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Every single form of media today has advertising on how to build or rebuild your credit. Absolutely free, no obligation, no set up charge, introductory offer. Taking your lack of credit or your bad credit and overnight you have the credit available to buy that new car or get the mortgage for that dream home.
Building new credit is not hard, but it is time consuming. Restoring a bad credit history to a good credit history takes even longer. So do not waste your time or hard earned dollars subscribing to any of these get great credit quick scams.
Non-existent or bad credit is not the end of the world. To establish credit is a simple but time consuming process. I suggest that if you have little to no credit you simply apply for a credit card. I suggest that you apply for one or two cards, not dozens. Simply pick up an application at your favorite retailer and fill it out. Mail it in and now wait for a response. It may be a few weeks but do not be in a hurry. Once a card is issued I suggest that you charge a tank of gasoline or dinner at your favorite pub. Then put the card away and wait for the bill to come in the mail. Pay the bill in it's entirety as soon as you receive it. Then repeat this every month for the next few months. By using the card, and not using it to its allowed maximum limit you are showing the credit card company that you can handle the credit given to you responsibility. If you get two different cards, use one per month and always pay it off completely when the bill is received. You have established credit, you are using it wisely and you need to apply for no additional credit cards, two are sufficient.
If you have a history of bad credit here are a few tips to get back on the good side of creditors. The first thing to do is stop using your cards. The second thing to do is determine which debt has the highest interest rate. Pay that one off first. If you can accelerate the payment you will save on interest paid out and if possible, cancel that credit card.
Keep in mind that most credit card companies will not report your first late payment, but if you are late again in the next 12 to 24 months they will report to the credit bureaus. This one late payment can drop you credit scores as much a 50 to 75 points, which is substantial. So pay your bills on time, even if you can only afford to pay the minimum amount required.
Another item you need to know is the fact that you can charge too much to you credit cards and this hurts your credit score. I am not talking about simply going over your approved credit limit but I am talking about going above 75 percent of your approved credit limit. If you have a $2,500 credit limit do not go over $1,875. I know this may sound odd but the credit scoring computers consider any balances over that 75 percent mark as a sign of your inability to handle your debt.
Know that your credit history and the responsibility of correcting and maintaining it is up to you. There are absolutely no overnight fast and cheap ways to establish or repair your credit. So if you ever want to borrow someone else's money to buy a car, home or just a tank of gas you need to show those who give credit that you are worthy of receiving it.
Bob Kieber can be reached at (970) 262-1199 or at rkieber@comcast.net. He is a local mortgage lender and principal of Resort Lending.
Building new credit is not hard, but it is time consuming. Restoring a bad credit history to a good credit history takes even longer. So do not waste your time or hard earned dollars subscribing to any of these get great credit quick scams.
Non-existent or bad credit is not the end of the world. To establish credit is a simple but time consuming process. I suggest that if you have little to no credit you simply apply for a credit card. I suggest that you apply for one or two cards, not dozens. Simply pick up an application at your favorite retailer and fill it out. Mail it in and now wait for a response. It may be a few weeks but do not be in a hurry. Once a card is issued I suggest that you charge a tank of gasoline or dinner at your favorite pub. Then put the card away and wait for the bill to come in the mail. Pay the bill in it's entirety as soon as you receive it. Then repeat this every month for the next few months. By using the card, and not using it to its allowed maximum limit you are showing the credit card company that you can handle the credit given to you responsibility. If you get two different cards, use one per month and always pay it off completely when the bill is received. You have established credit, you are using it wisely and you need to apply for no additional credit cards, two are sufficient.
If you have a history of bad credit here are a few tips to get back on the good side of creditors. The first thing to do is stop using your cards. The second thing to do is determine which debt has the highest interest rate. Pay that one off first. If you can accelerate the payment you will save on interest paid out and if possible, cancel that credit card.
Keep in mind that most credit card companies will not report your first late payment, but if you are late again in the next 12 to 24 months they will report to the credit bureaus. This one late payment can drop you credit scores as much a 50 to 75 points, which is substantial. So pay your bills on time, even if you can only afford to pay the minimum amount required.
Another item you need to know is the fact that you can charge too much to you credit cards and this hurts your credit score. I am not talking about simply going over your approved credit limit but I am talking about going above 75 percent of your approved credit limit. If you have a $2,500 credit limit do not go over $1,875. I know this may sound odd but the credit scoring computers consider any balances over that 75 percent mark as a sign of your inability to handle your debt.
Know that your credit history and the responsibility of correcting and maintaining it is up to you. There are absolutely no overnight fast and cheap ways to establish or repair your credit. So if you ever want to borrow someone else's money to buy a car, home or just a tank of gas you need to show those who give credit that you are worthy of receiving it.
Bob Kieber can be reached at (970) 262-1199 or at rkieber@comcast.net. He is a local mortgage lender and principal of Resort Lending.
