When it comes to building credit, you will be bombarded by multiple “how to’s” and tips and tricks to start building and refining your credit. In todays blog, we will go over the easiest and safest ways for a new consumer to start building and refining their credit.
Step One: Getting A Copy Of Your Report
Before you begin building your credit, you are going to want to find a get ways that you can reliably pull a copy of all three bureau reports. Outside of pulling your annual credit report from annualcreditreport.com you can also pull all three-bureau reports easily here at Credit Armor once a month! You are going to want to have access to your credit report when you need it so that you can track your payments and guard yourself against false accounts and identity theft.
Step Two: Speak With Your Bank
When it comes to acquiring a credit card, your bank is going to be the easiest way to find a lender. Now, if you have no credit established, the only ways you are going to secure any sort of card is with a secured credit card. A secured credit card is provided by your bank and works in a similar way to a debit card. The idea is that you have a set limit on your secured card and that limit is set aside in a separate account. This means that you will always have the funds to pay back your credit card while establishing good credit history.
Step Three: The Buddy System
Now this step is only meant to be done with someone you trust but becoming an authorized user on a positive credit account can help boost your credit. Finding a family member that you trust and has a great payment history to add you onto their account will share subsequent positive history with you. However, this also means that and negative history (such as overdue payments or high balances) can also hinder you and can potentially drop your score. The same also goes for cosigning on a vehicle or home loan. If one member of the party fails to make payments, then the other will face the consequences as well.
Step Four: Build and Build
As you progress towards a year of building your credit with a positive payment history, you will soon begin receiving offers for new lines of credit. Keep an eye out and research some of the best card options that fit your needs and offer any bonuses you want. The same thing applies to these unsecured cards as it did with your secured card; make sure you are making your payment on time and keep your credit utilization as low as possible. The longer your cards are open with positive credit history report, the more your score will continue to climb!