If you are young, your credit score might not seem like a priority. However, at some point in your life, it is very likely that you will need a positive credit score. That is why it is better to prepare in advance and begin building your credit right away. If you do not have a positive credit, chances are that it will be very difficult for you to find a lender for a loan, which can prove to be a real problem. Therefore, it is recommended to learn how to build credit and in this article, we have some advice that might help you in the future.
Build Credit For The First Time
Young people might not have a bad credit. In fact, they might not have a credit at all, which can prove to be challenging as well. A secured card is usually the first step in such situations. If you manage to use it for six to twelve months in a responsible way you can go ahead and get a traditional card.
There is also a loophole that can work to your advantage. Get someone with good credit to co-sign for you. A co-signer will declare himself as fully responsible for your debt if you do not manage to pay it, and it also works as a qualification. However, in this situation, you have to be very careful and make all your payments on time, unless you want to harm the credit of the other person as well. Being a co-signer is a big risk so it may be very difficult to find one.
You can try another ”trick” as well. If you find a family member of a friend that has a credit card and is willing to make you an authorized user, the payment history and utilization of that account should be reported to your credit file.
Your credit report will show you everything that you need to know. It also comes with personal data, including your name, addresses, work history and Social Security number. In your report, you should also find all your credit cards and loans. This means that you will also be shown how much money you borrowed, the date your accounts were opened, monthly payments, credit limit, average monthly balance and more.
Public records will appear highlighted in the report. For example, any kind of legal problems like foreclosures and bankruptcies. Inquiries will also be there, even if they won’t be available for the creditors. You can receive a free annual copy of your credit report. You can check your credit report more often if you use Credit Sesame, which offers you free credit score every month and free credit report. Additionally, you can choose to purchase a service that will show your credit report.
However, you should know that your credit score won’t show up in the report and you will have to pay a fee to get it. You can receive it for free on Credit Sesame.