Finance/insurance

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cheri song
Dec 20, 2022
On making your first credit card, pt2
I've seen some advertisement for Tomo Credit floating around on this app. It's a new company that I am totally unfamiliar with though, so if somebody can dispense with me some experience dealing with them in the past, it'll be very appreciated! I always do welcome an opportunity to learn more about the mess of the system that is the American Credit Score system #creditscore In the meantime though, I would like to continue my earlier post with some general tips and goals for your first credit card. 1. This might come off as a bit obvious, but you need a SSN or an ITIN. I believe even students on F1 visa can apply for an SSN, if they work 3-4 hours weekly at the school cafeteria or library. Even if it's a bother, it's worth getting an SSN for a lot of things in United States so definitely get it if it's an option! 2. Now before, it was actually kind of a thing for people to just sign up to random cards willy nilly for their welcome package, only to cancel it almost immediately once they got it, but due to Chase's new 5/24 rule that's no longer recommended. What's 5/24 rule? Well, basically, if you've been approved for any five credit cards within the last 24 months, you are not going to be approved for any Chase Credit Card. This means that unless you are careful, you might miss out on huge, jackpot promotions and welcome offers they give out every so often. Besides, Chase Cards are generally top of the line when it comes to benefits, welcome offers, travel insurance, etc. I really wouldn't want you to miss all these things just because you got a credit card from, I dunnow, the Gap store for a 15 dollar discount or whatever. Speaking of which... 3. You are probably not getting a Chase or Amex card as your first card This might just be from personal experience but I've literally never heard of anyone who got approved for a Chase card as their first credit card. Obviously I don't know the exact algorithm or requirement they have, but I think they need you to have a decently long transaction history with a credit card before they consider you as a candidate for approval. After a year of credit card usage with another credit card product, you should probably be able to qualify for Chase cards, and Amex cards after only a few months. And then all the mileage benefits and cheaper trips to other countries won't just be a pipe dream anymore! 4. Your first card is probably going to be a bank issued one, Discover Student Card, or a secured card Probably the best option for your first credit card is to get it from your the major bank that your school or company that you work for deals with (Bank of America, Citi, Wells Fargo, what have you). Just get either the one geared towards students or the most basic option without annual fees. They might tell you 'you need a co-signer' or 'you need some credit history' or some such, but as long as you have a decent amount of cash on hand and in your account, you can probably negotiate out an approval with an agent as long as you 'promise' to make them your primary bank. The credit card limit doesn't even need to be big. 500 dollar should be plenty enough as long as you refrain from making any big purchases with it. If you don't like any of the options offered by your bank, you could consider a Discover Student Credit Card. I've never got one myself, but I've heard it's comparatively easy to obtain one than most other credit cards. There's also Tomo Credit which I've heard is pretty easy to get, but it does things differently from other credit companies. If anyone knows more about how they work, I would really appreciate you telling me about it! Finally, there are Secured Credit Cards, which is probably the most generic way to get your first credit card. As the name implies, you need to put down a security deposit with the issuing company for you to get a secured card approved for usage. There aren't actually that many major banks that offer secured cards as a product, I believe, but I've heard that local banks and credit unions offer them much more regularly. Of the major banks, I'd recommend using Citi Bank's secured card. It has no annual fees and you can sign up for it online, but it has no signup package last time I checked. I hope this information helps someone in the future!
