Obtaining Your First Credit Card to Build Credit

One of the first steps to establishing good credit is to obtain a credit card. There are many different types of credit cards available for all sorts of situations. Here are some of the most common types of cards. Of course, proper credit management is a must to maintain a good credit rating.

 

Four Ways to Get Your First Credit Card

 

 

 

1. Go to your local bank that holds your checking or savings account
   

   If you have an established relationship with your bank you can try applying for a card there. Talk to your local branch manager about opening your first credit card. Having already established a relationship here will improve your chances.

 

 

2. Credit cards for students
   

   If you are enrolled in college you, you have a very good chance of getting approved for a student credit card. Credit card companies are known to prey on college students so be careful and start with only one card no matter how many offers you get.

 

 

3. A gas card or department store credit card
   

   These types of credit cards usually have easier approval. This can make getting your first credit card less complicated. Be responsible with these types of cards because they tend to have high interest rates that make it expensive to carry balances.

 

 

4. A secured credit card
   

   When you are starting out and you have no credit history to qualify for one of the traditional credit cards you can apply for a secured credit card. With a secured credit card, you make a deposit against the credit limit of the account. The bank holds the deposit in case you don’t make your payments as agreed.
   

    

How to fix a bad credit report

 

The specific steps to clean up credit depends on what’s on your personal credit report. Before you can start your credit clean up, you must first get a copy of your credit report and review it for all negative credit items. When you receive your credit report you should also receive an explanation of the things that are negatively affecting your credit.

 

 

Most common credit report blemishes and how to correct and remove negative credit.

 

 

Incorrect information that is on your credit report.

Incorrect information is the easiest thing to correct. Administrative and clerical errors can lead to errors on your credit report. These errors could be hurting your credit in a negative manor, so do not overlook these. You should always send out a credit report dispute to have inaccurate or incorrect information corrected or deleted.

 

Collection accounts, charge-offs, late payments and past due accounts

Your credit payment history will have the biggest impact on your credit score. Late payments (Delinquent accounts) will hurt your credit score more than anything else. Get current on your delinquent accounts ASAP. 

You can negotiate with creditors and debt collectors to remove negative information from your credit report. They do not have to comply but you will never know until you attempt it.

 

 

High credit limits and over-the-limit balances

The second biggest factor in calculation your credit score is your outstanding debt. The balances you carry on your credit cards and other revolving debts could have a negative effect on your credit rating. Ideally, your credit card balances should be at or below 30% of your credit limits to have the highest possible positive impact. You must be very responsible with your credit and keep good tabs on your balances to maintain a good credit score.

 

Unpaid judgments

To be blunt, you must settle these judgments or they will continue to have a very negative affect on your credit report score. 

 

Student loan default

The most important thing to do here is keep in contact with your creditor. Most of the time student loan default is not permanent. Talk with your lender to find out how you can bring the loan out of default. Often, you will need to make several timely payments before your student loan will be considered current.

 

 

Bankruptcy, Foreclosure, Paid Tax Liens, Paid Judgments

You must use positive credit items to offset these types of blemishes. By rebuilding your credit and adding positive payment history you will be demonstrating that you can manage your credit.

A secured credit card is a great way to do this if you can not get approved for a traditional credit card.