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Finally Got a Credit Card!

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Finally Got a Credit Card!

Old 11-15-10, 10:38 AM
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Finally Got a Credit Card!

After years of denials, wasted time filling out applications and receiving rejection letters, I finally received my first credit card in the mail on Friday. I held it in my hand almost in disbelief. Finally, someone had given me a chance to get out of this damn credit suck hole. The only way I could get this card was to apply for a secured credit card with a bank and put up a $200 dollar deposit.


I just find it so ironic that the system has rejected me completely because I am actually frugal with my money. I never liked the idea of credit. Buying something and paying later. I am too forgetful. I would lose track of my purchases and forget to pay the minimum. I didn't want to fall in the same trap that wiped out my brother and forced him to bankruptcy. I am old school. Save up your money, and then buy. I laughed at the masses throwing their money away paying interest.

But in this century, things changed drastically. Suddenly, your credit report became a deciding factor for getting a cell phone to renting an apartment. I had no credit history which is worse than bad credit. I had to get my parents to cosign so I could get a phone and buy a vehicle. Even after paying off the car on time, my credit score still didn't go up!

I tried bank loans, countless credit applications, but it just seemed impossible to get any kind of credit to raise this frakking score. I even got rejected at the cash register for a JC Penny's card even though the clerk practically guaranteed that I would get accepted.


Just boggles my mind that these companies will hand out CCs to school kids like candy yet even with a stable income, I am deemed a higher risk.
Old 11-15-10, 10:58 AM
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Re: Finally Got a Credit Card!

Think of it from a credit card issuer's perspective. You've never needed credit before and suddenly you're applying for credit. Usually people do this because they're experiencing some sort of financial hardship and represent a credit risk. Also, with limited credit history, banks have no way to assess your intentions. I'm not saying that either is true in your case, just that it's hardly surprising that banks won't lend money to people they know nothing about...

...unless they can securitize the receivables in an off balance sheet vehicle and sell the resulting securities to suckers. But that's a story for another day.
Old 11-15-10, 10:59 AM
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Re: Finally Got a Credit Card!

Awesome. Charge that bitch up! Worry about payin' it off - meh - some other month.

When I was younger, I never went to college and broke myself in with a secured credit card. I used all of my personal cards to start a business. And that makes my credit look bad, I know (moving, maybe, $15k every month). But I don't have to worry about that much anymore.
Old 11-15-10, 01:02 PM
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Re: Finally Got a Credit Card!

I think it's the fact that you kept applying made you look like a bigger risk than you claimed to be. Imagine if your brother keeps asking you to borrow some money, even he has no history of default, would you lend him any?

Also, the fact that you applied for a secured credit card will make your credit history worst than it already is.
Old 11-15-10, 01:09 PM
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Re: Finally Got a Credit Card!

My Dad had me get a credit card when I was 17 to start building credit. Sucks that that kind of thing is needed, but with building credit history, ya gotta start somewhere...
Old 11-15-10, 02:27 PM
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Re: Finally Got a Credit Card!

Originally Posted by dvdjunkie32 View Post
I laughed at the masses throwing their money away paying interest.
I laugh at the fools that don't earn cashback on their purchases and pay for their items immediately rather than letting your money sit in the bank for another month earning interest(it hasnt always been sub 1% interest rates at the bank) and then paying in full a month later. I get 5% back on gas, grocery and drug store and anywhere from 1-3% back depending what card I use on everything else. But yeah the masses you laugh at are the reason we have this financial reform BS and the reason a lot of my rewards will be going away.
Old 11-15-10, 02:36 PM
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Re: Finally Got a Credit Card!

Originally Posted by SuperJim88 View Post
Also, the fact that you applied for a secured credit card will make your credit history worst than it already is.


Say that sentence out loud and see if it makes any sense...

And your advice is incorrect. Showing a positive history of paying back secured debt on time is infinitely better than having no credit history at all, let alone bad credit.

Last edited by Hokeyboy; 11-15-10 at 02:45 PM.
Old 11-15-10, 03:25 PM
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Re: Finally Got a Credit Card!

