Posts Tagged ‘start building credit score’

Can I Quickly Establish My Credit Score? How?

Many people who do not have a credit history at all sometimes ask questions like “can I start my credit score?” The answer is a big yes. There are plenty of different ways out there that you can try to establish and build a more than decent credit report. Having a good report matters a lot, especially in the present day world, where life of an average American consumer runs on credit. Your ability to obtain better offers on credit cards, mortgages, insurance policies, car loans, or personal loan depends mainly on how good your FICO score is. If you are looking for a home on rent, even the landlord will first look into your credit report to determine your eligibility to become a tenant. What is more, utility service providers also check this report to decide whether they should offer their services to you or not; if yes, whether they should ask for a hefty amount of security deposit. For example, with a bad credit score, your application to get a new phone connection can straightaway be rejected. Considering all these facts, it is really nice that now you want to start and build your credit. Following are the seven simple steps you can take to do just that.

Get A Checking Or Savings Account Opened In Your Name

You are not the first one; there are many people who keep thinking, “I must start my credit score now”, but they just keep on thinking and never take an action in this direction. Unless you start making an attempt, you will reach nowhere. Therefore, the first thing you have to do is to stop beating yourself up for not having any credit record at all. Don’t panic. Before you start getting credit, you must first get a checking or savings account opened in your name. You can open this account either with a Credit Union or with a bank.

Build A Good Employment History

You will also need a good employment record to maximize your chances of getting your credit applications approved. Therefore, if you are jobless, you must first get a job, something that should earn you a regular monthly income. Do not start making credit applications right away. Give yourself some time, at least 3 to 6 months. During this time period, you must focus on maintaining steady employment. Your employment history and the amount of money you earn every month will determine how quickly you can start and build your FICO score.

Start With Secured Credit

You must be wondering “who will give me credit even with good employment record when my credit score is still zero?” Your concern is typically not wrong. You may still be denied for unsecured credit, such as a personal loan. That is the reason why it is always better to start with secured credit. For example, you can easily obtain a secured credit card by making a certain amount of security deposit, such as of $500. Likewise, obtaining a mortgage loan should also not be a big problem because it is also a secured lending program, where the home you purchase is put as collateral against the money you borrow as part of the mortgage.

Apply For Utility Services

Another easy way to obtain your first line of credit is by applying for some utility services in your name. With a good employment required, you should not have much difficulty in getting an electricity connection, a telephone connection, or just any other utility service. The idea is to be current with all your bill payments because this is your opportunity to show that you can take a financial responsibility very well.

Do Not Make Defaults

With utility services in your name and with a good employment history, you can also qualify for other mainstream loan programs also, such as personal loan or others. No matter which type of loan program you go for (obviously that will depend on your specific needs and requirements), you must make all monthly payments in a timely manner. If you fail to make the payments within the due dates, you will still start building your credit score, but in a negative way.

Many people get so obsessed with the task of building and improving FICO score that they start thinking like this – “I will do anything to establish and boost my credit score”. Make sure you do not build up an obsession like this. Never borrow a loan or obtain any other form of credit just for the sake of building a high score. Do it only when you really need it. In brief, do not look for shortcuts. Be slow and steady – do it the natural way.

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