I do not have a credit. Who will allow me to open an account to begin to obtain credit?

Question

I need to create and obtain a credit score.

Answer 1

In my line of work I am always having to explain to people how to
properly use their credit cards so as not to negatively affect their
credit score. So for this answer we are going to
discuss how to apply for a credit card and how to properly use them to
accellerate your credit score up into the 720's and above. As you are
probably aware, those who have a credit score of 720 or greater are
considered "Jesus Walking on Water" to creditors (or whatever Higher
Power you believe in).

First let us assume that you have had a job for more than six months and your credit score is not in the "A Paper"
range (667 or higher). You are probably inundated daily with junk mail
and junk email offers for credit cards. These offers range anywhere
from secured cards that require you to maintain a certain balance on
your card in order to use it to offers of 0% interest for x numbers of
months rising to as much as 29.9% after that period. Some of these are
scams and others are legitimate, albeit expensive, offers. Let's first
examine the offers that require you to maintain a balance.


It is usually not a wise decision to accept offers of this kind. These
offers require you to send in a certain amount of money (let us say for
purposes of this article $300) that is the "credit balance" available
to you. In other words, if you send them $300 you should have a credit
limit of $300, right? WRONG! Most people don't read the fine print on
the reverse side of these credit offers. There is usually an account
setup fee, a maintenance fee, a membership fee and sometimes (believe
it or not) a low balance fee if your credit balance drops below a
certain level. This is a scheme they have borrowed from Credit Unions.
Usually what happens is that you send in your initial $300 from which
they deduct the activation fee, maintenance fee and membership fee.
These fees often add up to more than your initial $300. So now you are
hit with an over the limit fee and that low balance fee. Now, before
you have even had a chance to use your new credit card, you owe them an
additional sum of money beyond the $300 you sent in to start the credit
line.


No problem, you say. Live and learn. At least I am only out $300 and
I will cancel the card and walk away wiser. Remember that fine print?
In that fine print that you did not read, there is often a clause which
reads that you have to maintain the card with minimum balance for at
least one year. And don't forget that you are already over your limit
so you have to make up that balance as well as another $300 to maintain
your balance. So you say, fine, I will send in the money and just not
use the card. When your next monthly statement arrives, you find that
you are again below your minimum balance because of the monthly fees.
So now you have to send this company money each month to maintain a
card that you cannot use. And for a year you are stuck doing this
because it is cheaper to do so than it is to hire a lawyer to fight the
scandelous fiends. Finally your year is up and you cancel the card
expecting your $300 back. You will never see it. It goes to your card
cancellation fee which will somehow be exactly whatever the balance
remaining is after their monthly fees. Funny how that works, isn't it.
I hope you never get caught in a situation like this.


Now let's look at the pros and cons of the legitimate credit card
offers. You get a bunch of these also. They say that you can start a
line of credit because you are already pre-approved. They will set you
up with a line of credit ranging from $300 to $5000. Of course you are
interested because $5000 dollars is a lot of money to have available to
you. So you fill out the application and a couple of weeks later you
receive your new credit card with a $300 line of credit. You are
obviously disappointed. The $5000 dollar line was never really
available to you. That is just a marketing scheme to get you to apply.
Hell, I have fallen for that one myself. But $300 is better than
nothing. And chances are that if you are wize and handle your credit
correctly, that limit should start to rise in a few years. This is a
great place to start to improve your credit standing.


So what is the first thing you do? You go out and buy that $250 widget
you have always wanted because you can buy now and pay later. You get
your monthly statement and you say, well I will make the minimum
payment. This is fine because the credit card company will report you
as "paying as agreed" to the credit reporting agencies. This is good,
right? WRONG! The moment you go 50 cents over 1/2 of your credit
limit, your credit score starts to DROP! Even though you are making
your payments on time, every month that you maintain a balance that
exceeds 1/2 of your limit, your score goes down. So it is wize to
remember to STOP using your credit card when you are at 50 cents BELOW
1/2 of your limit. This will keep your score from dropping and as long
as you continue to make your payments on time, your score should rise.


So you opted to get this card because they promised you 0% interest for
nine months! This is great! Nine months that I can borrow money for
FREE! Now let's look at what happens in month ten. Your interest rate
skyrockets to 20%! Now when you make those minimum payments, most of
the money is going to interest and very little is going to principle.
And if your balance is at or just below 1/2 of your limit, the interest
charges can put you over that 1/2 mark and your score starts to drop.


No problem, right. You will just apply for this other credit card that
is offering a 0% interest for nine months and transfer the balance.
This seems like a reasonable thing to do. Now you have extended the
amount of time that you can borrow money for free to 18 months. You
pat yourself on the back for your ingenuity, as well you should. So
nine months later, you do the same thing again, transfer the balance to
card number three. This is so successful that you decide to do it yet
again, a fourth time. Then you notice that your credit score drops.
Why? Because you have more than three credit cards. This will also
cause your credit score to plummet. The reason for this is that it is
assumed by the creditors of America that if you have more than three
credit cards you are a credit bandit (I will explain this in a future
article).


You should consider all this as you are applying for credit cards.


1) Are they requiring me to pay for my credit limit? If the answer is
yes, then wait until you get an offer from a reputable credit card
company such as Capitol One or Discover.
2) What are the anual membership fees? If you are not ok with the
amount they are charging for the anual fee, then just wait, another
offer will be coming along tomorrow.
3) What is the interest rate after the initial 0% period? It is
unlikely that you will get an interest rate of less than 19.9% if your
credit score is under 660 so just take what you can get and understand
that you are only using this credit card until you can get your score
up to "A Paper" rating when you will qualify for the 3-5% interest
rates. Remember to cancel your high interest credit cards BEFORE you
send in your applications for the low interest cards. This will help
prevent a serious drop in your credit rating score.
4) Keep your active credit cards to three or less.
5) When using your credit cards, keep your balance LESS than 1/2 of
your credit limit.
6) ALWAYS make your payments on time. And pay more than the minimum
whenever you can.

If you have any questions about your credit issues please feel free to email me at [e-mail]

Answer 2

start off with a gas card or a department store cc and work your way up from there

Answer 3

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Answer 4

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Answer 5

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