How does an 18-year-old with no credit history get a credit card?

One of the frequent reasons given for credit denial based on a credit report is: Too much available credit. Since we're talking about an 18-year-old hankering to build credit, I think this is a problem he/she would like to have. ;-) http://ask.metafilter.com/mefi/32868#513112nailed it for me. Thanks.

Thanks to all for the advice! To summarize the discussion up to this point for other readers: The message I'm getting is that lenders like Capital One and store cards are the best way for someone like me to get a real line of credit with no credit history. I'll try those, searching the newspaper for specific offers. If not, I'll go with a secured card. I'm also going to look into having the utility bills put in my name. I'm interested in using the float that a credit card offers because I very often make purchases for which I am reimbursed a few weeks later. I certainly do not plan to pile unnecessary purchases onto my credit card, nor do I plan to use it to artificially increase my standard of living. I understand the arguments against using credit, and I think that it's an important discussion to have, but I feel confident that I will be able to use credit responsibly enough. Also, just to clarify, I do not want to make daytrades on margin in my Scottrade account. I am simply interested in having the ability--though I may never exercise it--to sell short. That's not the primary reason I want to get credit, though.

frogan's advice is questionable. First of all, you wouldn't be approved for the cards based on what you wrote. As for throwing out all but one of the cards - that is credit suicide. Those cards still report to the CRAs as open credit lines with whatever amount you were given. When you go to get real credit for a car loan, etc. your fico score will be awful as your report would show a lot of available credit to you that will increase your rate on a car loan and even push you into denial territory. Whatever you do - don't get a bunch of cards and get available credit which will be reported to Equifax, Experian and TransUnion. As I said, that is credit suicide. http://www.creditboards.com/forums/ or other forums like it. You will learn a lot and get valuable assistance in establishing credit.

Put everything you possible can on your credit card once you get it. I was always very aware of how much money I had available and if any major expenses were coming up in the couple months ahead. Pay in full each month and use the float period to your advantage (time value of money). And I agree with those above that say that telephone bills aren't going to help with a credit rating. I can pay my bills with my credit card, from a credit rating point of view the bills can't really determine a good from bad debtor if they can be pushed off onto other forms of credit. Go to your bank, and see what credit card they recommend. They offered me what is probably effectively the same as a college card (high APR, low initial limit, had no trouble getting it out of high school with no job).

Those cards still report to the CRAs as open credit lines with whatever amount you were given. When you go to get real credit for a car loan, etc. your fico score will be awful as your report would show a lot of available credit to you that will increase your rate on a car loan and even push you into denial territory. No, no and no! It will show an open credit line with a ZERO balance. This is a GOOD thing when someone is starting out.

frogan, An open credit line with with a zero balance and $1000 in available credit means what? To a lender it means you have quick access to ready cash and possible heavy debt. It's the worst thing to show. From a credit lenders perspective those open lines of credit are no different than if they were actually all used to the max. One of the frequent reasons given for credit denial based on a credit report is: Too much available credit. The income/debt ratio is also calculated as income/credit availability. This is all basic stuff, really, and I would recommend you reading the credit card forums and other sources of information.

An open credit line with with a zero balance and $1000 in available credit means what?It means that the individual's ability to manage (make prudent decisions about) generous available credit is recognized. FICO likes to see a very large "cushion" of unused credit limit above the balance of each revolving account. If you're nowhere near maxing out any open cc account you have, you apparently are not desperate for money. You've been reliably meeting your financial commitments without having to run up disproportionately high cc balances. On the other hand, using most* of the credit line of one or more accounts is considered by FICO to indicate an increased risk that the individual may be getting overextended and might be more likely to default in future. (*Most = 50% or more of the credit limit) On the other hand, a particular lender who is considering extending a large loan amount may request or require that one close down part of one's available credit in order to be approved for the new loan. That lender is gauging whether one would be able to pay the new loan plus all the other monthly payments, if one decided to max out the other accounts (Which is a HUGE possibility with for an 18 year old with no credit history). However, shutting down available credit is likely lower one's score somewhat. Found and paraphrased from one of the gazillion manage your credit sites on the web. They all basically say the same thing. Of course, individual circumstance's may vary ;) Even Experian notes that you can possibly increase your credit score by opening accounts and not using them, but they don't recommned it.

This is categorically incorrect. While it is true that you can possibly get through life without credit card or loan debt, if and when the time comes for you to buy a house, you will be greatly helped by a lengthy and solid credit history, including a successfully handled credit card account and at least one car loan. A top-notch credit rating often means you qualify for loans and rates that most others aren't even offered. Categorically incorrect? This is only false for lenders who rely on FICO only mortgage calculations. For manual underwriting, a FICO score isn't necessary at all. A solid record of paying your landlord early or on time, and having MONEY are the only two things truly needed for a mortgage. You have more money without debt. Therefore, it is certainly NOT categorically incorrect. It is false if you only deal with lazy lenders. I understand the belief that you can handle the card, that you won't spend more than you pay off....but that's not what happens with 99% of people.

Also, just to clarify, I do not want to make daytrades on margin in my Scottrade account. I am simply interested in having the ability--though I may never exercise it--to sell short. And just to clarify - I still think this is absurd. Selling short - which opens you to unlimited losses if the stock increases in value - is gambling unless you have insider information, in which case it's illegal. Suppose someone were to say to you "I'd like to establish a $5,000 line of credit with Harrah's, in case I decide to fly to Las Vegas and gamble. I don't plan to do this, but I just want to have the ability." Would you think "Sure, why not - that's the sort of thing any about-to-turn-18 year old should aspire to."?