Don't look for it to help you much. Since turning 16 I have had one only credit card. I never carried a balance and always paid off the balance in full and on time. I never financed a car or any large purchase. When landlords would do credit checks on me I would come up as having "no credit history". The credit card was not enough to boost my credit score up to even being recognizable, even when I had a $5,000 limit and a very large net worth. I still don't understand the "mysticism" of credit and credit scores, but I do know that having one credit card doesn't help you one bit.

When it came time to buy a house my credit score was 650.

My wife, who had zero net worth, a car payment, 8 to 10 credit cards, occasional missed payments, and had financed the purchase of $2,000 worth of furniture had a 720.

Credit scores are vodoo bullshit that I will never understand and I imagine cannot be understood.
Old 11-15-10, 03:30 PM
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Re: Finally Got a Credit Card!

Originally Posted by Jacoby Ellsbury View Post
But yeah the masses you laugh at are the reason we have this financial reform BS and the reason a lot of my rewards will be going away.
Actually, the masses are why you had the rewards to begin with. If everyone behaved "responsibly" in regards to credit cards, the rewards wouldn't be profitable.
Old 11-15-10, 03:31 PM
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Re: Finally Got a Credit Card!

Congratulations. Be careful!
Old 11-15-10, 03:33 PM
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Re: Finally Got a Credit Card!

Originally Posted by Mabuse View Post
Don't look for it to help you much. Since turning 16 I have had one only credit card. I never carried a balance and always paid off the balance in full and on time. I never financed a car or any large purchase. When landlords would do credit checks on me I would come up as having "no credit history". The credit card was not enough to boost my credit score up to even being recognizable, even when I had a $5,000 limit and a very large net worth. I still don't understand the "mysticism" of credit and credit scores, but I do know that having one credit card doesn't help you one bit.

When it came time to buy a house my credit score was 650.

My wife, who had zero net worth, a car payment, 8 to 10 credit cards, occasional missed payments, and had financed the purchase of $2,000 worth of furniture had a 720.

Credit scores are vodoo bullshit that I will never understand and I imagine cannot be understood.

According to their literature, this card is actually designed to help people build their credit score. They report monthly to the three credit agencies.

I agree that credit scores are total BS. Your credit score will actually drop big time if you do not actively have loans or credits.

Two years of paying off a car on my own didn't raise my score would freaking bit, but it does show up on my credit report.

Last edited by dvdjunkie32; 11-15-10 at 05:23 PM.
Old 11-15-10, 03:42 PM
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Re: Finally Got a Credit Card!

Originally Posted by WallyOPD View Post
Actually, the masses are why you had the rewards to begin with. If everyone behaved "responsibly" in regards to credit cards, the rewards wouldn't be profitable.
Not to derail this too much, but profitability for credit card companies is certainly a function of card holders carrying a balance, but it's also a function of the fees charged to retailers who accept the cards. Those fees are generally always higher for rewards cards, so at least some of the cost of those rewards is passed to the retailers by the credit card company.
Old 11-15-10, 03:44 PM
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Re: Finally Got a Credit Card!

You have to time your payments perfectly.

That doesn't necessarily mean only pay by the due date. Naturally you want to do that.

Credit utilization is part of your FICO score. To determine your creditworthiness, creditors will examine the % utilization of your total available credit. If you are up near your limits, or even above 50%, you are a bigger risk and your score will go down.

On the other hand, if you have no debt and a ton of available credit, you are ALSO viewed as something of a credit risk. Because, and I'm not making this shit up, you run the risk of suddenly making HUGE credit purchases all at once and not being able to pay them back.

Carry small balances and pay them off over a few months.

Also: don't fall into the habit of using most of your available credit and paying it off in full every month. Ex: you have a $500 line and you charge up $400 a month, but pay off the full $400 upon receipt of your statement, and repeat. Credit card companies will report your timely payments, but they will also report your current and average balance of $400/month. Which means 80% credit utilization, which means lower FICO. Even though you pay it off monthly.
Old 11-15-10, 04:08 PM
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Re: Finally Got a Credit Card!

Originally Posted by Hokeyboy View Post
And your advice is incorrect. Showing a positive history of paying back secured debt on time is infinitely better than having no credit history at all, let alone bad credit.
I'm talking about credit history, not credit score. The number of times you applied for a card, the number of times your credit history was pulled, and the kind of credit you applied, these are all the information they keep in your credit history. When the company determine your credit worthiness, they first look at your score but your history is just as important.

