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Research: Creating a credit history from scratch -

Credit cards are just small pieces of plastic but with the power to rule the world. In this day and age it almost seems fashionable to own a card. The first thing a teenager thinks about after obtaining financial freedom is a credit card. It is a simple way of gaining money on credit. This credit is payable periodically. The failure to pay these charges is tagged with finance charges. It almost seems too good to be true, all the money in the world at your disposal.

It is a record of all the past credits and repayments that an individual has made. It is also known as a credit report. It is an indicator of weather an individual pays his credits on time or has a tendency to hoard his credits. The credit history is one of the major criteria's that credit card agencies look for to gauge a person's credit worthiness. For obtaining a credit card the customer has to first fill out an application form. This form is forwarded to the credit bureau for the evaluation of his credit history. If one has a bad credit history it is often difficult to get your credit card sanctioned. Certain card agencies look for individuals with a bad credit history, in order to gain profit through means of high interest that they are sure that their client will incur consequent to his habits.

Credit history is essential for an individual. Certain formalities require that an individual has a credit history for the sake of cross reference. For example if you need to rent an apartment they require to evaluate your credit history

Steps to create a credit history

It you don't have a credit it is very difficult to get a credit or a loan .For this you have to understand what the credit card agencies are looking for.

Since you want credit for the first time companies cannot see your past credit. Some of the other parameters that they might look into are bank accounts, employment history, residence history, Utilities in your name

First, start by opening a checking or a savings account. Opening these at a bank would be the initiation of establishing a credible credit history. One must have reached a legal age of 18 for gaining a credit card; hence the savings and checking account can be opened for starters. By managing a bank account well you can show the investors that you are responsible with your funds. Considering this the card agencies can gauge whether you are an investment liability. Maintain a good rapport with the bank. This could enhance your chances of gaining a credit or a loan from them.

Try to start a department store card. Under normal circumstances these cards should be declined, as they usually have rising rates of interest, but in cases where you are trying to establish a credit history it might be a good option. Use this card in a diligent manner making all payments on time. If all else has failed then a secured credit might be your only option.