Question: My son needs a credit card as he is going back to school after working for a couple of years. He currently carries one of my cards and is very careful to pay me in full each month for any purchases he makes. I don't think he's eligible for a student card, so how can he get a card in his name?
The rules regarding student credit cards have changed since the last time your son was a student, and he's more likely than ever to get accepted for an account once he's back on campus. Not knowing your details or family history, it sounds like your son has what's called a "thin credit file."
Even after a few years in the workforce, he hasn't built enough of his own credit history to trigger an instant approval credit card offer. You've graciously allowed him "authorized user" status on your existing account, and it sounds like you've helped him establish a strong habit around paying down a balance each month. However, all that effort only shows up on your credit report, not his.
Banks use student credit cards to "test drive" potential long-term customers. With low credit limits and higher-than-average interest rates, they usually serve the purpose of establishing a baseline for a student's future borrowing behavior. If your son's been working and he's over the age of 21, he'll likely earn a good deal with top-rated student credit card isuers such as Discover, Citi and American Express.
On the other hand, if your son already has a ding or two on his credit report, he may need to rely on a secured credit card to help manage college expenses. Capital One, Wells Fargo, and Bank of America all offer strong secured card programs that don't cost a lot of money. Unlike some of the "bad credit no problem" deals you'll see online, these name-brand cards offer paths for your son to convert a secured card into unsecured credit after a year or two of positive behavior.
- I keep being denied a credit card so what do I do? I'm full-time college student and work one full-time job so I have income, but I need a credit card to build up my credit so I can buy a car.
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