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Whatever your needs, whatever your monetary status, there may be appoint where you need to apply for a loan or some extra financing. That's when there is the requirement for a credit history. For banks to trust someone with no prior credit history is very difficult. They might wonder if you are a stable individual who can repay the money lent to you. Particularly if the amount you are looking to get is large, chances of getting it with no prior credit history is next to zero.
Banks need actual facts, real records which can validate you to them. They need credibility statements which will make them trust you with granting a loan for your needs. When you decide to approach a bank for a loan, start with a bank where you have an existing relationship. If you have a bank with which you have a savings or checking account you can show them that you can manage your finances efficiently.
You may also have come across instances where when at a department store you were offered a discount card. It allows for the customers to have a store endorsed credit card allowing for savings on the purchases. Although the store discount and coupons appear attractive, they may have a high interest rate which can be difficult to pay back at the end of it.
In case you did not luck out with your local bank, you could opt for one of these cards, since they are quite easy to come by. Once you have the store credit running well and the money being managed efficiently you will be able to show authentic records to your bank. Be careful once you have the card with you, that you do not end up over spending. It is not free money. Keep in mind it is an opportunity for you to maintain good credit records to be allowed a loan or a mortgage option.
If none of these work then the final option is to go for a secured loan. The secured loan allows for the loans to be sanctioned based on collateral. With a secured credit card the bank can take the deposit away if the payments are missed. There are also government grants available, if loans are not. These are free money with no collateral necessary and no credit checks done as well. There are government grants available for a number of different needs.
There is also another method to establish credit history and this is by associating with a bank where you have your salary account. Since they will have prior financial records and will be able to easily validate and see that you have a consistent salary and will be able to afford the payments on the loan, it will be easier to get it sanctioned.
Having records of rent payments made on schedule can also help with ascertaining that an individual has got a good history of managing their finances and will be looked on more favourably.
