How to Build Your Credit score on Equifax, Transunion and Experian credit reporting agencies

Having good credit is essential if you want anything good these days. You need credit to buy a house, get an apartment, buy a car, get a cell phone… and the list goes on and on… Hell, these days, you need good credit to even be employed by some companies!

So how do you build your credit?

Difficulty: Moderately Challenging

Instructions

Things You'll Need:

• Sign up for accounts at all three credit reporting agencies - free signup.

1. 

   Check your credit report. You are able to get a copy of your report for free once in a 365 day period. You need to know exactly what’s on it. There are three major bureaus: Experian, Equifax and Transunion. You can get a free copy of all three at AnnualCreditReport.com.
   
   TTBirdie has a great article on how to get your report from this website, titled: "How to Get a Free Credit Report" and the link to the article is below in the resources section.

2. 

   Open a checking and savings account.
   
   This is a step to building credit that many people do not consider. A checking and savings account that is in good standing, is a sign of stability. The longer you have your account and keep a positive balance, the more stability you show, however, this isn’t a guarantee of approval for loans or credit cards.

3. 

   Credit report score basics:
   
   There are two major factors in a credit score.
   
   1. If you have paid your bills on time, and are continuing to do so
   2. How much credit do you actually use out of what is available to you.
   
   Paying bills is the single most important thing you can do to build credit. Set up auto pay if necessary! Never ever be late. Send a payment overnight if you have to.
   
   Never use all of the available credit on any credit card. I personally try not to go over 50% on any given month, and try to pay the total balance by the next. I do keep $20 in a balance in the accounts to boost the score for being a “good buyer”. Some sources say this is not necessary, but the credit card companies love it and they keep increasing the limits (this boosts your available balance and shows a lower amount of the available balance that you actually use).

4. Secured Credit Cards:
   
   Applying for a secure card is good if you cannot get a regular one. A secured credit card is one that you pay a deposit to the lender for, and they give you are card with a credit limit that is usually equal to the deposit amount.
   
   Be very careful and read all of the credit card lender’s fine print. Some of these cards have insanely high annual fees or interest rates. Also be aware of the over limit fees and overdraft fees, as they can be high too. Make sure the issuer reports to the credit agencies, or having a secured card will do no good.
   
   As soon as you build some credit, switch to a regular card with lower interest, little to no annual fee and over the limit protection.

5. Get a Gas card or Store card. These are usually easier to get and go through finance companies rather than banks. Often, they don’t do much for your credit, but can help a little.

Resources

• AnnualCreditReport.com
• How to Get a Free Credit Report

[ttbirdie]

on 4/3/2009 Excellent tips, this can be a long hard road, I know. But it can be done. 5*