# Credit Cards for People with No Credit Rating



## CN (Sep 3, 2004)

So I'm trying to get a credit card. I don't think I have any credit rating (or very little, although I do have regular Payroll Deposits going into a chequing account) so I'm not sure if I'm going to be approved for ANY card.

I tried applying for a PC Financial Mastercard, but was automatically rejected because Equifax Canada has no (or insuffienct) information about me. I am a student (High School right now, but I have been accepted to a Queens U for next year) and I just want a low limit ($500 would be enough) Credit Card for emergencies/online purchases. Monthly interest rates don't matter as I have no intention of building up any debt on this.

I do have a decent amount of income I can declare (a part time job + $12,000 yearly scholarship which I can declare as income) so I don't think this will be the problem. <b>I am wondering whether ehMacers have found any Credit Cards that are easy to get approved for (or "guaranteed" approval). Sure, you pay a higher interest rate, but I won't be carrying any balances from month to month so its not an issue. I do not want to simply be included under my parent's credit card. Any recommendations would be greatly appreciated </b> (Yes, I know the temptation which is associated with credit cards, but my parents and I agree that it is a good idea and anyways, I have been managing my own money for long enough now ).


----------



## Beej (Sep 10, 2005)

CN said:


> So I'm trying to get a credit card. I don't think I have any credit rating (or very little, although I do have regular Payroll Deposits going into a chequing account) so I'm not sure if I'm going to be approved for ANY card.
> ....
> I tried applying for a PC Financial Mastercard, but was automatically rejected because Equifax Canada has no (or insuffienct) information about me. I am a student (High School right now, but I have been accepted to a Queens U for next year) and I just want a low limit ($500 would be enough) Credit Card for emergencies/online purchases. Monthly interest rates don't matter as I have no intention of building up any debt on this.
> 
> I do have a decent amount of income I can declare (a part time job + $12,000 yearly scholarship which I can declare as income) so I don't think this will be the problem. <b>I am wondering whether ehMacers have found any Credit Cards that are easy to get approved for (or "guaranteed" approval). Sure, you pay a higher interest rate, but I won't be carrying any balances from month to month so its not an issue. I do not want to simply be included under my parent's credit card. Any recommendations would be greatly appreciated </b> (Yes, I know the temptation which is associated with credit cards, but my parents and I agree that it is a good idea and anyways, I have been managing my own money for long enough now ).


Payroll deposits aren't a part of a credit rating.
...
There are cards promoted specifically on university campuses, if you can wait. Mastercard used to be the leader in that respect.

There are also cards for people trying to (re)build credit that require a deposit from you (essentially they operate like a cash card). In the long run it is a good idea to build a solid credit rating. Note: applications for credit are a part of your rating so only apply for what you need; the shotgun approach is not recommended.

Some googling should turn up the deposit-type credit cards.


----------



## gastonbuffet (Sep 23, 2004)

when i arrived in Canada, i went to TD and made a locked 3 year investment as collateral for a credit card with the same limit as the investment. If you can spare $500, this should be available to anyone. But i had NO HISTORY, you got some, so the bank should be accomodating.


----------



## CN (Sep 3, 2004)

Beej said:


> Payroll deposits aren't a part of a credit rating.
> ...
> There are cards promoted specifically on university campuses, if you can wait. Mastercard used to be the leader in that respect.
> 
> ...


Thanks for the reply! PC Financial must have given me the wrong impression with regards to Payroll Deposits...when I called them, they referred to my Payroll Deposits as though it would help my application (which doesn't make too much sense) but I must have misunderstood.

If I can't get an actual credit card, I may just have to wait until I am officially enrolled at University, and then go for a student one. I would rather not go for the prepaid cards, but at least i know they are an option.


----------



## MacDoc (Nov 3, 2001)

Do the TD route - I set my daughter up that way - good way to build a credit rating and after 2 years you get the deposit back. If you ante up $5k you can even get a Gold travel points Visa - if you happen to hav that much cash about it's not a bad way to launch a credit rating and these days you can use VISA for just about all expenses so travel points build quickly.


