Hard credit pull twice in 3 months by Amex

When I had applied for a free American express credit card offered by Costco, I had almost no credit history. So, I was rejected. But after about 3 months, when I had build some credit history, they called me and told me they needed some information from me in order to provide me the card. Within a week I received the card. The card offers upto 2% cashback rewards so I gladly accepted it. But when I checked my credit report, it had two hard credit enquiries from them which will last on my credit report for 2 years. The hard enquiry was done on all the three credit reports, ie, Equifax, Trans Union and Experian.

The first enquiry was made when I had applied for the costco membership along with the free Amex credit card. The second one was made when they offered it to me themselves. The sad part is that once my Costco membership expires, I will no longer be able to use the free American express card unless I decide to renew my Costco membership. And the saddest part is the credit enquiry will last longer on my credit report, than the card itself.

5 ways to make sure your bank does'nt rip you off !

Before opening a new account, you need to take care of a few things-

• Read the fine print carefully. There might be a monthly fees or minimum balance restriction.
  

• Check the fee schedule of the bank. Find out the wire transfer fees, ATM fees, etc.

• Some small banks might do a hard credit inquiry for even opening a CD if you do not have an account with them already. So you need to go through that application form thoroughly enough to make sure that you are not authorizing them for your hard credit inquiry, instead of blindly following the bank marketing guy.
  

• Some banks charge you a closure fees (eg, netbank), so before opening an account, find out their closure policy. A few banks might charge you an early closure fees, eg, if you close an account within six months.

• Make a note of each transaction you make and each check that you write. With some banks it might take a few days before your transaction shows up in the account. During that period, you might believe that you have more funds in the bank than there actually are (unless you have recorded the transaction when you made it.) For example,

1. You had $1000 in your account on 1^st August.
2. You wrote a check of $500 on 2^nd august to Mr A.
3. You spend $300 on shopping on 3^rd August.
4. But your available balance in the bank still shows $700 instead of $200 on 3^rd august.

Now if you forgot about the check that you had written and spend over $200, you will be charged an overdraft fee by your bank.

Hope this would help you make your banking experience more enjoyable!

What to do if no credit history?

So what should the people with no credit history do? They don’t get credit card because they don’t have a credit history. The banks reject them because of the same reason. No one gives them a loan. So what do you do? Unless you get a credit card, you can’t build a credit history. And the irony is that you need a credit history to have a credit card. So, how do you break this vicious circle? There are a few creditors who offer credit cards or loans to people with no credit history or bad credit but they ask for a high annual fees and outrageous interest rates.

In my opinion, a good way to start your credit history is by getting a secured credit card. In a secured credit card, the amount you deposit in the bank as a security sets your credit line. For example, if you deposit $300 in the bank, you get a secured credit card with a credit limit of $300. As you use the card and make payments, you establish a credit history. Although these cards have high interest rates and some annual fees, they would be helpful to those who pay their entire credit card bills on time. Once you get a secured credit card, you can increase its credit limit later. Make sure the credit card company reports to a credit bureau before applying for a secured card. Once you have a secured credit card, you need to make sure that you pay all your bills in time. After a few months you should be able to obtain a regular credit card.

Another way would be to check if your organization is a member of federal credit union. If yes, you could probably get a card from them.

Applying to a number of credit cards in a short period of time can decrease your chances of getting approved. So pick and choose credit cards carefully and apply only to cards whose requirements you are likely to meet. You can do that by calling the card company to make sure your income and other factors qualify you for the card.

In order to rent a home, you might have your credit history checked. The best way here would be to co-sign with a friend or relative who has a good credit history.

While taking a loan, you can consider a cosigned loan as well. With a cosigned loan, your cosigner is equally liable for the balance.

Don't worry, within a year you would build your own credit history !!!

Free credit report is not free

One of my friends was about to order his credit report recently from freecreditreport.com under the impression that it is free as suggested by the name. Many people make the same mistake. Well, actually the fact is that when you order a report from them, you begin your free trial membership in Triple Advantage^SM Credit Monitoring. If you don't cancel your membership within the 30-day trial period, you will be billed $12.95 for each month that you continue your membership. Although they do mention this on their site but most people miss it due to the color combinations that they have used.

Freecreditreport.com is not affiliated with the annual free credit report program. Please be aware that under Federal law, you have the right to receive a free copy of your credit report once every 12 months from each of the three nationwide consumer reporting companies. To request your actual free annual report under the law, you must go to www.annualcreditreport.com.

Now I have a credit limit of $3000

I kept all my money in one account. But my checking account was not paying me any interest. So I decided to open an account that provided me some benefit. While doing so, I came across, another site while provide me information on banks that would pay you bonus for opening an account with them. I decided to open an account with Citibank, since they were offering a $200 bonus. But just then I came across a site which told me that this bank does a hard credit pull which can decrease your credit score. Thanks for saving my score from getting lowered further. So I decided to open an account with another bank instead. I also opened a ING savings account that can provide me with a good interest.

By this time I had increased the limit of my secured credit card from $400 to $700. I could have increased it further, but I did not want to keep more money locked into the prepaid credit card. I made sure that I paid all my bills on time and did not miss any payment.

Suddenly, I got a call from Amex regarding my application for credit card. Why are they calling me now? They had already refused me 3 months back ! Anyway, they asked for some information which I provided them and after about a week I received a card from them with a limit of $800. I believe that the reason that I got the amex card for the limit of $800 was because I already had a credit card with a limit of almost that amount. I then decided to increase my credit limit of my secured credit card from $700 to $2200. So now I have two credit cards with a total limit of $3000…which I m quite happy with. Hope this will improve my credit score further. I can further increase my limit of secured card any given day….

I got a prepaid credit card of $400

After being turned down twice, I came to know that I can get a secured credit card…..i.e., a prepaid credit card. I decided to apply for it. I went to a reputed bank near my house and applied for the card. They told me that if they approve me, I will get a secured credit card in a month or so. I kept my fingers crossed. Finally after a month, I did get my card. Although the limit of the card was $400 only, I decided to use it wisely to build my score. Everytime I was about to reach $300, (which happened almost every 3-4 days since I needed to buy a lot of stuff initially), I paid off my credit card bill. So by the end of the month I had actually paid $3000 through my credit card with a limit of just $400 !!

To make it more clear-

1^st mar- used $200

2^nd mar – used $50

3^rd mar- used $50

3^rd march- Paid $300 credit card bill

4^th mar- used $100

5^th mar – used $100

6^th mar- used $100

6^th march - Paid $300 credit card bill

And so on.

I was rejected a $300 credit card

When I moved to US, obviously I had no credit score. I knew I had to build one. I came to know that the simplest way to start building a credit is by having a credit card. So when I went to Costco for some shopping and got their membership, I also applied for the free American Express card that they were offering. After waiting for a minute, they told me that I was rejected and could not get their credit card. I was totally embarrassed and shocked to hear that. When I was in my country, I used to get phone calls for credit card offers all the time and I used to yell at their sales people for disturbing me. And now I cant even get a credit card from a shopping mall? What a irony!

I still needed a credit card. So this time I applied for a $300 credit card. I was turned down once again!

Since I had very little money at that point and I needed to buy a car, I needed to get loan for the car. Now I was a bit scared. What if they reject it again? But I found out from many advertisements that there were companies who were willing to offer you a credit even if you have a bad credit history. THE CATCH? They were charging a very high interest rate. I did not want to get into their trap. So I decided to get a used car instead.