How to build up my credit

how to build up my credit

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In order to obtain a good credit rating you need to have a handful of open accounts that you use regularly and are regularly reporting to the credit bureaus. From a mortgage approval perspective, we like to see at least 3-4 tradelines that have been opened at least 1-2 years.

If you use them wisely, make ALL your payments on time, and never max out any of your credit cards more than 30% of the credit limit, this should result in a favorable credit score.

If you have some credit already, but it's not in good shape, the

best thing to do is get it in good shape. Catch up on any late payments, pay down your balances, and get the derogatory credit stuff in the rear view mirror ASAP.

If you have no credit yet, start with your bank or credit union and see if you can open a credit card or if you can get a small personal loan. If they won't give you either, then see if they will give you a secured credit card backed by your savings. Then you probably need to open up a couple more accounts as well. Other credit cards, stores you frequent, gas stations, etc all have credit card programs.

In addition, you may want to sign up for a credit monitoring service to check on your progress. It's a marathon, not a sprint, and the goal is to get your credit profile into as good of shape as possible so you can qualify for the best mortgage rates when you go to buy the house.

Source: www.zillow.com

Category: Credit

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