----------



## jasonwood (Oct 19, 2003)

Try for a Mosaik MasterCard: http://www3.bmo.com/mosaik

No fees and you can choose between multiple rewards such as annual 0.5% cash back or Air Miles. Or pay an annual fee and get 1% back or more Air Miles.

Your payroll doesn't affect your credit rating with any credit bureau, but most applications will ask for your income, and your answer will affect how the issuer assesses you.


----------



## Beej (Sep 10, 2005)

CN said:


> Thanks for the reply! PC Financial must have given me the wrong impression with regards to Payroll Deposits...when I called them, they referred to my Payroll Deposits as though it would help my application (which doesn't make too much sense) but I must have misunderstood.


A verifiable income may matter (most important is a steady full-time income for 6+months from the same employer for mortgages) but when I've applied for cards it's just an unverified question like 'did you pack your bags'. When I've received my credit reports, 'payroll deposits' play no role and their employment information for me is way out of date. Thus the importance of credit history: pay on time everytime or it can stick to you for many years (7?) and not loading up on credit applications, which also stick around on your report.

You can get your report (I'd recommend it) from Equifax for free using a snail-mail process or for about $20 on the internet plus you'll get some scores (of questionable value to you now...you can't do anything about them.


----------



## monokitty (Jan 26, 2002)

The banks love me. 

Strange that you couldn't get a credit card - very. Are you 19+ years old? I remember when I got my job back in Oct. 2004, I went to the bank for a completely unrelated matter in November of the same year, and they _offered_ me a Credit Card on the side. Does it make a difference if you work part-time or full-time, maybe? Since then, my credit limit on that same card has hit $3000.00.

Some advice: If you do end up being approved for a credit card, even if only with a $500 limit, use it to buy most to everything. The more you put on your credit card, and assuming you pay the minimum (or everything), you'll start building positive credit ratings for future limit increases, and the ability to get credit for other things later on. After spending a tad over 12 months putting every single I bought on my credit card, I've built a very strong credit rating with TD (never once did I fail to pay my balance), and even secured a $15,000 Line of Credit without breaking a sweat when I wanted one. Based on that, I could probably get any type of additional credit in the future without issue or questions.


----------



## Jason H (Feb 1, 2004)

The second I turned 18 I signed up for a credit card with royal bank. I was almost instantly approved, with a $1000 limit. Then I applied for a ctc mastercard and was approved too. Once you have one card you can get as many as you want really.


----------



## Heart (Jan 16, 2001)

My first was Canadian Tire....

But it is best to use cash:

*Secret History of the Credit Card*
The surprising history and clever tactics of an industry few fully understand.
http://www.pbs.org/wgbh/pages/frontline/shows/credit/view/


> It's one of the most wonderful times of the year for the banking industry's most lucrative business: credit cards. In the coming weeks, millions of Americans will reach into their wallets and use plastic to buy an estimated $100 billion in holiday gifts. But at what cost?


Beware.


----------



## Jacklar (Jul 23, 2005)

I was in the same shoes as you last year. Went to my bank and applied for a student credit card and was given a $1000 limit.

I'm with RBC, so if you goto your bank and apply for a student credit card you should be good. Just bring along your acceptence letter incase they ask you for proof.


----------



## icemakk (May 12, 2000)

I know you can get a prepaid Master Card at MoneyMart. As little as 500 bucks gets you a card so you can make purchases online, book flight tickets and all those other things that plastic is good for.


----------



## CN (Sep 3, 2004)

Wow, ehMac really is awesome! I'm going to go (in person) to a bank, and try to get a 'real' credit card (or, failing that, do the $500 investment as collateral method). Perhaps, like JasonH and Jacklar, they will approve me...thanks for the tip on the acceptance letter.

Thanks for the tip on 'buying everything on the card' Lars; makes sense that buying everything and then paying it off would build up your credit rating faster (which would definitely be useful). I suspect that PC is very stingy...they won't even let me get at my own money, let alone theirs it seems  Seriously, I can't even up my daily spending limit (its MY money, in MY account, which has sat uselessly and cleared for 10 bus. days, no overdraft at all, and I still can't even increase my daily spending beyond a very limiting amount). Perhaps they can be selective, with their no fees (at all) approach.


