Pierre Money Mart Blog

You’ve got no credit, although you know you need to get it. But it’s easy to feel like you’re stuck when you realize that you are unable to get credit because you’ve never had credit, and you’ve never had credit because you can never get credit.

With a problem like that, you may prefer to consider whether a tree that falls in the forest makes a sound if nobody is around to hear it.

Thankfully, it isn’t impossible to go from no credit to good credit if you know what to do. By using the following strategies, you can begin to build a credit history you can be proud of.

You can begin establishing credit with a small loan or line of credit from your bank, or a credit card designed for people with bad credit.

When applying for a loan, it should help if you are able to put together a large down payment. To get approved for a credit card, you will need to at least 18 years old with a steady source of income.

In either case, make sure the bank or card issuer reports to a credit bureau. It will not help you establish credit if they do not.

Also, consider applying for a secured credit card, which requires a down payment. After a few months of using your secured card responsibly, it may be possible to qualify for an unsecured credit card.

Once you are ready, avoid applying for many credit cards at the same time. Also avoid applying for cards you are likely to get rejected for. Both too many applications and being turned down can make you look bad to lenders.

If you are unable to get a small loan or a credit card in your own name, see if a close friend or family member will co-sign for you. Be sure to let this person know that you plan to be responsible about making payments on the loan or credit card.

For those consumers who don’t have a checking account, opening one will give you credibility in the eyes of lenders. If possible, set up a savings account, also. Keep tabs on how much money you have in order to avoid overdrawing funds from your bank account.

Meanwhile, be aware that lenders and credit card issuers look at more than just your payment history when issuing credit. Other factors include how frequently you move and how often you change jobs. It can also help to have an apartment, utility, and telephone number in your own name.

Regardless of the strategy you choose, be sure to always make payment to lenders on time. With credit cards, try to make more than the minimum monthly payment. Such responsible borrowing will get you on the road to good credit in no time.

Need to tune-up your credit? Check out our do-it yourself Credit Repair Manual here!

Well, the credit repair strategizing starts on your study table with a pen and paper. If you are more techno-savvy, you can even use a spreadsheet program or a word processor. You first need to chalk out a plan for all your expenses. Jot down all of them, necessary and unnecessary. Think of, for instance, tuition, fees, child care, emergencies, entertainment and recreation (going to the movies, tapes/CDs, sports/fitness), health care (medical/ dental/ vision/ prescriptions), housing (rent), utilities and phone, furnishings, food (snacks, beverages, restaurants), clothing, laundry, books and supplies, commuting (trips home, car payments, gas/maintenance, parking fees), insurance (car, renters), credit cards and loans, personal expenses, etc.

Take a good look at the list and do some evaluation. A little elimination and selection is called for here. You need to decide on the things that are really important and other expenses that you can avoid. Only when you show such judiciousness and thrift will your credit repair strategy be successful. All the items on the list that fall in the later category of suspects could be highlighted. You need to some brainstorming over what you absolutely need and what you can do without or cut down on. For example, those countless movies and eating outs could definitely be checked. A dinner at your favorite restaurant and a movie once every weekend is just fine.

Also try not to buy anything that you cannot pay off, interest included, within a month. This sort of credit repair approach would help you establish a positive credit referral on your credit report. The credit reports are evaluated on a month-by-month basis and your credit report repair strategy has to adapt to this mode of evaluation. By diligently following this strategy your credit report would also begin to reflect your improved credit situation.

Besides boosting your credit situation, this credit repair strategy would also ensure that you have sufficient money for urgent things whenever you need it. You guilt trip would also be cut short with all the frivolous expenses cut out.

The next step of this credit repair strategy is to concentrate on all your credit card bills: current and outstanding. Put by some reserve every month towards your credit card bills. Besides paying all your current bills, you should contribute some extra amount towards settling any outstanding debts. By catching up on all your payments, you would not only improve your credit rating, you would also manage a concentrated budget that prevents any frittering away of precious cash on frivolous things. Now you have got the money to purchase those books or lab supplies that you have been planning on for a long time.

You also need to figure out the factors that are causing you to be in debt. The debt causing items on the list have to be paid special attention. Not paying your credit card bills or paying them late, pending rents and tuition fees etc. can play havoc with your credit. Or it is possible that your credit is already damaged owing to these reasons. You then need to set the damage control process in motion. A carefully planned credit repair strategy can help you do that. It would enable you a better insight into your monthly expenses and their management. A comprehensive list of your expenses would allow you to identify the problem areas.
Need to tune-up your credit? Check out our do-it yourself Credit Repair Manual here!