Comments
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cheri song
Dec 18, 2022
Making your first Credit Card in United States! My tips
When making your first credit card, it's important to take the first step correctly to save a lot of heartache, time, and effort in the future. I was just thinking about writing a little list of things to keep in mind to help you in getting that first credit card. Getting the first credit card is the hardest step for most people. Afterwards, getting better cards that provide more signup bonus or loyalty rewards should be a matter of time. Here's my tips: 1. There’s no connection between your worth and your credit card issuance People keep making the mistake of continuously asking the credit card company to issue them a credit card after being rejected out of spite, even though they aren’t ready and the company had good reason to reject them. Whether it be a test, credit card issuance, or confessing to a crush, rejection is a nasty feeling. However, credit card issuance in United States has nothing to do with your worth as a human being or your pride. It is actually a mostly automated, mechanical process. There’s no reason to be slighted at the company just because your card’s been rejected. You don’t need to waste energy feuding with them, so just going through all the card options and applying to all of them one by one just actually makes it more difficult for your first credit card to be issued. 2. Giving up after a rejection If you thought “Well I don’t need a credit card anyways, I can just pay for what I want with Debit” after being rejected,” well that’s actually a similar kind of mindset as above, just expressed differently. To give up on having a credit card in United States is to not only give up on whole host of mileage benefits, but also to give up on creating an easy source of credit rating—which you would need later when taking out a loan, mortgage, or buying a car. You are going to be dealing with it anyways, so you might as well start early. 3. Credit Score isn’t everything A lot of people here probably are completely new to the whole American credit card system, but a lot of people probably also know the basic knowhow of credit card issuance These people tend to ask: “My credit score is 700, so why am I not getting approved for a sapphire preferred credit card?” or “My credit score is 680. Can I still get approved for freedom card?” These kinds of questions assume that credit score is the absolute objective standard through which credit card issuance is determined/ In my experience, though, whether that credit score is the FICO score or the FAKO score (which you can check in freecreditreport.com), you shouldn’t be overconfident or underconfident of what that credit score might mean to the issuing companies. It’s not like your credit score is your GPA or your exam scores. In other words it’s never really the case that you can say “people with over 700 credit rating can of course get a sapphire preferred card!” or “people above 680 can definitely get a freedom card!” Actual card issuance has a lot of other factors in play such as their income, pattern of card usage, relationship with the issuing company, length of credit history etc. Credit score should only be considered a rough tool for tracking reliability. In addition, for immigrants and foreign exchange students, whose credit history isn’t very long, your credit score is probably not a good reflection of your financial history anyways. The banks know this and you should always keep this in mind. In an ideal world your credit score should be a perfect indicator created after careful enumeration of the length of your transaction history, income, etc etc, but in reality your credit score will be pretty high as long as you don’t have anything explicitly negative in your history such as non-payment. So if you only put your trust in your credit score and keep asking for a card to be issued, you are liable to getting rejected. 4. Credit is a long term battle. There’s no need to take out any loans on purpose. There’s some people who advise that the fastest way to raise credit score is to take out loans on purpose. There are some people who can easily pay for a car with cash, but purposefully took out a loan with high interest rate to raise their credit rating. After they make a credit card, some people who believe in this even refuse to pay the owed money entirely, only making minimum payments. If you carry this debt for few months while paying interest, apparently your credit score rises rapidly. Well, of course, I’m sure the banks do genuinely love clients who pay through their nose on interest payments to them. But you really don’t need to use such extreme methods to raise your credit score. As long as you keep using your credit card and pay for the full sum without delays, your rating will increase naturally. It takes time either way, so there’s no need to rush.
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T
T R
Nov 18, 2022
Medical Debt Collection
Hello! I'm currently a student and I'm writing here to get some advice. I missed payment for a medical bill recently and just heard that the hospital sold the account off to a debt collection agency. The reason I missed payment was out of a simple misunderstanding. I checked my account and saw that they billed me for 500 dollars. After dithering for a while, I noticed that the account now had 0 dollars in balance. So I assumed my insurance took care of it. I've been getting some weird calls lately which I assumed were spam calls, and they've been leaving me voice mails in Chinese which I don't understand. I checked the number online later and they turned out to be some kind of debt collection agency? I mean, I pay my credit card bills every month, so I was really confused where I could've accrued a debt, but then I checked the hospital account, where they told me that they handed over my account to a debt collector. There's still about 200 dollars left to pay on the balance. I'm just wondering if this is going to negtiavely impact my credit score. And if so, by how much?
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jasmin lee
Nov 18, 2022
Should I limit usage of credit card even all owed fees every day?
Hello! I've been using my credit card more often these days, but I make sure I pay for all the outstanding fees on my account every day. I've heard from someone that I still should refrain from spending too much through my credit card, because apparently if I use more than thirty percent of my credit card limit, it impacts my credit utilization ratio which negatively affects my credit rating. The only reason I use my credit card often these days is because I thought that if I keep making little transactions and paying for it immediately, it would boost my credit score. Can anyone tell me if it's true if using the credit card too much negatively affects my credit score even if I pay all outstanding fees before their due date?
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