Stressed: I need Advise on Credit Issue

Discussion in 'Community Discussion' started by macswitcha2, Feb 9, 2010.

  1. macswitcha2 macrumors 65816

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    #1
    To put it simple...I have no credit....I only own a bank/debit card. That means I pay for everything I own via cash, check or debit. I have purchased my iMac, Macbook, iPhone, and other items via debit card. I have never charged anything with a credit card.

    However, I want to one day buy a new/ certified used car and a home, to do that I would simply need credit.


    I have continuously been denied credit therefore I have stopped even applying since I have heard that history of being denied will show up on a background check and this too will interfere with getting credit.

    I was even denied a secure credit car from Bank of America.

    Does anyone know a remedy? I simply need a credit card to show that I can manage my money wisely. How can I establish credit if I'm never given a chance?
     
  2. GoCubsGo macrumors Nehalem

    GoCubsGo

    Joined:
    Feb 19, 2005
    #2
    Typically you don't get denied a secured credit card. Something must be genuinely wrong. Do you have a job? How old are you?

    I would hit up a department store, Target, Best Buy, etc. You are right to be frustrated because bad credit is very much like no credit in some ways. Your other alternative is see if you cannot get on a card with a parent but be sure they see you are a responsible party which means they report to the credit bureaus.
     
  3. yg17 macrumors G5

    yg17

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    #3
    I would get a copy of your credit report ASAP and make sure you haven't been a victim of identity theft. Getting denied for a secured card? Something just doesn't seem right.
     
  4. renewed macrumors 68040

    renewed

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    #4
    What type of credit cards are you applying for? Are you applying for ones that you will qualify for?

    If you are a student.. do a search for student credit cards. These are often easier to get than most.

    Another credit card that is often easy to get is a gas card such as a Shell card or the like.
     
  5. macswitcha2 thread starter macrumors 65816

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    #5
    I'm an adult. Currently I'm unemployed as of December, laid off; I was a teacher working at a struggling private school.

    I manage money well therefore I have some money saved and I'm sending in my resumes at employment opportunities that interest me. I'm currently a full time grad student. Even through undergrad I was mailed credit card applications but stopped applying because I got tired being turned down.
     
  6. renewed macrumors 68040

    renewed

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    #6
    If you are getting denied in this circumstance I would try to check your credit as stated above and check for identity theft.
     
  7. macswitcha2 thread starter macrumors 65816

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    #7
    Yeah...I am looking online for free credit reports.

    Thanks.. since I'm currently a grad student, I will look into student cards...never heard of them.


    Yeah! Checking into this...any recommendations?


    Note: But I have been approved for school loans which is odd. My student loans are all in good standing since they're deferred.
     
  8. renewed macrumors 68040

    renewed

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    #8
    Student Cards



    Check your credit. You can check it yourself without penalty to your credit.

    Equifax

    Experian

    Transunion
     
  9. Ttownbeast macrumors 65816

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    #9
    If you owe nothing you are worth nothing that is the best spot to be in don't put that kind of price on your head--take advantage of it by continuing such good habits.
     
  10. rhsgolfer33 macrumors 6502a

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    #10
    You might try Capital One, if you already haven't. A few years ago when I wanted to start establishing credit they gave me a card (I had zero credit and a pretty low income). Of course, credit has tightened a lot recently, but it is worth a shot.

    Definitely check a credit report, it is very odd that you're being denied for a secured card.

    There is no reason he can't continue those habits with a credit card. I've had a card for three or four years now and have never paid a dime in interest or fees. I use it like I would a debit card and pay the balance off in full every billing cycle. I'm establishing credit that will help me when I want to buy a new car or a house (hell, employers even check credit reports in some cases) and it isn't costing me anything.
     
  11. renewed macrumors 68040

    renewed

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    #11
    And pay cash for a house and car? Even a lot of renting requires credit today.
     
  12. Ttownbeast macrumors 65816

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    #12
    renting looks for 2 things criminal history and on time payments that is not credit but it is in the credit record--it is still entirely possible to pay for anything in cash (paper or electronically) people are just led to believe that it is not...there is no law against paying in cash when you have enough of it. Just remember to ask for signed reciepts.
     
  13. renewed macrumors 68040

    renewed

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    #13
    And if he has no credit record... :rolleyes:
     
  14. bradl macrumors 68040

    bradl

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    #14
    Another thing to think about.

    If you were a teacher, you should at the least be able to qualify for membership at a local credit union. My mother is a member of one, just by virtue of there being one just for teachers in her school district, but others may have different requirements. Mine just requires being a resident of my county or having a job in my county. I would try there before going to any bank.

    Also, there are disparaging differences between banks and credit unions: FDIC vs. NCUA. Banks work in the best interests of their shareholders; credit unions work in the best interests of their members. You may find yourself qualifying for things based on your credit, age, location, etc. just by being a member of that credit union. Plus, they'll offer workshops on how to build exactly what you're looking for.

