easy ways to improve your credit
Real Estate Adviser,
How can I rebuild my credit if I am having a
problem getting a credit card?
What a great question. Not only because a lot
of other people have a similar concern, but you've given me an opening
to mention that by the end of the year the Dummies book people will
have a new book out, by Mrs. Bucci's good looking son, specifically
designed to help folks like you repair their credit.
Your situation is not uncommon and there are a few
simple things you, and anyone having trouble establishing a good
credit history, can do to get your credit back on track. This includes
not only people with bad credit, but also people with no credit
history at all. Young people, those who pay cash for most purchases,
the recently divorced or widowed and immigrants are also among those
who may need help with credit.
Here are five suggestions anyone can use to rebuild
- Get a secured credit card.
Secured credit cards report your credit payment history information
to the credit bureaus just like a regular credit card. They are
"secured" by your money, which you deposit in a FDIC or NCUA insured
bank account for this sole purpose. You can get one for free if
- Get a department store
card. These cards are often easier to qualify for than
a general-purpose bankcard. Be aware though, that they may carry
a high interest rate. Be sure to pay your charges on time, and
in full, each billing cycle to avoid paying interest. You will
still accomplish your goal of building positive credit in your
name, with the added bonus of staying out of debt.
- Give yourself a loan.
Open a passbook savings account in a bank or credit union. Then
take out a low-interest loan using the passbook as security. The
bank will report the loan payment experience to the credit bureaus
and your credit will improve.
- Get a copy of your credit
report. If you are being turned down for credit you need
to be sure the reason is valid. Many credit reports have errors.
With over a billion items a month showing up at each bureau, it's
no wonder some end up in the wrong credit report. Dispute any
inaccuracies you find.
- Get a credit report from
all three bureaus. Each one may have different information
and maybe errors in your file. You can't know which bureau's data
will be used to evaluate your credit application, so check them
One last suggestion: don't apply for every card offer
that comes your way. Each one generates an inquiry in your file.
Too many inquiries can hurt your credit.
The thing to remember about your credit report is
that time is your best friend, as you keep adding positive information
to your credit report over time, any negatives will first be diluted
and then begin to recede in importance. They won't drop off completely
for seven years in most cases, but they do become less important
to future creditors evaluating your credit-worthiness.
I also suggest that you develop a workable budget
if you don't have one yet to keep surprise expenses from sabotaging
your efforts to rebuild your credit. Good luck!
Debt Adviser, Steve Bucci, is the president of Money Management International
Financial Education Foundation. Visit MMI
for additional debt
advice or click here
to ask a debt question.