----------



## Beej (Sep 10, 2005)

CN said:


> Thanks for the tip on 'buying everything on the card' Lars; makes sense that buying everything and then paying it off would build up your credit rating faster (which would definitely be useful).
> ...
> I suspect that PC is very stingy...they won't even let me get at my own money, let alone theirs it seems  Seriously, I can't even up my daily spending limit (its MY money, in MY account, which has sat uselessly and cleared for 10 bus. days, no overdraft at all, and I still can't even increase my daily spending beyond a very limiting amount). Perhaps they can be selective, with their no fees (at all) approach.


I'm not sure that's true. Maybe some research on that would be useful. When I've seen my credit rating, the factors are outstanding balance, credit limit, payments 30 days late, 60 and 90 and current status. I'd say just use it when appropriate and always pay the bills on time. One transaction a month should keep things nicely.
...
PC was started as quite stingy (turned me down for a savings account when I first applied many years ago!); I think it has to do with very narrow margins: they want to make sure they're not just getting people who *need* to save $5, and they take their margin where they can. They weren't profitable for years, and I don't know if they are yet (I don't think CIBC breaks out their numbers anymore). I've been a happy customer for a long time because, in the end, their model works really for me.


----------



## RevMatt (Sep 10, 2005)

Heh, I couldn't survive if my pay check was held. In any case, I was simply handed my first credit card, but that was many moons ago. I only comment to say: be VERY careful! Credit cards are dangerous.


----------



## Jason H (Feb 1, 2004)

CN said:


> Wow, ehMac really is awesome! I'm going to go (in person) to a bank, and try to get a 'real' credit card (or, failing that, do the $500 investment as collateral method). Perhaps, like JasonH and Jacklar, they will approve me...thanks for the tip on the acceptance letter.
> 
> Thanks for the tip on 'buying everything on the card' Lars; makes sense that buying everything and then paying it off would build up your credit rating faster (which would definitely be useful). I suspect that PC is very stingy...they won't even let me get at my own money, let alone theirs it seems


PC financial gave me a whopping $5k credit limit on my mastercard when the bank and canadian tire gave me only $1k

Good luck!


----------



## Kosh (May 27, 2002)

Beej said:


> Thus the importance of credit history: pay on time everytime or it can stick to you for many years (7?) and not loading up on credit applications, which also stick around on your report.


Good advice, and this I believe goes for bills as well as credit cards. Always pay your bills on time and at least pay the minimum if not the full amount. Bank at the same bank to create a history. Like a few others suggested look for a student credit card - my University had a bank on site, which helped, they had info on these things. I hate to suggest this, but do you have a favourite department store? Try applying for one of their credit card, BUT (BIG WARNING here), only use it for things that you can pay off right away... ie. don't put more on it than you can pay off that month as you want to pay those credit cards in full. Department store credit cards have ridiculously high interest rates. 

Another wild idea may be if you have a big purchase that you're going to make in the future and you were going to pay in cash, get a bank loan instead, and get your parents to co-sign. Make the first couple of monthly payments and then pay the loan off completely. That should establish a credit rating.

Like Lars, banks (and credit card companies) love me. Probably has a lot to do with my credit history.


----------



## UnleashedLive (Aug 9, 2004)

I'm sort of in the same position. I have PC financial bank card so I went and applied to their credit card but was rejected. I think the combination that I don't work right now (I worked for 3-4 yrs and saved up enough money for my first year of university) and that I've only lived where I am for 7 months and will be moving again in May didn't help. I wanted the card to make bills such as internet, cable and phone easier to pay off. But at this point I don't really care any more. I don't really want a card so I only put minimal effort towards getting one.


----------



## rgray (Feb 15, 2005)

altrodesigns said:


> ........ I have PC financial bank card so I went ...........


At the risk of being seen to be flogging a dead horse (as the expression goes), referring to a banking discussion here some time ago, this is one of those places where it helps a lot to be aquainted with a regular branch type bank. The major banks have 'student' VISA (whatever) programs. If you are/become a regular at your local branch then you become a 'known client' - you can then get a student visa card good for about $300-$500. THEN you have a credit history!!! Personal contact *DOES* indeed have its benefits.


