(Not sure if this topic belongs in this section)
I want to get a credit card once I get to college this fall, so I can start building credit. I’ve heard that the Discover student card and the CapitolOne student journey card are excellent. Have any of you guys had one of these cards? For “student cards”, do you need a co-signer (I want to avoid needing a co-signer). Do they give a nice credit limit (I may pay down some of my student loans with it)
I have no idea about these two cards…but when my kids had student credit,cards, thei credit limit was $500. That’s it.
They had NO real income and no collaterol. It wasn’t like the bank knew they had tons of money…they had NO money.
We put them on one of our credit cards, and it was for emergency use only. And for pre approved purchases like online book buying.
We didn’t encourage them to get credit cards with higher limits…until they had JOBS…and I don’t mean 10 hours a week.
Paying down your student loans with a credit card?
Are you sure you know how a credit card works?
With an unsubsidized student loan, you would likely be paying something less than 5% interest.
On your student credit card balance, you will likely be paying more like 24% interest!
My son got the Capital One Journey CC when he went off to college. He did not need us to cosign. His limit was $750 a month. A year later it is $3,500 but he only uses it for school stuff and gets paid off monthly.
I would not recommend paying off your student loan as the interest rate is 29%.
For what it’s worth, at both of the places where my student loans have been (all direct loans), credit card payments were not allowed. You have to do direct transfers from bank accounts (or, I guess, mail in a check or something).
Oh, interesting… Let’s scratch the part about paying off loans with the card. 29% interest sounds like a nightmare :-S
@Nurse001 Was he able to increase his credit score by a lot in the 1 year period?
My kids have the student Discover card and, yes, they had to have us cosign, but there is an annual limit. It started at $500 per year. The second year was at $750. The third and fourth year were at $1000.
They are/were not allowed to use it, per our rules, unless there is/was an emergency: Hospital ER or flight.
My daughter has built up her credit status because of her flights. Southwest constantly offers her some credit cards on a monthly basis and neither she, nor her brother has spent a dime on the credit cards.
Credit cards open up a can of worms. Are you sure you want to do that? Your current bank statement should provide you with sufficient back-up cash. If you haven’t had summer jobs and don’t have a significant amount of money in your savings account, then I would suggest that you work on building those savings skills first, way before any credit card. Your savings account shows on your credit report.
Are you sure about this? I review my credit reports on a regular basis (each of the three agencies once a year, so I see a report every four months), and I’ve never seen any of my savings accounts on any credit report. If I did, you can bet I would be calling the bank to close my account and move the funds to a different bank that doesn’t disclose non-credit related personal financial information to the credit reporting agencies.
I, too, have never had a savings account on a credit report. I check my report regularly from all 3 bureaus and never once have any of my 3 savings accounts (or checking accounts or any other non-credit accounts) appeared on a single one.
I’ve had a credit card since high school (got in just before the 09 credit reforms) and they’ve done wonders for my credit score… only because I’ve never missed a payment and I don’t hold balances on there. If you get one and carry over balances then you’re not doing yourself or your credit score any favors.
I never needed a cosigner because my income was always sufficient. You will likely need one if you don’t meet whatever income requirements they have.
One place to check is with the university’s credit union (most schools have one). Open an account there, and get a debit card for the account. You should also be able to get a low-limit credit card with a reasonable interest rate. Credit unions are good places to know about and use.
Yes it increased in one year. I always have him put some food on the CC for school each month. I always pay it off at the end of each month. So now a year later his credit got increased and he has great credit.
I started off with a secure card through my bank (had a separate bank account with $300, which was my limit) and after a year qualified for a “real” card through my bank (though nothing with rewards - yet).
This was how I was able to circumvent having a cosigner, so if you have time and make all your payments on time, you should be good (but some will depend on your income, too. You’ll get a higher limit if you make more)
@Nurse001 Okay, good to know.
@“aunt bea” I have a savings account already, but I’ve never heard of your savings account being on a credit report
@romanigypsyeyes Yeah, I don’t plan on missing any payments. I’ll have a job when I get to campus, so hopefully that income will be enough to not have to have a co-signer. It would be extremely annoying to be forced to have someone co-sign a card for me
@digmedia I’m already a member of my local credit union and have a debit card. I’ll email someone at my credit union to ask about a credit card
When I get a credit card, my plan to build my credit score will just be to use the card whenever I go out to eat at a restaurant or buy something online. Basically reasonable purchases that I know I will always be able to pay off in full.
Getting a credit card as a student under 21 with no credit history became a lot harder after the Credit Card Act of 2009. That act resulted in requiring anyone under 21 to have either a large enough salary or savings to be able to pay off the card if they had no credit rating.
We are having the same problem with my daughter. Capital one student card denied her right off the bat 3 months ago because she had no credit rating. We decided to apply for a secured card through her bank TD bank, and just got a denial from them a couple of weeks ago, not because she doesn’t have enough money(which she does and is happy to have them put a hold on) but because she was denied a credit card in the last 90 days. We will wait until Sept and try again.
A few reasons to have an established credit rating before you graduate:
Landlords pull credit ratings these days
You get a better car insurance rate with a better credit rating
You get a better loan rate and credit card rate with a good credit rating
Some employer pull your credit rating
@greenteafanatic that sounds like a good plan. Wait until you have a job then apply. The Capital One Journey is for college kids so you shouldn’t have any problems once you have a small income. We only listed my son part time job and he received without any issues.
@bminfla “A few reasons to have an established credit rating before you graduate:
Landlords pull credit ratings these days”
-Oh, trust me, I’m aware of this fact. A few years ago my family tried to move into a nice apartment complex, but they denied us because my mom’s credit score wasn’t to their standard.
@Nurse001 Yep, I’ll do just that. I’ll start working for a month or 2 and then apply for a card. My job will be work-study, but I’ll also try to work a few more hours part-time a week somewhere else, so I can have more money.
Just apply for one. Interest rate doesn’t matter if you pay it off every month. Just make a few small purchases and pay it off every month to build credit history.
Well, someone above said that their daughter applied for a card, got denied and had to wait 90 days to apply for another. I would be very annoyed if that happened, so saying “Just apply for one” isn’t really helpful