To make large purchases like a house or a car, you need to have an established line of credit. Establishing credit is not an immediate process and can take a long time. However, there are a few tricks for building credit quickly and making sure that your loans and credit requests are approved.
- Don’t let bad credit marks go on your credit history. The reason bad credit is so dangerous to credit scores is because it stays on your history for a very long time; sometimes up to ten years.
- Keep credit balances low. A low balance and no interest rates are ideal for saving money and building your credit score. If you have a credit card and use it sparingly, you are at no risk of incurring credit debt, while still establishing positive credit.
- Always pay bills on time. This is perhaps the best way to establish a good line of credit. Lenders prefer lending money to individuals who have proven they are responsible and can properly manage their finances.
- Use your credit. If you never use credit, you can’t build credit. By using your credit card every month, even sparingly, you will establish credit more quickly.
- Avoid going into debt. Debt will send your credit score spiraling downwards, and will significantly hurt your chances of establishing a good line of credit. Never borrow more than you can afford, and always pay back what you owe. If you are unable to pay back your debts, consider contacting a Hamilton bankruptcy lawyer.