I’m 22 years old and I just applied for my first credit card (the Discover it Student card) two days ago. I’ve never had a credit card before, and honestly, I have zero knowledge about how credit works because no one ever taught me.
My credit limit is $500, and I really don’t want to mess this up. My main goal is to build my credit so I can eventually apply for a car loan through my credit union. I also want to have good credit in general, especially since I’m getting older and I know credit is important for things like getting approved for an apartment.
What’s confusing me is that I downloaded a credit app and it says my score is in the 720s but that doesn’t make sense to me since I’ve never had a credit card or taken out any loans. Do I already have credit somehow? I’m trying to understand how this works and make sure I’m using this card the right way.
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I would use it to get gas once or twice a month and pay it off. It’s can be easy to rack it up without realizing it. I had a mid 600 score with a car loan with 100% on time payments on it because my credit age wasn’t that old. I got a credit card and it shot up to 730.
This just happened to my wife. She got her first card and the card app said she had 700 score.The next week I took her to look at some cars to lease and they ran her credit. It came back as 0. No credit history. No score.
The apps might default to some fair credit average instead of 0 when they don’t have a history. If you actually run your credit it will not be 720.
I have no credit card and I am 21 years old, so you’re not behind. I think your life has just begun as an adult so go easy on yourself.
Some of those apps are fake. Have your credit union run a check to confirm.
I have a fantastic credit union with counseling etc. If yours offers those services, I suggest taking advantage of them.
I didn’t get a CC until I was around your age, maybe a tiny bit older. My credit is great, just pay your card off every month. My card gives me 5% cash back on gas and groceries so that’s the only stuff I buy with it and never go over 30% utilization. It’s super easy and you only have upwards to go as long as you do it right, just don’t over utilize your credit and pay it off right when you become able to every month and you’ll be fine
Credit score and credit history are two different things and both are taken into account for loans. Since you have no credit history big loans are unlikely to be granted to you without a really nice down payment but as your credit history lengthens your options will increase. Just live within your means and don’t spend money you don’t have yet on your card
If you are co fused as to who you started at 720, its because that is the average credit score and its basically neutral risk, neither good nor bad. If your credit dips below like 650 it means that loaning to you could be “higher risk” and loaning to someone who is significantly higher like 780 is “lower risk”. Since there is no credit data to apply to you your general credit score is “neutral risk”… basically nobody knows how you behave when utilizing credit yet
You’re 100% on your way to building credit. My advice, pay for everything on your card and simply pay off 100% of the balance every month.
Continue paying attention to prices and don’t spend money you don’t actually have.
They will raise your limit very quickly, but don’t change anything you’re doing.
At that point, if you want to continue building credit, identify something you need which would require a small loan (a few thousand dollars or so) and then pay back the monthly payment + 10% towards the principle. Your credit will sky rocket.
First off make sure u only use 10 to 30 percent of your credit card u go over that ur credit goes down its the utilization second there is two different things first is when ur supoosed to pay it off by the second is the closing statement date the closing statement date is when it goes to the different credit burro sorry dont know how to spell that word but anyway even if u pay it off in time if u dont have your card paid off when its time to report to the credit heroes u could fuck ur credit up or ur credit not go up becuase of that so find out when both are moniter it and pay them both on time my advice pay off everything every month and dont miss any payments