College students tend to be fertile targets for credit card marketers. While issuers' access to campus has been impeded by federal regulations, it’s still common to find marketers touting their cards to students at other events or via mailings. Students may have an easier time getting low-limit cards than older applicants with no credit or poor credit, because the issuers hope to get students loyal to their cards, and the students will presumably have greater earning potential once they graduate.
The Credit CARD Act of 2009 increased the restrictions on marketing tactics that credit card issuers can use to target students. Issuers aren’t supposed to grant a credit card to anyone under 21 unless the applicant has the means to repay what he charges. This generally means a student has to have a job, though some issuers have a more liberal definition of “means to repay.” You may be able to win approval if you can show you receive a regular allowance or if you have student loans that you use to fund expenses.
Students can benefit from being authorized users on a family member’s account, or by asking someone to cosign a card application. In both cases, you’re using an established credit card holder to jump-start your own credit history. A parent can add you as an authorized user, for example, and get you a credit card linked to her account. Anything you charge gets billed to her account, but the payments appear on your record as well. With a cosigned card, someone with more established credit joins your application and agrees to be responsible for the bills if you don’t pay them.
Terms are Critical
If you’re unemployed and don’t have a job lined up for the end of the academic year, pay particular attention to interest rates. Any amount you charge may remain on your account a long time, racking up interest fees, if you don’t have enough cash to pay more than the minimum due each month. Also look for cards that have a low annual fee and no recurring monthly charges, or your credit line may be eaten away by something other than purchases.