How should I apply for another credit card after being denied twice already?
I'm trying to get my first credit card solely to build a score, I don't need any loan or anything right now. For doing this, I applied to Chase two months ago (because I've had a debit card from them), and got a denial. After a little searching, I came to know that Chase is not giving credit card accounts for the first timers.
A month after that I talked to a Capital One representative and explained everything by saying "I don't have any credit score and I'm applying for the first time". And he recommended a Capital One Student Journey. After 2 weeks I got denied. The reason was no enough credit history! I guess that representative is new or doesn't know the stuff...
After calling them back and explaining everything, they told me I need to apply for secured credit card.
After researching little bit, I found that applying frequently can make a trouble for credit approval. How is this true? Does it apply to secured credit cards (and for the first time applicants)?
Can I apply for the secured one after applying twice in 2 months?
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It is true that too many credit pulls on your record will lower your score and chances of getting approved. It shows you as a desperate person seeking for debt ASAP, and it is not what you really are. Banks don't like desperate people seeking for debt ASAP, because bankruptcy is the next logical step for those people. Don't make yourself appear as you're in that category, its not good for your financial reputation.
Secured credit card is indeed the way to go for you, and is the most straightforward way to build credit if you don't have any or have a bad one.
Secured credit cards are much easier to get, since they're secured by a collateral (usually a CD you open with the issuing bank). Your credit limit is limited by the amount of that collateral, so the issuer doesn't actually extend you any credit and there's no risk for them. It is reported as credit on your report though, so it allows building credit history.
I wrote an article on my blog about building new credit, that addresses your situation exactly, you're welcome to browse through.
Credit score is made of several factors with payment history, credit mix (different types of credit), and credit utilization being three important pieces of the pie. You have a student loan, which helps with the credit mix, credit age, and as you pay on-time with the payment history.
There are four types of credit you need for credit mix. Mortgage (not yet), Installment (auto loan), Revolving (credit cards), and Student loans. You will want to get between 2-4 credit cards once you have enough credit score to obtain good ones. I would recommend delaying credit cards until you have improved your credit file (credit age and history). An installment loan would be a good start.
Secured cards are often recommended, but often have high costs. As another respondent suggested them, I will defer to them.
Banks have been having really good experience with payment history and low default rates on auto loans over the past couple of years (much better than credit cards), so you might consider an auto loan as one approach to building credit. A good used car with a sizeable down payment would add an installment loan to your credit file. Some would recommend a new car, but I won't recommend that for the depreciation, etc.
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