| A parent can get a credit card with a child - parent co-signs and is responsible if child doesn't pay up, but I think it builds a credit history for child because only child's name is on card and statement, and the credit limit is low (but higher than $100). The problem with a child having a card for parents' account, as we just learned, is that the child gets to have that same credit limit - you can't impose a lower one on your child. This came up recently when d. was going on school trip - we wanted her to have the flexibility of credit card but had to have the high limit. There are some kids for whom the temptation would be too great.
I wonder, though, whether a credit card to build a credit rating would even help in the OP's situation. Aren't PLUS loans, like most consumer loans, given out on the basis of a borrower's ability to pay back the loan? Since the borrower would be a full time student, I don't see how any bank would take the risk. The Stafford loans are intended, I think, precisely for that situation. They are available to any full time student (in either subsidized or unsubsidized flavors) but the limits are fairly low, making them low risk to the lending banks (and they're guaranteed by the feds anyway). I think the OP should ask a banker about this - how would a student go about building credit or otherwise make themselves eligible to take out PLUS loans on their own? My guess is that a student cannot (a married student with working spouse might be different).
It's the big paradox of loans/banking - those who have money and better credit ratings get lower interest rates. Those who REALLY need the money either don't qualify or pay more for the privilege. Of course, it's because it's all based on the risk taken by the lender. |