Question: dept store cards? No fee visa mc? Frequency and volume of purchases over what period? Types of purchases? Sizes of individual purchases? Variety of types of transactions or payees? If you can get a visa or mastercard, use it often, and pay it in full. If you have the choice between paying cash or using your card, use your card, then pay it in full – especially if it’s a large purchase, say over $500. This begins to establish you as having enough money. The paradox of credit is that they want to give it to people who don’t need it. If you NEED it, you are likely not to get it… If you have say 2 visas and 2 mastercards, from different banks, and use them all and pay them all on time, that establishes credit. If you can’t get a credit card, get a secured one (where you put money in an account equal to the line of “credit”) and use that and pay it off each month. I’m not SURE whether carrying a balance helps establish credit, but I think it does, as long as it’s not more than say half of your credit line… and then if you pay that off after a few months rather than making minimum payments… IF you get a secured card, make sure that it is one that reports to credit bureaus. I would first try to get one through your own bank, though it really doesn’t matter. Also watch out for the secure credit card sharks who sometimes charge up to $100 for an “application fee” or charge 22% or higher interest. Read the fine print!
Another method to establish credit is to ask for a personal loan from several banks. Then pay them all off on a monthly basis. Make sure there is no pre-payment penalty. You may pay for this in interest charges, but it will help you establish credit.
Answer: If you can get a visa or mastercard, use it often, and pay it in full. If you have the choice between paying cash or using your card, use your card, then pay it in full – especially if it’s a large purchase, say over $500. This begins to establish you as having enough money. The paradox of credit is that they want to give it to people who don’t need it. If you NEED it, you are likely not to get it… If you have say 2 visas and 2 mastercards, from different banks, and use them all and pay them all on time, that establishes credit. If you can’t get a credit card, get a secured one (where you put money in an account equal to the line of “credit”) and use that and pay it off each month. I’m not SURE whether carrying a balance helps establish credit, but I think it does, as long as it’s not more than say half of your credit line… and then if you pay that off after a few months rather than making minimum payments… IF you get a secured card, make sure that it is one that reports to credit bureaus. I would first try to get one through your own bank, though it really doesn’t matter. Also watch out for the secure credit card sharks who sometimes charge up to $100 for an “application fee” or charge 22% or higher interest. Read the fine print!
Another method to establish credit is to ask for a personal loan from several banks. Then pay them all off on a monthly basis. Make sure there is no pre-payment penalty. You may pay for this in interest charges, but it will help you establish credit.
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