No credit? - How to build credit
30/03/09
Are you young and just starting out? Or maybe you have neglected to establish a credit profile and opted to pay for everything with cash instead and now you need a mortgage. And finally, maybe you’re in the group of people who have recently moved to the US for one reason or another and you need to establish credit ASAP. The following is how we’ve helped people just like you build a credit profile. We must warn you that it will take a little work and that you must visit several banks in order to get the process going. Building your credit does not have to be a mystery any longer.
Step 1- Make a list of several local credit unions and banks within driving distance. Call each one of these banks and CU and check if they a) do saving secured loans b) report to the credit agencies. If the answer is yes to both, give them a visit and set up a savings secured loan.
What is a savings secured loan? It is a loan made by a bank or credit based on how much money you have with them. First you will need to open a savings account and deposit some money in there, say $500. You will then walk over to the loan department and apply for a $500 loan. The approval is easy because the lender/bank will freeze your $500 and issue you a check for $500. When this is all said and done, you will walk out of the bank with a check for $500 or you can cash the bank’s check and get cash ( I recommend you do this). Now you can repeat the same process at several other banks or CU. The larger the amount the better it will look, but the downside is the monthly payment will be larger, so you’ll have to plan for that. The interest paid on these accounts is nominal and consider it a fee to these banks/CU for building your credit profile.
Step 2- This is almost like step 1, but online with secured credit cards. These you can find online, just be careful of scams. You should conduct a Google search for any reviews of them to make sure that they’re not out to get your money.
Step 3- There is rental reporting agency that for a fee will report your rental payment history. Again, you need to do your research online. The fee is typically around $20-50 for reporting. They will need a form filled out and signed by your landlord for this to work.
Step 4- Maybe there is someone that can place you on a joint credit card account. Do you know someone that can place you on their credit card? If this person is concern, you can offer to give them a deposit equal to the amount of the credit line, start off small like $500. Start using this card and making payments, soon you will have many other credit cards offers filling your mail box.
These methods are very effective and we highly recommend that you take action today to establish your credit. This will results in thousand of dollars of savings for you down the road.
No Comments »
No comments yet.
RSS feed for comments on this post. TrackBack URL