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Originally Posted by Jonnypops
NoSoup,
This weekend I am looking in to opening my first credit card(s) in order to build my credit rating. When choosing a bank, what things should I look out for? Also, how many would you advise for me to open?
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Sorry about the delay in getting back to you...
As you may find out, it is difficult to qualify for a decent credit card with no credit history. The easiest way to begin building credit is by getting a secured credit card - to get one, just go to a local bank or credit union and see if they offer them - most do. You will likely have to open an account and deposit $X - the collateral for a card. In return, you'll get a card with a credit limit of $X. After a period of time you'll likely be able to qualify for other cards without collateral, but this is probably the best way to start, with the exception of possibly a cosigner.
When choosing the bank, I would call around first. I would heed the advice in the original post as far as how high you bring your balance, but always pay the card off in full to avoid paying interest. Make sure that you get a card with no annual fee - other than that, simply pay attention to the interest rate and any other miscellaneous fees that may be associated with the card.
Since you are just beginning to build your credit, I would suggest getting two credit cards - preferably with two different banks/credit unions.
Again, I would avoid Capital One due to them not reporting the credit limit when they report the balance owed on the card...
Good luck, and if you have any more questions, please let me know! I'll do my best to answer in a bit more timely fashion
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Originally Posted by IsuGuy
I would like to add this point, as I was not sure about it myself.
You can check your own report as many times as you want and that will not hurt your score or even show up. Also any accounts you currently have open can also check your report monthy without hurting your credit.
The initial inquries by companies are what hurts your score. Also i believe you have 7 days to "shop around" where you can have companies check your score and only get dinged once. Say you are shoping for Mortg. rates as an example.
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Be very careful...
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You can check your own report as many times as you want and that will not hurt your score or even show up.
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This is true...
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Also any accounts you currently have open can also check your report monthy without hurting your credit.
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This is false.
Any credit inquiries that you authorize, even from current account holders, shows up as an inquiry on your bureau and will damage your score. The only inquries that don't are the ones that you pull yourself from a credit reporting agency (typically you have to pay for them) The free annual credit report that the government enacted, and broad based credit summaries purchased by credit companies - typically the source off all the junk mail you get when it says you are "preapproved."
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The initial inquries by companies are what hurts your score. Also i believe you have 7 days to "shop around" where you can have companies check your score and only get dinged once. Say you are shoping for Mortg. rates as an example.
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This is also false.
You only have a brief period to shop around when searching for mortgages, and on occation vehicle or other collateralized loans, depending on the institution doing the lending. If you apply for several different credit cards within a short period of time, your score will be reduced accordingly.
Additionally, I believe the period is five days, although it may have recently changed.
The moral of the story is this - even if you are shopping around, don't shop around excessively. If you are interested in getting a ton of different quotes, simply purchase a copy of your credit report and bring it to potential lenders and ask them what you would qualify for providing that the copy they would pull is relatively the same.