Ways to build a credit history from no credit history situation
Advertising Disclosure
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from many credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.
Credit Card Applications » Research » Guides » Building Credit History » Ways to build a credit history from no credit history situation

Ways to build a credit history from no credit history situation

Add to Favorites:
There are two situations when an individual has to take steps to improve his credit. When the individual has either earned a bad credit history or when the individual has still not made any monetary transactions and therefore has no credit history. Credit card reports are ascertained to people who take loans. It is a document that helps lenders to judge an individual's loan taking and repaying capacity. Steps that will help in establishing a no credit history individual's credit history are: 1. Understand how credit scoring is done. The two most important factors that decide the credit score of a person are: a. The loan amount taken by a person. b. If the person repays his loan amounts in time. c. The amount of the loan that is used by him. On the basis of the above three main factors, the credit score of a debtor is ascertained. In case the individual is not a student and still earning financial independence and still to acquire a credit score, then such individuals are referred to as people with no credit history. 2. Establish a savings and checking account. After an individual with no credit history has understood the ways in which the credit scores work, the next step is to establish a running checking or savings account in his name. It is natural that all lenders look at bank accounts as symbols of financial stability. In case of first timers, opening accounts in a well established bank helps in starting to establish a financial history. Minors below the age of eighteen will have problem opening a savings account individually as well as getting a credit card. They can start establishing their credit history by holding a joint account with any one of their elders. 3. No credit history individuals can also borrow a friend's good credit card score. This can be done by either being a joint credit card holder or by getting a co-signer for any loan. A co-signer actually helps in qualifying for loans in case the individual does not have a credit history. While the loan shows up on the credit report of the first timer and, when paid off with responsibility, boosts the credit score of the individual. On the other hand if the loaner defaults in repayment then the cosigner too becomes a defaulter. Individuals who have signed on to a person's credit card and have become a joint holder of credit cards will also need to be aware of the fact that a bad credit history of the joint card holder will also affect his credit scoring. 4. Individuals still in college have a better chance to establish their credit history. The reason behind this is that loan establishments will get financially established. This situation might not arise when the individual gets a job as then the repayment of the loan becomes his sole responsibility.

Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Related Research:

How to Get Free Wi-Fi in the Air

By Herbert Moore, Posted: September 28, 2016

Sometimes in-flight Wi-Fi is the bare necessity when you travel abroad or within the country. However not all airlines offer free in-flight Wi-Fi. There is only a couple of airlines that will allow you to use Wi-Fi ... Continue reading

Amazon Credit Cards Review

By Allison Martin, Posted: May 30, 2016

When Amazon.com was launched 20 years ago, few could have envisioned how far the company would come. What was once an online specialty bookstore is now an Internet juggernaut that sells nearly anything and has made major inroads into ... Continue reading

How Much Do Shell Cards Really Save on Gas?

By Allison Martin, Posted: April 20, 2016

There is an endless amount of gas cards on the market, and practically every major gas station, including Shell, has options to choose from. In fact, Shell offers two options for gas cards for consumers. Continue reading