    Definitely try to apply for membership at a credit union first before the banks. You may find better chances there.

    BL.
     
  15. GoCubsGo macrumors Nehalem

    GoCubsGo

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    #15
    Student loans aren't like regular loans really. They will approve you if you have no credit. What is odd is that you're not benefitting from these loans. However, if they're all still deferred then it likely means little.

    The bigger issue is that you owe more than you make. Even if you appear to owe nothing on your credit report you likely live somewhere and have some expenses, right? You make no money, this is a tough one for people who are trying to see if you're able to repay a debt.

    This is just misguided. Having some credit that is good can be very beneficial.
    Exactly, suggesting that you pay cash for a house is plain stupid. Sure, we'd all like to do it but even with homeownership the tax benefits are great for the first few years. Best take advantage of that of course.
    Leasing agents look for credit in general. What do you owe versus what you make (DTI) and what do you owe and have how you paid (ability and intent to repay debt). No one is suggesting that you shouldn't pay cash for things but again, having some history of credit and showing credit worthiness is important.
     
  16. yg17 macrumors G5

    yg17

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    #16
    Credit cards offer many benefits over cash and won't cost you a single dime if you do it right.
     
  17. Ttownbeast macrumors 65816

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    #17
    No leasing agents do not, I spent a long time in that field they look at the direct risk of a person not paying rent on time. They do not give a damn about what is owed or what a persons income is but whether or not the payments have been made consistently. Cash counts in the rental business and gets reported to credit agencies on a regular basis as payments made--cash or credit money is money to the land lord and always counts as a positive when taken in on time. Lawyers for property management companies always call former landlords and independent land lords always call former properties for references concerning financial matters rather than rely directly upon credit agencies "general" data.

    Any property managers who fail to follow these procedures do not tend to last very long in the field.
     
  18. Ttownbeast macrumors 65816

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    #18
    I'll agree there but the right thing is avoiding taking out credit completely, what good is using money you don't really have?
     
  19. rhsgolfer33 macrumors 6502a

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    #19
    No, its not. Avoiding taking out credit completely can cost your a lot more than taking it out and being responsible with it. Ultimately, if you ever want to own a home you will, more than likely, need to take out a loan. Not developing credit via things like credit cards or auto loans will almost certainly mean you'll either not be able to get a loan for your house or you will have an astronomical interest rate. If you're careful with your credit, you will save you a lot of money in the long term when you're able to get lower interest rates on large purchase that essentially (for the overwhelming majority of people) require a loan.
     
  20. yg17 macrumors G5

    yg17

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    #20
    You don't have to use money you don't have just because you use a credit card. If I don't have the money in my bank account right away, I don't charge it to my credit card. It's as simple as that. But in the meantime I'm building up credit for when I want to buy a car, I'm getting the fraud protection benefits of a credit card and I'm getting rewards back which is basically free money from my bank.
     
  21. Ttownbeast macrumors 65816

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    #21
    That is a myth. It is fine to trust credit for some things but credit is not religious cannon--cash still has a voice.
     
  22. rhsgolfer33 macrumors 6502a

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    #22
    No, its not. If you have little or no credit, you will have a higher interest rate, guaranteed (provided you can even get a mortgage loan).

    A person with good credit and a 20% down payment will receive a better interest rate than a person with little to no credit and a 20% down payment. The vast majority of Americans purchase a home with a mortgage; it is in their best interest to establish good credit and save a minimum of a 20% down payment in order to get the best interest rate possible.

    If you don't have credit you are simply considered a riskier borrower and you're interest rate will go up. Even a .25% or .5% increase in your interest rate can cost you a lot of money when you're purchasing a home. It is best to make sure you have a good down payment, a high credit score, and a low debt to income ratio before you go to get a home loan.
     
  23. yg17 macrumors G5

    yg17

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    #23
    You're not going to get credit to buy a new car or home if you don't have any credit. Or if you do get a loan, it will be at an absurdly high interest rate.

    Getting a credit card and using it wisely is only going to save you money in the future when you buy a car or house.
     
  24. dukebound85 macrumors P6

    dukebound85

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    #24
    Wrong

    If you treat your CC like a checkbook, you will do nothing but better yourself

    Many things require credit...cars, homes, loans, etc

    To willingly not have credit is foolish

    If you think and treat CC's as money you dont have, you don't understand how they work
     
  25. yg17 macrumors G5

    yg17

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    #25
    Also try to do simpler things like rent a car or get a hotel room with cash. Good luck.

    And don't buy a plane ticket with cash either unless you want a cavity search at the airport. One of the failures that took place in the crotch bomber incident was that he paid for his ticket in cash and wasn't subject to any additional security checks because of that, paying cash for plane tickets raises red flags all over the place.
     

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