How do i establish good credit? im 18 and dont have a credit card, bank account, car.....how do i start?

Question

I do have a job.....and im on my own now...in a few months i want to buy a car but dont know how i would do that without ANY credit.........???

so if not a credit union, what bank would be a good choice....

in my area we have several local banks and then the usual, Bank of America, Wells Fargo, WaMu...etc

Answer 1

No Credit? No Problem. Here Are Some Tips to Help You Establish Good Credit
When you don’t have a credit history, it can be difficult and frustrating when trying to obtain a credit card or other type of loan. Establishing your initial credit history can be a Catch-22. If you don’t have credit, not many places are willing to give you credit, yet how can you ever establish credit if nobody is willing to give you any?

Understand What Lenders Are Looking For
Since you are looking to establish credit for the first time, lenders can’t look to your FICO score to determine whether or not to lend you money. In these situations they have to examine other factors that can help them decide if you are a credit risk or not.

Bank accounts. You don’t need a credit score in order to open a checking account at your local branch.

Since it doesn’t require credit to open, it also doesn’t get reported to the credit bureaus to establish any credit. Even so, your account history can be a vital component when lenders consider giving you a credit card or loan for the first time.


Employment history. Another important factor lenders look at is your employment history. They want to see if you are able to hold a job or if there are periods of unemployment. Your ability to hold a steady job can improve the likelihood of getting approved.


Residence history. Lenders will also look to see how often you move and whether you rent or own. As with employment history, it pays to have a stable residence. Owning a home, even if just jointly with a spouse, carries some weight as well.


Utilities in your name. Even without a credit history, it is possible to sign up for many utilities in your own name. Having an electric or gas bill, telephone, cable, or water service in your name also helps. Just having your name on these accounts won’t establish a credit score, but it can be helpful for first-time borrowers.
Start With Your Bank
There are a few things you can do that can help in your quest for establishing credit. The first thing you should do is open and maintain a checking and possibly even a savings account at a local bank. This is helpful in two ways:

When you have active bank accounts in good standing, you are proving that you can manage money. While bank accounts aren’t typically a part of your credit score, lenders can use this information to determine whether or not you are a credit risk.


Establishing a relationship with a bank will improve your chances in obtaining a loan or credit card through them. If you already do business with a bank, they should be the first place to look. They know you and they value your business. This existing relationship should carry some weight when seeking credit.
Consider a Department Store Card
You’ve probably been shopping at the mall and been asked if you’d like to sign up for their store credit card to save 10% on your purchase, but politely declined. Generally, store cards are a bad idea because they lure you in with that up-front discount, and then the ongoing interest rate is very high.

Avoiding these cards is typically a good idea, but the ease in obtaining one may actually be a good thing if you’re having trouble establishing credit. If you have struck out at the local bank, you may want to consider checking with one of the local department stores and see what type of cards they offer. Whatever you do, make sure you find out whether or not they report to the credit bureaus. If they don’t, it will do you no good.

If you are approved for their card, you need to be disciplined and use it properly. Don’t treat this new purchasing tool as free money, but only as a means to establish good credit. The limit will probably be low anyway, but you should make an initial purchase with it and subsequently pay the balance off in full. Once the card is active, it should begin to be reported to the credit bureaus. It is now important to maintain a good payment history on this card so your credit history can build upon it.

When All Else Fails
If you’ve tried the bank, department store, or even credit card companies directly and failed, not all is lost. Secured credit is a last resort, but it is much easier to obtain than unsecured credit.

When a credit card or loan is secured, it means that there is an asset linked to the account that the lender can take if you fail to make payments. When you have a mortgage or auto loan, these are secured loans. If you fail to make payments, the lender will take your house or car in order to satisfy the debt.

You can establish the same thing at most banks with a secured credit card. You can pledge money you deposit in an account to secure the credit card. For example, you could obtain a secured credit card with a $500 limit if you put a $500 deposit in the bank that is linked to the card. If you fail to make your credit card payments, the bank takes your deposit.

Again, you want to check and be sure that this secured credit is reported to the credit bureaus, but if so, this can be a useful tool to establish that first piece of credit history. After you maintain that account in good standing for a while, you may be able to obtain a regular credit card or loan.

