Easy ways to build credit from scratch
The world runs on credit. If you are looking to make big purchases in your life, such as a house or a car, you need to have a good credit score in order for lenders to know you have been able to pay your bills. The topic of having bad credit gets talked about a lot, but what if you have no credit at all? Maybe you’re fresh out of college and looking to make the transition into life after school, or maybe you’ve just always paid cash for your items and never found a use for credit. Whatever the case may be, we want to talk about some of the easy ways to build credit from scratch that may help you out in financial situations in the future. While this is not a replacement for advice from your financial expert, it’s a good place to start.
Steps for starting your credit
- If you have any bills to pay, make sure you pay them on time. Some on-time payments can be reported to the credit bureau and put you on record for being a reliable bill-payer.
- Sign up for a secured credit card, which is one for which you make a deposit with cash up front to back up the card. Use it as if you would use any other credit card and making payments to it on time will get you on the upward trend with credit.
- Keep any credit balances low rather than having them be consistently near the top of your credit limit.
- Have someone you know and trust co-sign a loan or credit card application. Make sure they understand that they would be entirely responsible for any balances owed if you are unable to pay. That said, this can help give you the credit-building boost you need.
- If you are in the market for a new-to-you automobile, finance with J.D. Byrider. You can finance here even with no credit history, and your on-time payments can help get your credit history started out properly.
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