I am 19. I have no credit. My first job was at Walmart, part-time for only 5 months. I go to school on a full-ride scholarship. I live with my parents. I was wondering how can I get credit? I heard about going to furniture stores and paying them on time is good. Can getting a federal student loan from the government establish credit history?
2007-01-01 17:45:17 · 7 answers · asked by filberttapaha 2 in Business & Finance ➔ Credit
Yes, student loans do establish credit history. It won't establish your credit until you start paying the loans back. If you get the payments deferred, like many people do, it will show on your credit, but it won't really help you establish credit, because you aren't actually making the payments.
You can go to furniture or jewelry stores and open up an account, but you'll have to have a job to get an account.
2007-01-01 18:08:36 · answer #1 · answered by kelly h 3 · 0⤊ 0⤋
Get a credit card. If you are in college you'd get flooded with credit card offers. Just accept one with like maybe $1000 credit limit, and tear up the rest. Then setup an automatic payment plan (I hope your bank offers eBills and eBanking) so it gets paid automatically every month. That will start your credit history.
The student loan doesn't really count as practically every student gets that, and quite a bit of the loan is actually on the parents, not the student, but we'll leave that aside.
Remember to spend a little every month on the credit card, maybe even every week or so. Maybe pay with a meal or two with credit card, or do your entertainment expenses with credit card. You should already be putting money aside, but instead of going to ATM and get some cash, leave the money in the bank, use credit card to pay, then have ePayment from bank pay it automatically. You know what you can afford, so don't go overboard.
2007-01-01 18:02:32 · answer #2 · answered by Kasey C 7 · 0⤊ 0⤋
You can get a credit card with a low credit limit e.g. from credit unions if you have an account with them.
Doesn't matter if the credit limit is very low, they only want to see a track record of timely payments.
Remember to keep the balance-to-credit limit low, always <33%.
So never ever max it out or go above 50%! That damages your credit rating.
Don't ever borrow on it (obviously). Just make some small purchases. Increase the credit limit only as needed. And don't carry it around in your wallet.
Try to avoid subprime lenders like Capital One that make a living crucifying people with multiple card fees and teeny limits on each card.
If you must take a subprime credit card, MBNA (say) is better.
2007-01-01 17:56:25 · answer #3 · answered by smci 7 · 0⤊ 0⤋
If your federal loan is unsubsidized, meaning you are responsible for your interest. What you can do is make interest only payments on the loans until you graduate, it will really build your credit as long as you make the payment on time. My daughter is 22 years of age and has a credit rating of 716, which is really good and the only thing on her credit are these loans. Good luck!
2007-01-01 19:29:20 · answer #4 · answered by frr_ls 2 · 0⤊ 0⤋
Yes it does establish history, but not positive history untill you start to pay it back.furniture stores along with electronic stores would be a good start,providing you have a job.
2007-01-01 17:52:25 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Ask the financial Aide branch on the college you want to attend. they are able to tell you precisely what you may qualify for, or what kinds to report to make certain. take it sluggish and try this.
2016-10-19 08:34:12 · answer #6 · answered by ? 4 · 0⤊ 0⤋
Yes it can. And for most people it is bad.
M
2007-01-01 17:47:37 · answer #7 · answered by maamu 6 · 0⤊ 0⤋