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Friday, 9 March 2012

Student Credit Cards With No Credit History

There are a number of students who want to get a credit card as they go to college. Since they have never had any credit card before, or any loans or bills to pay, they don’t have a credit history. It is difficult to get anything major in the ‘no credit’ situation.

How does it affect the lenders?
When you apply for a credit card, lenders check your credit rating to see your credit score. If you do not have any credit rating, it might be viewed as unsafe by some lenders as they cannot be sure of the return of their money. This is why sometimes having no credit might be equal to having bad credit. And since students have no credit, it is difficult for them to get a credit card. So what can be the options for student credit cards with no credit history? Here are some of the choices that you have:

• Specialist card
There are special student credit cards with no credit offered by some companies that are especially for students with no credit history. But since there is more risk involved, the interest rates on such cards are higher. Apart from that, the initial credit limits may also be quite low. But that is not the case with all specialist cards. Different companies and banks provide different schemes and you have to contact them to know more about these cards.

• Bad Credit credit cards
There are many companies that provide credit cards to people with a bad credit history. They also work with people who have no credit record. Since interest rates of these cards can be higher than specialist cards, you need to weigh your options before going for these. It is best to get a specialist card if you do not have a bad credit history, but in any case, the option of a bad credit credit card is open for you.

• Parental cards
Many parents allow their children to be authorized users of their cards. This has interest benefits, plus parents get to know where their children are spending. So this is an important tool in the hands of parents, but limits the freedom of kids.

• Prepaid credit card
Instead of a general credit card, students can get a prepaid credit card that would work just like a regular credit card, but the money is previously loaded into its account- as the name implies. This way the provider company will not have any risk with a new user, and it will be safe for both parties. This is a great way to get a card that can be used in emergency situations.

If you are a student with no credit history, and are looking for a credit card, you can find many banks offering student credit cards. You might even find such cards available at the university campus itself. You can contact your student body at the campus and get to know more about them.
Visit www.studentcreditcards.com for more information about student credit cards.

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