No matter how old you are -- if you do not have what is called a credit history -- obtaining credit, at first, can be a frustrating experience. Lenders, Banks, Creditors these are the people who issue the credit --and they all want to see proof (a credit history) that you pay your bills and that you pay them on time.

This can be a Catch 22 if you have never had credit before. How do you show a credit history when no one wants to give you credit to start out with?!

I remember when I was 19 I applied for my first credit card. It was a Visa card - I filled out the application - answered all the questions - made sure I printed everything neatly. Put it all in the envelope - put the stamp on it and as I was dropping it in the mailbox - I was so excited that I was now on my way to having a credit card!

I felt like I was in the big league -- I had a full time job and now I was going to have credit!

A few weeks later I received mail from the bank - I was Denied. Denied?! I was so upset. How could they deny me this credit? I was working full time - I was a reliable person - I was a good person! Why wouldn't they give me credit?

The reason was simple - No past credit history~ I borrowed money from my parents many times -- but they don't submit a credit report on me ?. so they don't count. Well -- how could I have a credit history - how could I prove I would pay them back if someone, other than my parents, wouldn't give me the money to start with?

I did 2 things to overcome this situation -- First since I had a saving account with a few hundred dollars in it. I applied for a savings account loan. Now at the time I didn't need a loan but I got it anyway so I could start to establish this credit history. Since this money was actually my money sitting in the bank - I was able to get that loan. I then paid that loan back within a few months - I had to do this over a few months so my credit report would show these monthly payments. These monthly payments are what makes a credit history.

The next thing I did was get a department store credit card. Usually department store credit cards are easier to get than bank cards.

6 months after doing this -- I applied, again, for a Visa card. Though I must say I was not as excited this time and I was a little jaded - after all these folks had actually rejected me.

A few weeks later an envelope came from the bank and in there was the credit card I had been wanting!

That was years ago - but obtaining credit is not much different. Lender's still want to see that credit history. What is different today is the types of credit cards you can obtain.
* Student credit cards for people who are in college. Banks are willing to take the so-called risk with the idea in mind that people who graduate from college will earn a higher income than others.
* Secured credit cards which are basically the same idea as that loan I took against my savings account. Using these cards is a great way to get a credit history