Tips to establish good credit

Tips on establishing credit, Establishing Credit

Before you apply for credit, make sure the creditor or lender reports credit history information to one of the credit bureaus so you can build your credit history.

If you know you have some items on your credit report that are negative and you have been denied credit because of them, submit a Statement of Circumstances along with your application.

Get credit in your own name

Whether single, married, separated, or divorced, you are entitled to a credit file in your own name. If your spouse or former spouse had or has bad credit and most credit was in the spouse's name, it would definitely be advantageous to have your own credit file.

When you apply for credit, read the agreements carefully and be sure to notice the interest rate and monthly fees proposed.

Find out if there is a fee for cash advances, how the interest is calculated and how often credit limit are reviewed.

Apply for credit in local stores

If you are having difficulty being approved for new credit, try applying for credit with a local merchant, such as a department store. They are much easier to qualify for and can help you begin to build a good history

Take out small loans

Take out a small loan from a local bank or credit union, even if you have no immediate need for the money. Make payments on time and consider the interest expense an investment in establishing a good credit history.

Secure lines of credit

Take advantage of secured lines of credit offered by some lenders. By depositing a specific amount into a special account, you receive a credit card with a limit that equals your deposit. (For example, if you deposit $ 500, your credit limit will be $ 500.)

If you are having difficulties finding a bank that will give you credit, contact the Bankcard Holders of America at 540-389-5445. This is an organization that can provide with a list of banks that offer both secured and unsecured credit cards.

If you can not qualify for a credit card on your own, you may wish to ask a family member or friend to co-sign for you on a credit card or loan. The other person promises to pay the lender if you cannot and gives the lender the extra protection.

Do not apply for credit too often

Every time you apply, an inquiry is made on your credit report and the inquiry is recorded on your report. Reports that have too many inquiries are not regarded favorably. Future creditors will feel you have been turned down frequently, or that you are seeking too much credit.

Just a reminder!

A consumer may not be denied credit because of age, race, religion or national origin. He or she must be notified in writing if rejected, with reason(s) for the rejected.

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