----------



## scootsandludes (Nov 28, 2003)

Are you in a rush to get a CC? When I was in high school, at 18, I had a job at very busy bar/club, I estimated I was making about 18k a year working 2 night a week from tips and pay, and I was rejected for a CC, the only thing they would offer me was a prepaid CC which defeats the purpose of a CREDIT card.

When I went into Post secondary, things changed. All of them begged me to sign up with their credit cards. So I got a Visa and MC, totalling max of $1500. 

The banks don't care how much money you make, or even your credit history, they're just not gonna trust a high school kid with that kind of responsibility.
Waiting until August to get a CC shouldn't be a big deal, you made it this far without one. When they know you are fully accepted and have gotten a schedule, they'll be on their knees hoping you will sign with them.

So just wait a few months.

vince


----------



## gastonbuffet (Sep 23, 2004)

the good thing about the cc that's backed with your own money (hence, not a real cc) is that it teaches you a hugely valuable self reliability lesson. Most kids today will dismiss this, but it is crucial for a financially stable future. (which is a HUGE problem in this society). 

pretty simple: if you need credit to buy it, then you can't afford it, so don't. this will save you a lot of headaches (speacially the day after you realize that last night you spent $ 80 buck on shots to finance at 18,5% compounded weekly)


----------



## poisonmonkey (Sep 20, 2004)

I got a credit card in HS.
I was using the Shoppers Optimum Visa.

And PC Financial is stingy, until you get to post secondary. Then they will relinquish some control back to you.


----------



## draz (Jun 13, 2005)

Go to any university campus around lunch time, where there are tables with good for sale, or where people eat and hang out, there will be any people there pushing credit cards (as they get $20 for every person they sign up) so you can get hooked up there. Or you can simply apply online. Just state that you are a university student and volla.

Mosaik through Bmo, TD visa, the TD GM visa card will issue to anyone but they have sketchy fees for things like cash advances, etc. usually your bank will set you up with one with little hassle.

Or go down to king and bay and walk the underground of first canadian place (under the big BMO building) and sign up for a planum or gold card at one of the stands. Then they will call you telling you that you do not qualify as your income is under 100,000 a year but they will offer to set you up with a student one. I see this all the time.


----------



## draz (Jun 13, 2005)

And another thing....get ONLY one and don't go over boad....paying 18%+ a year blows...


----------



## CN (Sep 3, 2004)

Thanks for all the input! Headed down to TD this afternoon and was approved for a $500 max. TD Student Visa (not even cash-backed ). The guy seemed to be able to pull a few strings due to my University acceptance (despite the fact that my credit check indicated insufficient credit history).

So I'm on my way to good credit, at least now I've got a credit card to start building a credit rating...it only gets easier from here (yes, I know how to manage my money and not to spend more than I have ).

Thanks again for all who had suggestions/helpful info for me!


----------



## Beej (Sep 10, 2005)

Congratulations! CCs are great to have for emergencies and you are obviously aware of a good way to treat them outside of emergencies.


----------



## Jason H (Feb 1, 2004)

I'm 20 and my credit cards have a combined limit of $22,000

I guess thats pretty good. Now, $5000 of that is a best buy credit card i've shredded. I only applied for it get the free bottle of coke they were offering! lol. I saved $1.50!

Oh! I'd also like to mention that I have never paid any interest... ever!


----------



## i<3myiBookg4 (Mar 17, 2006)

Hi there,

I tried to get a credit card on my own (without my mother involved) with one year of university under my belt when I turned 19 last year. My bank said no, I had done all of my banking there, and my mom had been a client since the 70's. I only wanted a $500 student VISA and I was getting $200/month CPP.

Well, I had a youth account at another bank (it ended at age 19) so I tried there and had NO PROBLEM getting the $500 student VISA card. I closed my two accounts at Bank #1 and switched over to Bank #2. 

I have a Mastercard and a credit card for a department store now as well. I am currently working full time (just started). I'm going to be 20 in June... tried university, then tried community college, now I plan on being in the working world, might go to paramedic school *someday*.

Also, someone wrote that they had a Shoppers Drug Mart VISA in high school? Right? I tried to get one, and the minimum income requirement is $15,000 or something like that (that's what it is for most) so I couldn't apply online after filling out the income portion.


