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tehbrownie

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Declined because of lack of credit history. What to do?
I know CreditKarma may not be the best source to base my decisions of off, but I decided to use it and try to apply for a credit card. Just some background on my CreditKarma report: - Credit Utilization: 4% - Payment History: 100% - Derogatory Marks: 0 - Age of Credit History: 2 years, 6 months - Total Accounts: 4 - Credit Inquiries: 1

I decided to apply for the Chase Freedom Unlimited card last week, and after waiting, I got a letter saying that I was declined. Reason being that I lack enough open accounts to establish a credit history. This surprised me a bit, to be honest. I've been an authorized user on my parent's credit cards for 6+ years, and 8 months ago, opened a store branded visa card, in which I can use to make purchases anywhere. My parents have no debt, and always pay bills on time. I treat my credit card like a debit card. I only spend if I can pay it back. I also always keep my utilization on my own card under 10% (CL of 5000). Every month on the due date, I don't just pay the statement balance, I pay the full balance on the card. I decided to call the reconsideration line for Chase, and when I spoke to the woman, she said that she couldn't do anything. What's worse, I even went in to the Chase bank and talked to the banker whom I had applied for the credit card with. He told me that I should open a credit card with a store and build credit with that. I told him that I already had done that for the past 8 months. When I told him that I pay back the card in full every single month, he told me that I was doing it wrong. He told me that if my balance was $200 by the due date, that I should pay $199 just to show that I'm using credit. What kind of advice is that? He literally told me that I should generate interest when I don't have to.

My question is, what should I do at this point? I'm going to keep using my store visa card, but is there anything else I can do to build my credit history? The advice that the banker gave me seemed so wrong.

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Top Contributor
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The banker was correct.  ONLY pay the balance due as shown on the bill each month.  You will not be charged interest on what remains.  Please take the time to read the articles here so you can learn exactly how credit works.  I sure did, and I have a degree in business.  .    

Top Contributor
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I am surprised that you were declined on your request based on your information as your information was better then mine when I was approved, however, your actual score, which you did not reflect could have been an impact.  You should continue on the path that you are currently on and allow time to be on your side.   The banker was not correct, if he was referring to your statement being $200 and paying $199.   This only applies if you are working with the reporting date and not with the statement date.   Once the statement is prepared, you should in fact pay the balance in full.   Its the reported information to the bureau that is used to compute your score, not how much you carry from month to month on the card itself.  Perhaps the difference on my approval was that I replied to their offer they sent in the mail as opposed to using the recommendation here on CK.

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