Build Credit FAST With Little or No Credit
Having good credit is just one of those things you can’t live without.
Whether you are looking to finance a car, buy or rent a home, or even apply for a new job, your credit profile plays a deciding role factoring you’re approval and represents you and you’re financial responsibility. Even with the negative stigma, credit cards can be a useful tool to those who can use them responsibly.
If you are looking to build your credit FAST with little or no credit ..
Apply for a SECURED Credit Card
Chances are, if you are reading this blog you either are trying to recover from a low credit score, or you are looking to build from scratch. Whatever the circumstances, if you’re experiencing a difficult time getting approved for a credit line, you may want to start with a secured credit card.
Secured cards work just like regular credit cards, only you have to place a refundable deposit down in order to receive one. The deposit may very depending on the issuer and applicants credit rating, but typically range between $200-$500 down. Other than the deposit upon approval, secured credit cards work just like regular credit cards and report to the 3 major bureaus (Equifax, TransUnion, Experian), and comes with monthly bills and minimum payments.
Pay Your Monthly Bill On-Time
It’s important to treat a secured card just like a regular monthly bill, and pay your balance on time every month. Missed or late payments WILL report to the bureaus and you can expect to see a quick decrease in your scores. Of course we always recommend paying MORE then your minimum monthly payments to keep your debt ratio low. Try making small purchases that you know you can afford when the bill arrives and pay off in FULL to see a nice increase in scores. Almost all banks and credit lenders offer automatic payments to debit your checking account so you don’t miss a payment.
If you can’t afford your minimum payments, click here for useful advice on how to avoid a missed or late payment reporting on your profile.
Prepare Yourself and Your Credit
Before applying for ANY sort of loan or credit, make sure your reports are all positive and looking their best. Limit yourself on applying for credit, every time you apply, you authorize the creditor to pull and review your credit report and a hard (or soft) inquiry lands on your report which can actually HURT your scores.
Pulling your own credit does NOT count as an inquiry and will never hurt your credit. We always recommend using credit monitoring to insure nothing fraudulent, incorrect, or negative is reporting.
Apply for a UNSECURED Credit Card
Once you have built your credit to a satisfactory score, you should qualify for a unsecured credit line through your bank or credit union. Take your time shopping around for a card that offers the best APR and rewards with no annual fee. *Keep in mind* cancelling any open line of credit WILL impact your credit profile significantly,keep your SECURED card open, and find an UNSECURED card that you can and will be happy with.
Ask for a Credit Limit Increase
Once you have established a good relationship and standing with your creditor, ask for a credit limit increase! A good utilization ratio will help you maintain a healthy profile, the higher the utilization ratio, the higher your credit score will be!
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