What Is the Best Way To Build Your Credit When You Have None?
If you have been told that you need to get credit if you want to have credit, then this can be incredibly frustrating. Some of the major milestones in life such as purchasing a car, purchasing a house, and taking out education loans will require a relatively high credit score. On the other hand, if your credit score is low (or nonexistent), you might have a hard time applying for these loans successfully. Fortunately, there are a few ways that you can build credit even if you currently have none.
1. Get Approved as an Authorized User
Think about getting approved as an authorized user on a family member or friend’s credit card. You can use the primary account holder credit card and build your own credit history. Furthermore, you will not have any liability, so this is a relatively low-risk way to start your credit history.
Of course, you have to make sure that your family member or friend is comfortable with this arrangement and that he or she uses his or her credit card responsibly. You don’t want to end up as an authorized user on the account that has a history of late or missed payments, as this could impact your credit score as well.
2. Apply for a Secured Credit Card
Another option that you may want to consider is getting your own credit card. A secured credit card is another low-risk way that you can build extra on credit history. You will deposit money into an account and the amount of money you deposit is the limit of the credit card. Therefore, you don’t have to worry about overspending your credit limit. Try to find a secured credit card that does not have an annual fee.
3. Pay Your Monthly Bills on Time
Even if you do not have a major loan, such as a home loan, you may still have cell phone bills, internet bills, and other utility bills that recur monthly. Make sure that you pay all of these bills on time, every time. There are services available that will provide you with credit for paying your return bills on time, helping you build a strong credit score.
Build a Strong Credit Score from the Ground Up
These are a few of the top ways that you can build a strong credit score even if you are starting from zero. The more bills you pay on time, the higher your credit score is going to go. Then, you will be able to apply for more competitive, larger loans. For help with credit building, rely on Key Credit Repair to help you with all of your credit repair and improvement needs. Give us a call today!