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Started By
Message
Best way to build credit?
Posted on 11/27/15 at 11:40 pm
Posted on 11/27/15 at 11:40 pm
My 20's ruined my credit and it's hobo low. What's the best way to build it quick. I know "quick" is a reach 
3
Posted on 11/28/15 at 2:48 am to pwejr88
You'll rebuild it fast as long as you don't frick up more.
Its on your record for seven years but it starts to fade dramatically in importance after it is two years off. Thats not to say you will have 750+ in three years, but it won't be in the range that will stop you from getting a mortgage at a reasonable rate or credit card with a decent limit.
The most important thing to do is to not close whatever LOCs you still have.
They are your most valued asset in rebuilding credit. If you don't already have credit, you can't build credit.
If you already closed everything, your only chance is to open a secured credit card, which would require a deposit of cash to serve as collateral against your limit.
Its on your record for seven years but it starts to fade dramatically in importance after it is two years off. Thats not to say you will have 750+ in three years, but it won't be in the range that will stop you from getting a mortgage at a reasonable rate or credit card with a decent limit.
The most important thing to do is to not close whatever LOCs you still have.
They are your most valued asset in rebuilding credit. If you don't already have credit, you can't build credit.
If you already closed everything, your only chance is to open a secured credit card, which would require a deposit of cash to serve as collateral against your limit.
Posted on 11/28/15 at 6:57 am to pwejr88
quote:
My 20's ruined my credit and it's hobo low. What's the best way to build it quick. I know "quick" is a reach
You're rebuilding your credit so long as you're paying back borrowed money on time. Phone bills, electric bill, hospital bills are not borrowed money and won't help you but sure as hell will hurt you if you're late. In banking we call it servicing debt. If you have student loans, car, credit cards, mortgage, loans, then pay them back in time, no excuses. If you do not have any borrowed money then go apply for a retail card (target, wal mart, gas stations) and put $100 on there and pay it off in increments of $20 a month and do it over again. Your credit score is nothing but a giant computer that resets every 30 days. So, if you were to spend $100 on that credit card and pay all $100 off immediately, the credit score computer never saw that you borrowed and paid back in a timely manner. Banker here.
Posted on 11/28/15 at 8:28 am to Rhino5
He doesn't need to carry interest on a credit card to rebuild his credit. He just needs to use the card monthly and pay the bill off monthly. The statement balance is always going to report to the credit bureaus anyway. Paying interest on a credit card is always a dumb thing to do. Just wait until the statement is issued and then pay the balance.
Posted on 11/28/15 at 8:47 am to VABuckeye
quote:
The statement balance is always going to report to the credit bureaus anyway.
Not true if the statement is zeroed prior to the new billing cycle. Also, if $100 is too rich, then spend $50 and have a roughly $5 interest charge.
Posted on 11/28/15 at 9:30 am to Rhino5
There's absolutely no reason to advocate paying interest, and it is poor advice regardless if it's "$5" or $200.
He should get a card, spend about 10% of the limit, and pay the statement in full every single time. If you don't have the discipline to do that then a credit card can be a slippery slope.
He should get a card, spend about 10% of the limit, and pay the statement in full every single time. If you don't have the discipline to do that then a credit card can be a slippery slope.
Posted on 11/28/15 at 9:31 am to Rhino5
You skipped over the part where I said to wait until the statement is issued, now didn't you?
Posted on 11/28/15 at 6:55 pm to Volvagia
Thanks guys. That really helps a lot.
I will follow the advice.
I will follow the advice.
Posted on 11/28/15 at 7:22 pm to pwejr88
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