Yes, as you start to build a credit history with this debt secured card your score will gradually increase. But nevertheless, when an actual human being is evaluating your credit worthiness, they'll take your history into consideration as well. Credit score is just for dummies who don't understand how credit works.
Old 11-15-10, 04:14 PM
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Re: Finally Got a Credit Card!

Originally Posted by Jacoby Ellsbury View Post
I laugh at the fools that don't earn cashback on their purchases .
cash back ftw.
Old 11-15-10, 04:22 PM
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Re: Finally Got a Credit Card!

Originally Posted by SuperJim88 View Post
I'm talking about credit history, not credit score. The number of times you applied for a card, the number of times your credit history was pulled, and the kind of credit you applied, these are all the information they keep in your credit history. When the company determine your credit worthiness, they first look at your score but your history is just as important.

Yes, as you start to build a credit history with this debt secured card your score will gradually increase. But nevertheless, when an actual human being is evaluating your credit worthiness, they'll take your history into consideration as well. Credit score is just for dummies who don't understand how credit works.
True but that's a far cry from
the fact that you applied for a secured credit card will make your credit history worst than it already is.
Secured credit is a sensible way to begin developing a credit history and developing smart spending habits. Sure, a credit pull with no history is a slight drag at the moment of application, but 6 months later with a solid payment history? He's infinitely better off than before.

And as far as "credit score is just for dummies"? Some lenders ONLY look at the numbers. Period. Just a fact of life.
Old 11-15-10, 04:56 PM
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Re: Finally Got a Credit Card!

Originally Posted by dvdjunkie32 View Post
I just find it so ironic that the system has rejected me completely because I am actually frugal with my money.
The system doesn't care if you're frugal, it cares of you're faithful to pay bills. That can be a function of your frugality, but it doesn't have to be. You can live well within your means but forget to pay bills all the time, which is at best, a hassle for someone expecting money from you every month. When it comes down to it, your credit score is ultimately a rough indicator of your potential ability to make agreed-upon payments (although I agree with everyone else that there is a lot of voodoo involved in the actual number).

I never liked the idea of credit. Buying something and paying later. I am too forgetful. I would lose track of my purchases and forget to pay the minimum. I didn't want to fall in the same trap that wiped out my brother and forced him to bankruptcy.
Everyone forgets to pay a bill now and again, but the kind of frequent forgetting that can send you into bankruptcy is a matter of irresponsibility, not forgetfulness. If receiving a bill isn't reminder enough to pay, then taking additional responsibility to set a regular reminder for yourself should not be too difficult.

I am old school. Save up your money, and then buy. I laughed at the masses throwing their money away paying interest.
It's actually very possible to build good credit without ever paying "bad" interest.

I had to get my parents to cosign so I could get a phone and buy a vehicle.
This should not be surprising. No matter what age you start building credit, it pretty much always has to start with a co-signer who has established credit.

Even after paying off the car on time, my credit score still didn't go up!
That's part of the admitted voodoo, because there's much more to it than just opening a single line of credit and making your payments

Just boggles my mind that these companies will hand out CCs to school kids like candy yet even with a stable income, I am deemed a higher risk.
No "school kid" who is a minor has a credit card of their own. They are just secondary cardholders on their guardian's card. If you're talking about college kids who are 18 or older, they didn't start building their credit without a co-signer. And as I alluded to before, the amount of income you have is not a direct indicator of how good you are at handling money or paying bills on time. That's really what matters to institutions checking your credit score. It all pretty much makes sense when you step back and look at it (except for the nitty-gritty details of how your credit score is calculated...that is mind-boggling).
Old 11-15-10, 05:26 PM
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Re: Finally Got a Credit Card!

Originally Posted by Hokeyboy View Post
True but that's a far cry from

Secured credit is a sensible way to begin developing a credit history and developing smart spending habits. Sure, a credit pull with no history is a slight drag at the moment of application, but 6 months later with a solid payment history? He's infinitely better off than before.

And as far as "credit score is just for dummies"? Some lenders ONLY look at the numbers. Period. Just a fact of life.
I tried to get a credit card through my local bank. I argued that I had done business with them for over 10 years, and my balance never once overdrafted.

