How To Establish Good Credit
Obtaining and maintaining a good credit history is very
important for any consumer's present and future financial
condition. But how does someone go about doing this?
To some people's surprise, establishing credit is relatively
simple. If you are earning a stable income and have lived in the
same residence for at least the past year, there are many ways
to establish credit. One way is to apply for a credit card with
a local gas station or department store, both of whom have lower
credit standards than other larger businesses and lenders. This
allows you to obtain a credit card that will limit your spending
to only gas or the items that you can find in that particular
department store. Usually, the balances you accumulate on these
kinds of cards will not exceed what you can bear.
Another way to build credit is to take out a small loan from
your local bank or credit union. Even though you may not have
any real need to take out a loan, and though you might not want
to pay the interest expenses, it will be a relatively simple way
for you to build credit, so long as you make your payments on
time.
It should be noted that before you apply for credit through any
company, be sure that the creditor or lender actually reports
credit history information to a credit bureau so that all of
your dealings with the institution will aid your credit history.
Once you have found a way to begin building your credit, make
sure that you pay your bills on time. Recurring late payments
and unpaid bills are frowned upon by all creditors, and will
negatively affect your credit score.
However, if you do encounter a situation that makes it
impossible to avoid late payments, contact your creditor
immediately. Most creditors are willing to negotiate an
adjustment to your payment schedule to accommodate whatever
difficulties you are experiencing.
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