since I kept paying it as soon as I got the bill my limit went up to $500 and so on
 

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I'm sure you will not get a limit any higher than $500, especially if you have a minimal income. Just pay your cell bill with it or things like that. Essentially, if there is anything that you happen to write a check for each month, just charge it and then write one check to the card company when the statement comes.

Be careful using it for things like gas and food -- those things will add up fast.

You may want to peruse www.myfico.com to learn more about your credit and scoring.

And as for renting and building credit -- I don't believe any apartment companies report to credit agencies. While they may check your credit when you first apply to determine what sort of security deposit to ask for, they won't report your rental history -- unless you go to collections.
 

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yea best thing to do when getting a credit card is to get one of those "student" credit cards with a low limit.

and PAY IT OFF EVERY MONTH! if your balance is not zero after making a payment, then it is like a ripple effect and will never get paid off.

my parents were also very "anti-credit"

it will take 5-10 years to build a perfect credit score. credit companies have become very strict the past couple years, and it is not easy for us "young folks" who do not have enough credit history.

i have decent credit, never late on any payments & i always pay stuff off before interest hits, but student loans stacked up from college, which does not look good to lenders.

i went through so much trouble getting a loan for my camaro. 5 banks denied me because they "did not believe my income" even though i had the paystubs to prove it and i "did not have enough credit history" i finally had to ask my dad if he would co-sign, the only stipulation he had was he got to drive the car whenever he wanted (but i live 500 miles away :muhaha:) i had to put $9500 down ($4k more than i wanted) just to get a loan because i had no trade-in and the bank would not lend anymore. and the interest sucks! 8.5% and i am paying about $200 more each month so i have to pay less interest in the long run. i plan on trying to refinance at a lower rate and fewer months after i've made my 12th payment.

times right now are tough for young adults. but we just have to deal with it!
 

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And as for renting and building credit -- I don't believe any apartment companies report to credit agencies. While they may check your credit when you first apply to determine what sort of security deposit to ask for, they won't report your rental history -- unless you go to collections.
Correct. I was not referring to FICO, but building a great credit 'reputation' or 'rating'.

FICO has successfully marketed themselves as the end all of credit 'ratings' when they are nothing more than a debt score. You only have a FICO score when you incur debt.

I've learned over the years, there is really nothing you NEED a high FICO score for. Lenders have convinced the public that you do however.
 

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Got my first credit card at age 18 and I would highly recommend it as long as you are responsible and pay it off monthly. Don't put any purchases on it that you cannot pay off within a month.

On the other hand, if you feel that you will be tempted to buy things you do not need or cannot afford, I would hold off on getting a credit card now. Some lenders may still be willing to give you a chance, as long as there is collateral against the loan.

Remember, no credit is better than bad credit!
 

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actually RS no credit is worse then bad credit

you need to start somewhere adam showing that you can handle revolving payments. a low limit credit card is the best way to go (if you are able to qualify for one, may even have to ask for your parents to co sign on that as well)

once you've had the credit card for a couple years then you can look at applying for other small loans. just holding the credit card isn't going to guarantee that you'll be able to jump into a vehicle payment. when you are applying for things such as loans your credit rating (beacon score) is definately one of the biggest thingst that the bank looks at, however they also look at what the highest monthly payment is that you've had to handle. if you're just making min payments on a cc ($50 or less) then the likelyhood of you qualifying for a $300-$400 car loan on your own is very slim

it will take years to build up your credit but don't let that discourage you. you have to start somewhere and if you start smart with the CC and make your payments on time then you will be better off in the long run.

for the CC to work in your favour though you have to put charges through on it and pay it off. it does you no good for your credit rating if you get the CC and it sits there with no balance. by doing this you aren't showing the bank that you can handle making the payments

hope that helps a bit
 

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actually RS no credit is worse then bad credit

That's what I always thought until I heard it directly from a few bank lenders themselves. I'm sure some lenders feel differently, but I actually have two friends that as recently as last week got motorcycle loans through the same bank. One of which has never had a credit card or anything else that would build his credit and the other had bad credit. Keep in mind both of these loans have collateral, but none of them put a downpayment or anything. My friend with no credit got a loan without a co-signer and my friend with bad credit had to get his brother to co-sign. They are both full-time students with minimal income, so there annual wages are pretty comparable.

If I didn't know these two personally, I would not have believed it.

Not to sound like a broken record or anything, but what it all boils down to is just be smart and responsible. If you do these two things, you have nothing to worry about.
 

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wow that's just crazy that they got motor cycle loans

things must be different in the states then here. at least here if you have bad credit you can still usually get financing the rates are just ridiculous. and in the no credit situation is where the co signer comes into play

but you're very right being smart and responsible is the two biggest keys in this
 

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when i was lookin at buying a harley a couple years ago, they did a credit check, no problem getting the loan, but 13% interest :eek: i told them they were crazy if i was going to finance something with that high of interest. they said that is normal for rec. vehicles and it is like a credit card, not a loan! :facepalm:

be sure to read the fine print, including minimum payment, interest rate, and number of months to pay it off when buying a recreational vehicle. they might tell you your financing it with a loan, but it could just be a credit card they open in your name and the monthly minimum will take 30 years to pay off!
 
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