"I'll Give You Credit For That" - Credit Improvement Tips
Many people have asked me, "What can I do to fix my credit?" or "What can I do to build a credit history?" Well, this post has a few of my thoughts on how to establish and improve your credit score.
-Acquiring a secured credit card in your name, can be great for building credit because almost any applicant can qualify for them, as they are backed by mandatory cash deposits. Just be sure that the company reports the card to the credit bureaus so your positive payment history can help build your credit file.
-Student credit cards can be great options for younger people who are just starting to build their credit history. These cards typically offer higher acceptance rates and may even come with promotional offers and rewards. One potential drawback is these cards usually have lower credit limits and higher interest rates.
-Retail credit cards can also be used to build credit. While they're usually easy to get and can help consumers save money at retail stores, these cards often have low credit limits and interest rates that are higher than non-retail cards.
-Asking to become an authorized user on a close family member or friend's credit card is also an option to consider. Since the card's history is usually reported to the credit bureaus, if you and the card owner use it responsibly, it should help the both of you. However, keep in mind that the opposite situation is also true-- if either of you miss a payment or rack up a lot of debt on the card, it could hurt both of your credit histories.
Increasing Your Credit Score & Maintaining Good Credit
- Before you can begin to repair your credit, you need to know what your credit history looks like. You should request a free copy of your credit report and check it for errors (see my “Credit Reporting Basics” post).
-Late payments and collections can have a major negative impact on your credit Scores. If you have missed payments, get current and stay current. The longer you pay your bills on time after being late, the more your credit score should increase. The impact of past credit problems fades as time passes and as recent good payment patterns show up on your credit report.