If you have never had credit before, you have no credit record. Most major credit card companies will not give you a credit card when you are in this situation. Apply for a local department store credit card and a gas card. If you can qualify for one of these cards, you can use it to build up a credit record. After you have built up a credit record you can reapply for a Visa or MasterCard. If you are turned down for a gas card or department store card your only choice may be to apply for a secured credit card.
Your credit record is more important today than it was in the past. These days insurance companies check your record and can charge you a hire rate if you have bad credit. If you try to rent an apartment they will check your credit record. Even employers are now often checking credit records before they hire new employees.
When you try to buy a house or a car, having a good credit record will allow you to qualify for a lower interest rate. This can save you thousands of dollars. If unfortunate circumstances have caused your credit record to go south you need to work towards improving it.
If you are a US citizen, over 18 and have a job you should be able to qualify for a prepaid or stored value card. You can only spend the amount you have transferred to the card. There is no credit extended, but this type of card can be used just like a credit card. You can shop online, buy gas, save it for emergencies or use it just about anywhere Visa & Mastercard are accepted.
Many people that have racked up huge credit card debt in the past declared bankruptcy. With a chapter 7 bankruptcy the persons assets are liquidated to pay the creditors and the remaining debts were often cancelled. Many people who filed for chapter 7 bankruptcy had no assets to liquidate. That often resulted in the credit card companies getting none of their money back. Needless to say a credit card company can't stay in business if it doesn't get back the money it loans out. To recoup their losses they charge high interest rates to people with bad credit ratings. Being irresponsible with your debt hurts everyone, not just the credit card company or yourself. Think before you buy and use credit responsibly.
A new bankruptcy law goes into effect October of 2005. This will make it much harder for people to avoid paying their debts.
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