How College Graduates Can Get Access to Credit Cards

Congratulations; you made it through college. You managed to make it through without accepting those obnoxious credit card offers from pushy marketers, and, as a result, you don’t have any credit card debt to worry about. Now it’s time to get a job, buy a car, and maybe think about homeownership.

But the first time you apply for a car loan, you get turned down for insufficient credit. How can this be?

This is the very situation that many new grads find themselves in. Through no fault of their own, they’ve put the brakes on their credit, disqualifying themselves from the very purchases that signal the beginning of independence. It takes credit to get credit. In the case of major purchases, it can take quite a bit of credit.

The problem is that college students receive mixed signals, and it can be tough to figure out which road to take. On one hand, they’re targeted by aggressive credit card marketing campaigns that offer everything from free pizza to free Ipods if the student will just sign the dotted line. On the other hand, they’ve watched their parents and seen firsthand how credit card debt can devastate someone’s finances.

So what should a college student do? Experts recommend a compromise: apply for one or two credit cards during your college years, but avoid the temptation to overspend. Charge small purchases on a regular basis and pay them off each month. That will establish a history of timely payments that will be very important to your credit report and your future buying power.

What if you’ve already graduated? According to a representative from LendingTree.Com, you might be able to find student offers that you can still take advantage of, but it will require a little digging. You can also get a secured credit card to help build up your payment history and open the doors to better credit opportunities. Secured credit cards require you to deposit funds into a bank account. These funds will cover your debt in the case of default. Just be wary of any secured credit card that requires you to pay fees for monthly, annual, and initial use.

Finally, if you really need a credit card but just can’t seem to get one on your own, you could ask a family member to co-sign. If you choose to do this, make sure they understand that they will be responsible for any payments you don’t make. Negative items will affect their credit score as well as yours, so do be courteous and responsible when you have a co-signer.

The problem of access to credit after college is very real. To keep yourself out of this crunch, get a card or two while they’re easy to obtain – during your college years. Make your payments in full every month, and you’ll build up your credit without falling into a debt trap.

by: Janna Weiss