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Building Credit Starting From Scratch

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When you are trying to buy a home but have not really established a credit history there are some things that you can do to start building a good credit history. You can try to apply for a department store credit card such as Sears or JC Penneys and if that doesn’t work you can apply for a secured credit card with a bank or a credit union. A secured credit card is one that the bank or credit union issues you that requires you to give them a deposit. For example say you wanted a secured credit card with a credit limit of $500.00. You would give the bank $500.00 that they would hold onto and they would issue you a secured credit card with a credit limit of $500.00. Once you have the card you can use it just like any other credit card and it will be reported on your credit report just the same as any other credit card. As long as you don’t carry a high balance on the card and you make your payments on time you will start building a good credit history. Once you have the card for a while you will probably start receiving credit card offers in the mail and you can then apply for a couple of them and they should be unsecured.

When you are deciding to get a secured credit card you should call around and see what rates the banks offer, What increments they issue them in($300.00/$500.00/$1000.00), what monthly fees there are(sometimes around $10.00 a month), and if your secured credit card will change into an unsecured credit card after a certain period of time. For example if you have a secured credit card and are paying $10.00 per month and have been making your payments on time, after about 6 months to a year some banks will give you your $500.00 back making it an unsecured credit card and some will stop making you pay the $10.00 per month fee. Establishing a good credit history will help you when it comes time to apply for a home loan so get started by calling around to some banks and getting all of the details from them and then decide which card is the best for you.

Alain Picard
Cell: 253-861-7386


1 Comment

  1. Collections says:

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