Establishing Credit is Only the First Step
Establishing a good credit history takes time. There are no shortcuts or tricks that can take you from no credit at all to a high score in a matter of months or even a few years. Your credit score is based on a number of factors such as payment history, length of time you’ve had credit, and much more. So, while it is important to initially establish credit, it is even more important to take the time to do the right things to maintain good credit.

Answer 2

Really, being a student is the best way to get credit established. All the major credit card companies have programs set up for offering credit to college students that have no credit history. Also, if that's not your situation, usually someone like Sears, JC Penney, or other department stores are pretty flexible about letting you get a store credit card without having a lot of previous credit established. You might also try gasoline credit cards, but I think most of them don't exist anymore. Finally, a warning: be careful about establishing credit jointly with someone like a parent. It could work well, but it also could backfire. I had a friend who tried to do that, and his mother ruined his credit by misusing the account and then not paying on it when she promised to. Any kind of joint credit is risky, even if you know the person is trustworthy, because even the nicest people have fallen on hard times, and there's no telling what could happen. Best of luck to you. P.S. Having a good credit history is not nearly as important at your age as having a good investment strategy. Don't get caught up in the borrower's culture. Be an investor instead!

Answer 3

First open a checking/savings account. You mentioned Wells Fargo Bank. I've dealt with them since I was 17 and I'm now 20. They are a great bank and I've never had one single problem with them. You can also open up a secured credit card with them too. What you do is open the credit card, deposit money (300 or so) and that will be your credit limit. When you use the card they will send you a statement with a payment due. Just pay the payment and you'll start noticing an increase on your credit score. Wells Fargo requires a minimum $25.00 to open an account.

Answer 4

Open a checking and savings account. Save your money. It would be easier to buy a cheaper car with a larger down payment to get financed. When I bought my first car I had a down payment and they need either 400 more dollars than what I had or a co signer. Do you have a credit union where you work? If you join one of them through work it is easier to get a loan from them. With the bigger down pay they figure that you have more at stake and are more likely to repay it. NEVER RUIN YOUR CREDIT. Everyone looks at that these days. Insurance companies, some employers, all landlords and all utility companies. Once you ruin your credit it takes a while to fix it. You can get cheaper rates on insurance and a job sometimes over someone that has bad credit.

Answer 5

First go open a checking and savings, they only require about 50 dollars each to open, then while you are at the bank apply for a credit card as well, usually they will give you one. Go to Chase if that is in your area, my first credit card was from Chase. The credit limit is going to be small (anywhere from 200-500 dollars) But, as long as you use it responsibly (Don't ever spend more than 30% of the total credit line, for example...a 1000 dollar credit line, never go over a 300 dollar balance) always pay on time, and don't apply for a bunch of credit cards at one time. After you have about 1 year of history, I would look for a better credit card offer that will give you a higher limit and a better interest rate (your first credit card is going to have outrageous interest rates) Goodluck!

Answer 6

Your best bet is to go score a few store credit cards like JC Penneys, Sears, and so on. Charge some stuff, *and pay it off on time*. Do that for a few, then apply for a low credit line Visa from someplace. Use that to charge stuff, *and pay it on time*.

If there's any credit unions in your area, those are often good places to land a Visa or similar with low interest rates.

Answer 7

If you have a job you could apply for a credit card.

Do not max it out!

If possiblem pay off the entire balance every month. A history of on-time payments is the best way to establish a good credit history.

Answer 8

Actually buying a car is a good place to start. Another option is a department store card or a gas card; pay it off every month and you'll begin to establish credit.

Answer 9

You need to establish both savings and checking accounts. These two things will be able to show how you handle money and a vehicle will be expensive, so start a good budget. As soon as you're able, find a financial advisor who deals with people who have small accounts. Stay away from the big guys, they'll eat you up in fees, and rarely call you. But the guys who handle small accounts are in it to help people and they tend to love what they do!!! Good luck.

Answer 10

You may want to save some money and put that with a tax check and start with a down payment on a buy here pay here car lot for your first car and not get into any dept until you get wiser .