A College Student’s Credit Nightmare

Posted in Rants on Sep 16th, 2009 | View Comments

About two weeks ago, my Econ professor was talking about credit scores, the credit industry, etc., and he suggested that we all start trying to build some credit for ourselves so that by the time we’re out of college, we will have established ourselves and we’ll be ready for the “real world.”  So, what did I try and do?  Go out and get a credit card, of course!

The first card I tried to get was an American Express Blue Cash card.  I filled out the application, and I was denied.  Why was I denied?  Well, the error that TransUnion spit out was about my file not having sufficient credit to score.  This made sense to me.  I had no credit history.  However, what I didn’t understand was, how could I start building some credit if I I couldn’t get a card for the very reason that I had none?  After I got the denied message, I called American Express later on in the night to see what could be done.  The very nice lady on the phone decided to try and apply me for a few more of their cards claiming that each card has different ellegibility requirements.  This sounded like a bad idea to me, but I figured, what the heck.  So, she applied me for three more of their cards.  Denied on all three due to the same reason.  What the HECK?  So, as I always do, I found the company, American Express, on Twitter to see if there was anything else they could do – perhaps offer me a card with a ridiculously low limit?  Anything they could do, I figured, would be beneficial.  They ended up giving me a card linked to another cardmember’s account.  It allows me to build my history, but the account is essentially not in my name (the card, however, is).

Yesterday, however, I discovered (hah) that Discover has a special card designed for students that requires no previous credit history.  GREAT, I thought!  Well, guess what?  I was denied for that card, too!  Why?  Excessive number of credit inquires into my history, said TransUnion.  At this point I was rather mad.  Had it not been for the first person from American Express trying to get me every card under the sun, this wouldn’t be the case.  Frantically, I called TransUnion.  TransUnion said there’s nothing they could do besides mail me a report and they advised me to call Amex again.  I called Amex.  They are going to be able to remove the inquires into my account, but I have to send them a letter and such first.

So, what about the Discover card? Well, after calling Discover and talking to a super nice guy named Ron, I now have a Discover card.  I had to fax him some information about me being a student, proof of enrollment, etc., but he was able to get me a fairly generous line of credit.  So, THANK YOU, Ron.

Anyway, thanks for reading my rant.  Hopefully you can see why I’ve been incredibly annoyed and frustrated over the whole credit thing.  I’m only 18, and I already hate it!  The good news is, I plan on paying off my balance each month; I’m not going to accumulate debt for myself at such a young age.

What do you think?  Did I go through hell, or what?  Leave me a comment with some sympathy!!

  • http://www.technoheads.org Salem

    That seriously sucks. Why would they deny you access, particularly if they ask for no credit score, on the grounds that your credit information was accessed too many times? Isn’t the whole idea behind this that you don’t care about the credit score in the first place?

  • http://ryanyaple.com ryan

    Welcome to the world of moronic companies. This is why the new credit card bill isn’t the best!

  • Mike

    That’s correct, Salem, which is why Ron was able to override the denial and he even bumped my credit line up a bit for the inconvenience. So, again, thanks Ron from Discover!

  • Chris

    The years of free wheeling credit seem to be over. When I was in college, RMU, C/O 2001, there were credit card companies on campus, and I got any card I wanted. On September 15, 2008, when Lehman Bros. filed for bankruptcy, the World was changed forever. Credit is a risk. You being a college student are a risk.

    I realized that there was a problem and things have changed when I went to look at cars about a year ago. My credit score came back at 715. I was always in the 730-740 range. When I inquired, they did a revised debt/income ratio, and my score was lowered. I have never missed a payment. I have already bought and sold a house. I realized then, things have changed. Credit is tight. Credit is a risk. If mine went down to 715, I wondered how this would effect riskier people, like you. Seems it did.

    Recently, My wife got a letter from Discover. They were closing her account due to inactivity. She only used it for emergencies (car, etc) and always paid it off. A day later, my AMEX blue, which I use for business, lowered my limit, and raised my interest rate. I was shocked. But – when the financial crisis hit, credit card companies were forced to look at their customers. In reality – I meant nothing to them. They were not making money off of me, so my accounts were closed or adjusted.

    Sadly – I agree with this change. You seem like a responsible kid – but for every you, there are 9 schmucks that are going to charge a keg of beer, and never pay it off. And the credit card companies know this. Things were out of control. Now we are back to a place where people are forced to grow credit the old fashioned way – slowely.

  • Mike

    Chris, thanks for your input. I absolutely assumed it would be damn near impossible for me to get credit, which is why I’m so thankful that Discover was able to help me out, and at least I have a makeshift Amex solution for now. I buy a lot of stuff online, including a lot of tech products, so the Amex benefits like hassle free fraud detection and removal, extended warranties, return guarantees, etc., really make it the perfect card for my online purchases. I plan on using the Discover card for my every day purchases so I can get the 5-20% cash back. As I mentioned, though, I’m just using these like a debit card. I won’t be buying anything unless I have the money to pay for it. That being said, however, if I can get a limit raise before the Apple Tablet comes out, I may pay that off in two-three payments, just to show that I can pay something over time, rather than all at once. I understand this is good to demonstrate, too?

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