----------



## Paul O'Keefe (Jun 3, 2005)

A friend of mine once told me that he used to keep his only credit card frozen solid in the middle of tupperware container in the freezer. So if he needed to use his card he would really have to think it over as it thawed out. This eliminated abuse/impulse buying.

My girlfiend in university got a credit card in her second last year. She used it to start paying for things and treated i like free money and never seemed to be able to pay it down in a timely fashion. I bet she is still paying down that first meal she bought on it now six years later.

Personally, I don't have a credit card. I'm twenty-six and I plan on never having one. If i have an emergency I contact the police, the fire department, or the hospital. If I need money I have a bank card. I do have $500 overdraft on my account for times when cashflow is off.

I believe that credit and credit cards are symptomatic with a pervasive problem in our society. That is: paying for the present at the expense of the future. Individuals do it. Households do it. Towns do it. Provinces do it. Nations do it. Our whole economy revolves around debt; trying to and avoiding to pay it off. It's how we treat our resources and our environment.

So instead of purchasing with credit, I only purchase something once I have saved up enough. I use money orders, wire transfers, cash, bank cards, and online banking for purchases. Of course that makes ordering apple stuff a little more complicated but it keeps me from make rash decisions.

Despite my contempt for credit, I do have a student loan that will paid off shortly (five years after graduating). That's part of why I hate debt so much. Also I have a small mortgage. Hopefullly it will be paid off in the next few years.

Anyway that's my rant. Sorry to derail the thread, but I just wanted to let others know that life without the credit card is possible. Several billion can't be wrong.


----------



## i<3myiBookg4 (Mar 17, 2006)

I am known for being "tight" with my money, but I don't take it in a bad way and I am wise beyond my years (so I am told).

I was at the mall with my friend and we were at Sears because she was getting a new bathing suit. Well, I needed a new one too so I went home to ask my mom and she thought "Well, use my Sears card" and she called right up to ask for a secondary card for me to use. This took place a few years ago and I still have that secondary card to this date, I never abused my priviledges with it because I knew my mom would get on my case.

Now with my own credit cards I am still responsible with them, my mom is not going to come running at me with the bill, but I know that it WILL have to be paid off, I will be the one to pay it off. Most of my friends live by the "free money" idea...

Actually last year when I was away at university I needed winter boots so my mom told me to go to Sears with the card and get them, then she would pay for them after... so I found the boots I wanted for $40 and left. She told all of her friends about how I only spent $40... a couple weeks later the same boots were $100.


----------



## CN (Sep 3, 2004)

i<3myiBookg4 said:


> Now with my own credit cards I am still responsible with them, my mom is not going to come running at me with the bill, but I know that it WILL have to be paid off, I will be the one to pay it off. Most of my friends live by the "free money" idea...


I never have quite been able to grasp that 'free money' idea (nor can I understand how others live by it)...I mean, if you don't have the money right now (the ACTUAL money, not just credit) then you shouldn't buy it. If you don't have the money now, don't assume you will when it comes time to pay your CC bill. Obviously this only applies to regular things (not emergencies).

Hehehe...reminds me of one of my friends...he's going on a trip, and he wants a DSLR (!!!) to take with him. So his parents are buying him a $1200 DSLR kit (he's never even used an SLR!). :lmao: He says he wants 'to take some really good pictures'. Yeah, I think 8 megapixels is kind of overkill (just a bit ), he'd be better off with a nice point and shoot. Oh well, at least I'll have a DSLR to play around with (my $50 Pentax SLR -eBay- from the 1980's is still fine by me though). He can go digital darkroom, I'll keep my retina burning enlarger and cuticle destroying chemicals though, thank you very much. Its really unbelievable.


----------



## JPL (Jan 21, 2005)

Yup, my son has banked at TD CT most of his childhood and one day the teller simply asked him if he wanted a credit card, he said sure, (no job student) and 4 days later in the mail was his visa ($500 limit). LOL what a joke that was around the house. He buys something on the card and comes home goes online and pays the charge right away. His explanation, I may not have the money when the bill comes in, better to pay it now and easier than carrying cash. Whatever works I guess.


----------

