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Applied for Discover student card and got denied. Will this hurt my credit?
I’m currently a high school student and applied for the Discover student card, which I figured was for any student 18 years or older. I have a steady income working a part time job, have mutual funds, checking and savings accounts, etc. I thought I was good to go for a credit card. However, I got a call back saying that because I had no credit and wasn’t a college student, I wasn’t approved. Wasn’t that the whole purpose of the credit card though — to issue it to students with NO credit? I told the person on the phone that I thought their card was a little misleading, because nowhere does it specify what type of student you have to be.
I’m worried that by Discover pulling my credit will look very poorly on my credit report. I kind of visualize it as before I had a completely clean slate — no debt, no credit, no nothing. Now, I have no credit or debt, but I have a credit pull which looks very poorly. Am I OK? Should I apply for another card, or wait until I am in college to re-apply? Any advice from people who were/are in the same boat?
...asked on July 19th, 2012 @ 12:03 am in Credit Card - Student
There is no damage so I wouldn’t worry too much about it. As of February 2010, you have to be 21 and employed full time employed for at least 12/18 months or you’ll need a co-signer.
...answered by stan c on July 19, 2012 @ 12:21 am
I would suggest talking to your bank or credit union about their card products. You may have to start with a secured card if you have no credit currently reporting. Since you are established at the bank or credit union then they would probably be your best option at this time.
As for being under 21 and obtaining credit, some people should read the Card Act …
H. R. 627—15
(8) APPLICATIONS FROM UNDERAGE CONSUMERS.—
(B) APPLICATION REQUIREMENTS.—
(ii) submission by the consumer of financial information, including through an application, indicating an independent means of repaying any obligation arising from the proposed extension of credit in connection with the account.
Which boils down to, since you are working then that is considered an “independent means” to repay what you charge. The only thing that may hinder you, other than having no prior credit, is if your yearly income is lower than $ 11k or $ 12k a year. Creditors have a base yearly income amount and usually that base is around $ 11k to $ 15k, though some creditors have a base that is much higher.
One other thing that you might consider is if your parents have credit cards that have been kept in good standing and with low utilization then you might ask them to place you on one or more of the accounts as an authorized user and they should request that the creditor report the accounts on your credit reports. As long as the authorized user accounts are reporting then that will help you while you’re trying to build up your own credit profile.
...answered by anywhoo on July 19, 2012 @ 1:18 am