Originally posted by coatsy:
You do not need a credit card to build credit. Do you have a car loan? If you are thinking on getting a credit card for money at hand you are better off going to your bank and getting a personal line of credit. THe interest rates are half as much, and you will build credit also, Buidling credit is over rated. We all usually have car loans, this builds your credit, and once you have secured a decent job for a length of time lenders, lend you money based on your income and ability to pay back the loan, not based on if you built credit through a CC.
Unless you can pay the CC balance at the end of every month, don't bother getting one. The interest SUCKS. Get a personal line of credit, likely around 4-5% interest if you are a student compared to 14-19 or more % with CC's..




I know lots of people with lots of money with mortgages and many car notes over the years whose credit score still sucks. Coworkers who make the same money as I do, have bought as many cars as I have, and own their own homes as I do, will have credit scores as much as two-hundred points lower than mine simply because they have no credit cards. The ability to hold and more importantly, not abuse, revolving debt counts for far more than a simple car note does. Not only that, but for a young person, it can take years and years before you ever display the ability to actually pay off a car note. And the long-term history of paying the note isn't worth nearly as much to your score as actually paying it off.

That 200 points is the difference between a 0% car note and a 12% car note.

All else being equal a person with credit cards will have a higher credit score than someone who doesn't.

And, BTW, ain't no way you're going to get a 4-5% on a signature loan right now. Prime rate alone is 8.25%, and banks are going to charge 2-5% more on top of that. I just took out one yesterday, with a score of 780, and my rate was 11.9% -- not much lower than some of my credit cards.

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