How can one Build Good Credit?

Answer 1

If you have control over spendings, you can start by getting a credit card, with a $500 limit. Buy things that you can pay for, don't have any late payments. Always try to pay the balance in full. It builds credit over time, and you get points and rewards!

Answer 2

The first thing to remember is start slowly. Sometimes people apply for a bunch of CCs and get in way over thier head. You might apply for two credit cards - one with a major company behind it (like Visa, MasterCard, Citi, Discover, etc) and one from a department store that you frequent (like JCPenney, Khol's, etc. You could even open a Wal-Mart or Target charge card if you shop there a lot).
When you get the card, understand the terms of the agreement - grace period, APR, finance charges, annual fees and the like.
Know your credit limit.
Use the cards once per month for purchaes that you would normally use cash to buy. Pay the balance off in full each month. You will build good credit by paying on time and using your cards responsibly. Eventually, the cards will want to raise your credit limit and you will cruise from then on.
Good luck!

Answer 3

The secret to good credit is to build LONG standing relationships with credit card companies and NEVER be late on a bill. Not even one. And dont let your credit card balances go over 50% of their credit limit. If you stick to these rules you will build a good credit score over time.

Answer 4

If you have no credit, find a co-signer for a loan or credit card. If you have credit, but you have negative credit history, you should obtain a copy of your credit report from the 3 major credit bureaus to check for accuracy. You can dispute anything on your report that shouldn't be there.
There are credit cards and companies which grant credit to those with little or negative credit history, but you should be careful in understanding thier terms, as high risk credit can be costly

Answer 5

You can easily build good credit in different ways..

You can check out these articles that might be helpful to your needs.

http://www.squidoo.com/rebuildbadcredit/
http://hubpages.com/hub/secured_credt_cards_online
http://www.squidoo.com/building-business-credit/
http://www.spendinghabits.blogspot.com

Answer 6

First, it would help to know what makes up your score. Here's a breakdown.

Payment history 35%
Amount of debt that's owed 30%
Length of time that credit's been established 15%
Types of credit 10%
Inquiries and New accounts 10%

Now, the biggest killer of a credit score is paying late and having a lot of debt. What you may need to do is to get a copy of your credit report and http://www.annualcreditreport.... to see what and how much you owe.

Once you get your reports look and see how much you owe. The easiest way would be to find the smallest amounts and the ones that are the most recent first. Contact the collectors and negotiate a "payoff for deletion". That's a payoff amount that will clear the debt off your credit report. If you're able to get them to agree to this, it is necessary to get something in writing on their company letterhead before you send them a dime.

After you've cleared all of your delinquent debt, then review your report to make sure that there isn't any inaccurate information. If it is, then you should immediately dispute that with the bureaus.

If you haven't already, you should open a checking and savings account. While this doesn't have a direct effect on yout credit, it does show lenders that you're stable with your finances

If you have a close friend or family member with excellent credit, ask them if they can add you as an authorized user on their credit cards. You do NOT need a card as this would only be for reporting purposes only. Their payment history would be included on your credit report if you're able to be added.

Another thing would be to open ONE credit card. The easiest one to get would be a secured credit card. You would have to put a deposit upfront to secure the same amount in a line of credit, but at least this way you wouldn't be declined and depending on how much you put in the security deposit, YOU control the credit line, instead of the credit card company telling you how much THEY think you should have. The key is simple: make small purchases that can be paid off in full, on time every month. And you may want to increase your credit line by adding to the security deposit every 2 months or so. That way after a year of perfect payment history, you'll get the deposit back with possible interest, and the card will convert into an unsecured one, not to mention with a credit line that you will be happy with.

I have another option that also helps but it takes time. If you're able to get a secured credit card and get up to at least a $1000 credit line, then you're in good shape to do the next option which is open up a certificate of deposit and then take out a collateral loan against it for the same amount. I'll give you an example: Let's say that I opened up a secured card got the deposit up to $2500 before it went unsecured. Well, I'm going to get that deposit back becuase I don't need in anymore. From there, I would open up a certificate of deposit where I do my banking and then take out a signature loan using the certificate of deposit as collateral, kind of the same way that I did with the credit card. Now I would take the proceeds from the loan and put THAT into a savings account to get interest off of that. Then I would pay the monthly payment every month for at least 9 months for it to show on my credit then I would pay it off. Not only have I boosted my score by showing positive payment history on a loan, but I'm still saving money in the process with the Certificate of deposit!

Finally, another thing you can do is to report montly payments like rent, utlilites, insurance, wireless phone, and other bills that don't show up on your credit reports to a reporting agency called PRBC. It helps people build credit by reporting payments to monthly bills that don't show up on credit reports, to give a more accurate picture of your payment history. Current and previous history up to 3 years back can be reported and scored in a report that can be used with your traditional credit reports.

Hopefully, with these steps you can be well on your way to getting your credit back on the right track!

Answer 7

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