They told me that the credit score is the only thing they look at and consider.
Old 11-15-10, 05:46 PM
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Re: Finally Got a Credit Card!

Congrats, dvdjunkie. You've finally earned enough money to be in debt for the rest of your life.
Old 11-15-10, 07:45 PM
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Re: Finally Got a Credit Card!

I got an AMEX card when I was 18. That turned out to be a really bad idea.
Old 11-15-10, 08:23 PM
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Re: Finally Got a Credit Card!

Originally Posted by kefrank View Post
Everyone forgets to pay a bill now and again, but the kind of frequent forgetting that can send you into bankruptcy is a matter of irresponsibility, not forgetfulness. If receiving a bill isn't reminder enough to pay, then taking additional responsibility to set a regular reminder for yourself should not be too difficult.
No kidding. Not to be harsh, but that's a silly excuse. How would you ever manage to pay any bill or even survive if you're that forgetful? Especially since you can get a paper bill and multiple electronic alerts.
Old 11-15-10, 08:56 PM
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Re: Finally Got a Credit Card!

Originally Posted by kefrank View Post

Everyone forgets to pay a bill now and again, but the kind of frequent forgetting that can send you into bankruptcy is a matter of irresponsibility, not forgetfulness. If receiving a bill isn't reminder enough to pay, then taking additional responsibility to set a regular reminder for yourself should not be too difficult.
for me, i set up all my CC's to automatically pay the min. balance, so even if i forget to pay the bill, it's still not a late payment. i'm sometimes careful not to pay the bill in full because it can affect my chargeback rights under certain situations.

Originally Posted by Jacoby Ellsbury View Post
I laugh at the fools that don't earn cashback on their purchases and pay for their items immediately rather than letting your money sit in the bank for another month earning interest(it hasnt always been sub 1% interest rates at the bank) and then paying in full a month later. I get 5% back on gas, grocery and drug store and anywhere from 1-3% back depending what card I use on everything else. But yeah the masses you laugh at are the reason we have this financial reform BS and the reason a lot of my rewards will be going away.
i use CCs for this reason too. using certain cards, you can get additional cashback, like with discover, you can use shopdiscover to get up to 20% cash back.

also, i have opened cards for promos like when they say, open a card, use it within XXX days, and we'll give you $200 (or whatever) or open a card, we'll give you a free ipod. as always, be careful, because you don't want to do it too much, it'll show you have way too many cards.

also, there are perks such as free extended warranties, rental car damage waiver, lost luggage reimbursement, replacement of items if stolen under certain conditions...
Old 11-16-10, 08:51 AM
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Re: Finally Got a Credit Card!

Originally Posted by fumanstan View Post
No kidding. Not to be harsh, but that's a silly excuse. How would you ever manage to pay any bill or even survive if you're that forgetful? Especially since you can get a paper bill and multiple electronic alerts.

Well that excuse a reality when you consider just how many people are living in debt due to credit card abuse. It gets really messy when you have people using credit cards to pay off the interest on another credit card.
Old 11-16-10, 09:00 AM
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Re: Finally Got a Credit Card!

Originally Posted by kefrank View Post
Not to derail this too much, but profitability for credit card companies is certainly a function of card holders carrying a balance, but it's also a function of the fees charged to retailers who accept the cards. Those fees are generally always higher for rewards cards, so at least some of the cost of those rewards is passed to the retailers by the credit card company.
This isn't really true. Only two companies both issue credit and own payment networks: AmEx and Discover. The largest issuers (Citi, Chase, CapOne etc) don't own networks and use a variety of acquirers and networks to interface with merchants and process payments. These issuers get a small cut of the fees charged to merchants by the networks ("issuer interchange", maybe 50bps on each transaction), but it represents a very small item on their P&L, certainly dwarfed by finance charges. AmEx and Discover make more money as they outright own the network, but the revenue is still dwarfed by finance charges.
Old 11-16-10, 10:20 AM
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Re: Finally Got a Credit Card!

Originally Posted by dvdjunkie32 View Post
Well that excuse a reality when you consider just how many people are living in debt due to credit card abuse. It gets really messy when you have people using credit cards to pay off the interest on another credit card.
That has absolutely nothing to do with saying that you'll forget to pay bills.

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