If an adult has no credit history, what's the best way to establish one?

Question

My neighbor is 47 and has only paid cash for everything. She would like to have some kind of credit history.

Answer 1

Here are some tips that should help out. Get a checking and savings account, then ask if the bank you have your deposit accounts offer secured cards. how those work are that you set a savings account with a certain amount of money and then the same amount is extended in a line of credit, the deposit in the savings account is to guarantee that the credit card will be paid in the event you're not able to pay. I would suggest not charging too much on the card and pay it off every month if possible. Normally after about a year of that, the account will convert to unsecured and you'll be able to get your deposit back, plus interest. Another thing is this. (click this link) http://prbc.com/consumers
Anything that you pay everymonth can be reported as good credit. it's similar to a traditional credit report but it shows how well that you pay. It's a lot on information on the website for me to mention, but it's worth it, trust me

Answer 2

Too many trolls here.

If your neighbor needs to establish credit, the fastest way is to have someone add her as an authorized user to their own credit account. That account must be in a good standing, with no previous negatives like late payments. The neighbor doesn't even need to see the credit card. There should be trust between the neighbor and the person authorizing her, preferably a close relative, since doing this wrong can screw up each other's credit.

Dave Ramsey advice is for people who can't control their spending.

Answer 3

Try a secured credit card. You put money into an account to set your limit. Then use the card to purchase a couple items. After a few months apply for a regular credit card and use it wisely. Never buy anything you can't afford to pay off in 30-days.

Answer 4

go to a bank and get a secured credit card, That means, you put $500 in a bank account, then the credit card limit is set to $500.00, You can use your card as normal, and start building up credit, pay it off as normal. Banks do this because there is no risk to them, you bank account secures the credit line, so if you dont pay they have the bank account to take the money out of. Its how I started building my credit, when I was 16. Hope this helps.

Answer 5

Why? She doesn't need one. If you pay cash for everything, you don't need credit. You only need credit if you want to be in debt.

Both of you should read: The Total Money Makeover by Ramsey. He has a credit score of zero and pays cash for everything. If she is looking to buy a house all she needs to ask the bank to do is do a manual underwriting loan (Churchill mortgage does them; local banks or credit unions should also).

Dave Ramsey's advice is for those that want to have money(CASH) and not work to pay payments.

Answer 6

Dave Ramsey's principles, that's the way to go!

Absolutely do not pay any kind of fee to open a credit/debit card or take out an unneeded loan.

An "emergency only" credit card isn't a bad idea.
The emergency being "I don't have cash in my pocket" not "I don't have any money right now."

No credit beats bad credit any day.

Answer 7

Why is it necessary that he/she have a credit history. Financial advisor, Dave Ramsey would say that it's great that he/she has paid cash for everything. If he/she continues to pay cash for everything, a credit history is not necessary.

Answer 8

Get a credit card. Spend a small amount each month. Pay it off each month. Be very careful with credit. If you let it ride and are not disciplined. You can ruin your credit before you get any.

Answer 9

Could start out with a Credit card. Buy furniture or a car. Possibly a signature loan from your local bank.

Answer 10

Apply for an orchard bank credit card. She's pretty much guaranteed to get that, and it's the most honest no-credit card. I also suggest getting a co-signer to open a card, but honestly, please DONT be her co-signer!!!