Credit builder apps to improve your credit score

Credit builder loans

This type of app enables you to take out a small loan and pay it back to help you build credit. They are typically between $500 and $1,000, but some lenders let you take out a little more. The term of these loans usually ranges from 6 to 24 months. And as you make payments, the lender reports your on-time payments to the major credit bureaus, helping to increase your credit score. At the end of the payment period, you get your money back, minus any fees and interest. Self and Brigit, for example, offer credit building loans to their subscribers.

Credit builder lines of credit

Credit building lines of credit work by setting up a credit line to get access to educational resources such as e-books and e-courses on financial literacy, or to buy items from the company's online store for a reasonable membership fee. You repay the loan in small instalments, and the lender reports your payments to the credit reporting agencies. However, unlike a credit builder loan, you won't get your money back or a payout at the end. Kikoff and Kovo, as an example, provide affordable lines of credit that can help improve your credit score.

Credit-building apps that report your monthly subscriptions

Some credit builder apps let you build credit by paying everyday expenses, like subscriptions and utilities. This option works by automatically paying and adding to your credit report additional bills such as cell phone, streaming services, and utilities. You probably use subscriptions like Netflix, Hulu, or Spotify, so subscription service payments can help improve your credit by increasing the number of on-time payments included in your report. For example, you can use Grow Credit to pay for any of your subscriptions.

Credit building secured credit card

Building credit can be tough, especially when you don't have any credit to begin with. This is where secured credit cards can really help you build credit and good credit habits. You can use your card to make purchases and payments as usual, but the main difference is that secured cards will require you to provide a cash security deposit, usually equal to your credit line. At the end of each month, it will report your account activity to the credit bureaus. And this way, you can gradually build up your credit history. For instance, the Chime Secured Credit Builder Visa^® Credit Card makes it easy to stick to a budget and pay your credit card bills on time.

Credit monitoring apps

Your credit score shows lenders how trustworthy you are as a borrower. So having a good credit score is the only way to get the best terms on your loans and pay less over the life of your loans. All credit bureaus offer apps of this kind. They won't improve your score directly, but they can help you keep track of your current credit score and provide you with useful credit building recommendations. They may also alert you to newly opened accounts, hard credit inquiries and public records like bankruptcies or lawsuits. Apps to help you keep a close eye on your credit score include Experian Boost™, Credit Sesame, MyFICO and others.