Your credit is a significant factor when planning and meeting your financial objectives. Whether you’re looking to getting a better credit card or purchasing your first home, you would require proper credit at the very least. However, what if you don’t have credit to start with? You need to earn it slowly but surely by building your credit profile. To get you started, read the following tips:
Obtain an Unsecured Credit Card
A secured credit card requires a collateral or security deposit worth hundreds of dollars. Your deposit would serve as the lender’s safeguard should you fail to make your monthly payments and sets how much credit you could use. Secured credit cards likewise offer some sense of discipline in your spending. In Richland County, you can apply for an unsecured credit card and get your deposit back once you build disciplined spending habits.
Find a Cosigner
If you have someone (like a parent, sibling, or trusted friend) with great credit as a cosigner, you can have access to products that you won’t typically have access to on your own because of lack of credit. For example, you could get a cosigner for a credit card or loan.
Be an Authorized Credit Card User
Ask a family member or trusted friend if you can become an authorized user on his or her credit card. When you become an authorized user, you will be able to utilize the credit card and pay back what you charged on it.
Consider Credit Builder Loans
Credit builder loans are loans that help people like you build credit. A credit union or bank would set aside some money into an account that you could borrow from. You then pay off your loan through monthly payments, and once you have repaid the full amount, you could then access the entire loan amount, including interest.
Yes, building credit from scratch can seem like a challenging task. Still, it’s possible, especially when you see all your time and efforts bear fruit in the long term. You’d be more likely to obtain more rewards, better interest rates, as well as more savings.