when does credit begin?

Question

People say when youre 18 because you cant open a checking account until that age. However I have washington mutual, who makes exceptions if youve got a job, etc. Ive overdrawn a couple times. Has my credit started, or do i still have until i turn 18?

Answer 1

There are three credit reporting agencys. TransUnion, Equifax, and Experion. Credit is built and reported on Debt such as auto, home, personal loans, and credit cards but not checking account history. The exception that might be if you bounced lots of checks and the bank took you to court where you recieved a judgement saying you had to pay back an amount. Only the judgement would show. Credit is reported monthly by those institutions who lend money. DON'T be late in your payments. If you are late you will receive a late payment fee but if you can get that payment in before your next one is due, it won't be reported negatively on your credit. Bankruptcy is a LAST resort. Like amputating a limb. Its on your report for 10 years. Judgements and settlements for 7 years. Credit couseling agencys are garbage too because they will essentially not pay anyone you owe to try and get them to settle the account for less. All the while you are taking hits to your credit.

Protect your credit at all costs cause you'll need it a lot later. Credit builds like a snowflake that turns into an avalanche. I started when I was 16 with a credit card my parents signed for that had a $500 limit. Make at least one charge a month and pay it off if you can but MAKE A PAYMENT. Stay away from the credit cards offered by department stores for 10% off if you sign up today. Lots of cards will hurt you. You need no more than 2 cards ever. Don't cancel cards cause the agencys see this as your inability to handle credit. Just stop using them if you already have them.

The short list of things to do is:

Get a credit card even if its begining balance is small.
Pay it off each month if possible but make a payment.
Don't over extend yourself.
LAST LAST LAST resort is credit couseling and bankruptcy.
If you don't know then ask.
Protect your credit at all cost. (but dont kill anyone)

Answer 2

You have until you turn 18 since most companies cannot enter into a contract with a minor, so if you were to overdraw on your account, the bank cannot collect from you, but if your parent is on the account, your parent will be liable.

However, if you wish to obtain credit from your present bank once you turn 18, you will probably want to show them how responsible you are now. My daughter is 16 and has a checking account ... she has never overdrawn her account ... she's had it for some time now. Banks monitor these accounts. Once she graduates from college, she could very well apply for a loan with this bank and they will look at how long she's had her account, how she's managed her account, and determine if she is a good risk or not ... if she shows them that she's responsible, she could possibly get a loan right off the bat. Of course, her account is with a smaller, local bank. People at many of the different branches recognize her. I told her that the decisions she makes today affect her financial state in the future, whether it be managing her money effectively or finishing college.

Answer 3

When you are 18, in the US, you are an adult and can sign contracts, etc. Anyone can have an account, and yes, your account feeds into your credit score. Being overdrawn does not affect your credit score. Missing a payment does though if you owe something. Having an income does, if you have a job.

Answer 4

You're bank account doesn't matter, unless of course it's extremely overdrawn for all long period of time & the bank reports it to a collection agency. Other then that, you have to earn good credit. Good luck on that! Many creditors don't want to credit people without credit.

Answer 5

Overdrawing on an account doesn't affect your credit unless you don't pay it. But its probablly not a good start...try your hardest not to over draw. When you turn 18 don't get tons of credit either. It will be the worst mistake ever. Get a cell phone and pay on it every time on time. Things like that will build your credit.

Answer 6

If you are a delequent on your checking account on overdrawing, that bank might report it, but most likely they won't.

Making payments on things, such as a car, cell phone, pretty much everything you make payments on.

U r 18 and you have plenty of time to get your credit built up.

When you get a credit card, make sure they give you a low APR and no annual fees.

GL

Answer 7

I got my first credit card when I was 16.
Because I had a job.

I'm assuming from the moment you sign contracts stating you'll pay on time n stuff.

But bank withdrawls only hurt your reputation with your bank not your overall credit.

Answer 8

In the US, negative information must be removed from your credit report after 7 years. Aside from that, there is no such thing as a beginning point for your credit history.

Answer 9

Your credit starts as as soon as you put money into the economy.