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In This Chapter:
How To Establish Credit
Tips on how to establish credit, online credit card finders, credit card search, unsecured credit cards, avoiding scams.
We'll review sites like iCreditSearch which have unsecured credit cards
for people with bad credit or no credit. The key to establishing credit or to re establish credit is not to let potential creditors take advantage of you because you
have not established credit yet. The best way to establish credit is with low cost purchases. This will ensure that you have the ability to pay off the bill.
If you have no credit history or have a bad credit history, anyone that gives you credit may charge you 21 The offers for 5% interest credit cards you get in the
mail may not come to fruition for you once you fill out the application and mail it in. You aren't in a position to be choosy. We don't recommend using a department
store card as a starting point to establish credit because they charge 19-22% interest. Always verify the interest rate of any card you sign up to first. Gas
cards are just as bad, but as long as you only use them to buy gas and pay them in full (typically $60 per month) when the bill comes, you won't pay any interest.
This will help you establish credit from the ground up, while at the same time getting you in the habit of paying all your credit cards in full when they arrive.
Part of maintaining good credit is knowing what your credit score is, so make sure you get your credit score.
Sites to get your online credit report
The top sites to get your credit report from are Equifax or
TrueCredit. All these sites allow you to get your online credit
report instantly. Be sure you choose the option that gives your credit score too. These sites are reviewed further down the page.
Now is the time to get your credit credit report
Don't put it off until later, you'll be sorry. Do it now before you even finish reading this page, so you can find out what your score is, and begin your first steps
to improve it. It takes 30 to 60 days to get issues with your credit history resolved. For more information on credit scores, and credit reports, read the
chapter: How To Get Your Credit Report, understand and improve your credit score.
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Before you do anything to establish your credit be sure to open a checking account. You will need a checking account to pay your bills
and it is a good way to show that you are financially responsible by not overdrawing your account.
Family:
Your own family may be able to help you establish credit. Use family money as a down payment on a loan and finance the rest yourself.
Since you will be paying a large down payment it will increase your chances of getting a first loan.
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iCreditSearch is a credit search that finds a credit card for people with
bad credit. Instead of applying to different credit cards, getting turned down, and having your credit ruined even more, try
iCreditSearch. Just answer a few simple common questions, and they list all
the credit card banks who are guaranteed to issue unsecured credit cards to people with bad credit. It's a great way to get a credit card for people with bad credit.
It's like pre-qualifying, for a credit card WITHOUT the credit check. |
SCAM ALERT:
If you have not established credit and are buying a car make sure to read this. Many dealerships have first time buyer programs or graduating college senior
programs subsidized by the car manufacturer. Some dealers may claim they have a first time buyer program, when there really is not one and they are just charging you
18% APR. If you have a good credit card history, there is no reason to pay 18%. They are feeding off your lack of knowledge and fear of rejection. As a first time
buyer you have all the negotiating rights that I do, and don't let any salesman tell you otherwise. Just keep shopping for a dealer who is willing to work with you.
You may not get the car you wanted, but at least you won't be paying double the interest. Also, first time buyers get caught up in the euphoria of buying a new car,
and because they are naive, are easily persuaded by salespeople to buy all the extras, or even pay full MSRP. Welcome to life in the real world. Read more about
buying cars at the useful consumer advocate site CarBuyingTips.com
College Students:
If you are making a high priced purchase such as a car and need to establish credit don't let you self be ripped off by a salesman who offers to give you a
"great opportunity" to establish credit by charging a ridiculous APR. If you are a student working at the university, you may be able to get a loan through the
credit union. Try there first, it could be the best place for you to establish credit. Some college students, when buying a car, have their parents just buy it
for cash. This is good, but does not establish credit for you. You might be better off having them put down a sizable chunk of cash, then you carry the remaining
small loan balance. When you finish paying off the small loan balance, you have established yourself as a creditworthy person, and should find it easy to get credit
later on, and more importantly, at a lower interest rate than 18%. Having a credit card under your parents' name does not establish credit for you.
Try the Discover® Student Card to establish your own credit.
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