Things You'll Need:
- Job (Recommended)
- Bank
- Credit Card (optional)
- House (optional)
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Step 1
Bank Accounts - If you do not have any credit score rating or if you have a bad credit score this is a great place to start because opening a bank account does not require anyone to have a credit score. Bank accounts are not reported to the 3 main credit bureaus, but a banking history is looked at when asking for a loan. This is a first step in becoming financial sound and establishing a good impression on lenders. Lenders like to see that you can manage your money correctly.
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Step 2
Employee History - Lenders tend to look at your employment history to decide your risk level. If you have had stable jobs then your risk level will be lower, compared to people who have not been able to hold a job for long periods. This is viewed as a risk because if you cannot hold a job then that means that you might not be able to pay back your loan.
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Step 3
Residence History - Lenders like to see that you have been in one location for a period of time. This is viewed as more stable than someone who rents, or moves around often. Owning a home and paying the mortgage on time will make a better impression on the lender and could help your chances of getting approved for the loan.
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Step 4
Utilities In Your Name - If you rent or have roommates a good idea is to get the utilities in your name. Even without a credit history having a history of bills in your name (as long as you pay them!!!) is a great way to start to build credit. Just having your name on these accounts won’t establish a credit score or a credit history, but if you are starting out it gives a history to look at for the lenders.
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Step 5
Things Not To Do!
*Do NOT Open a Department Store Card - The more cards you open the more your FICO score will fall. The rule of thumb is to have no more than 2 or 3 cards. You have to be disciplined if you are going to open one of these cards. They are very easy to open and you will be pressured by salesmen that are on commission.
*NEVER Pay A Credit Card Off with Another Credit Card - If you are doing this not only will it magnify your interest rates but this is a MAJOR sign to seek advice. If you are at this point you need to seek financial advice and think about consolidating your loans.
Comments
chenderson00 said
on 12/2/2008 I needed this a lot. lol I have no credit, therefore I'm told "I can't get credit". Now, I know what I can and will do! 5*s