Purchasing a slick new car, starting your own family, buying a home: life’s biggest moments usually require a stellar credit history.
If you’re young and have avoided debt, or you’re new to America and your credit history doesn’t translate here, it’s essential to start building credit now. While there are no instant fixes, you can take short-term actions to improve your standing quickly. Here are three simple steps to start building credit.
- Cover the Basics
Before you can start building your credit, you’ll need to have a few things in place.
Your credit history is tied to your social security number and tax ID. If you’ve recently immigrated and don’t have either, getting one should be your top priority. A tax ID is easier to get, but a SSN is better in the long run. Contact the Social Security Administration or an immigration attorney for more advice.
Similarly, if you don’t have a checking account, you should open one immediately. Even though it doesn’t factor in to your credit scores, no lender will take you seriously without one.
- Check Your Credit Scores Often
Let me dispel a huge myth: checking your own credit scores won’t hurt you (if other people are checking, that’s a different story). View your scores to see where you stand and review for errors. Almost 80% of people have some sort of error on their credit report—clearing up those mistakes can significantly improve your scores.
You can get up to three free reports from AnnualCreditReport.com, but they won’t include your FICO® scores, which lenders use to evaluate you. To access your FICO® scores, check out Regal Financial’s premium Credit Reports.
- Open a Credit Card
On your mission to build credit, your credit card will be your best friend—if you use it correctly. If you have no credit or bad credit, start with a secured credit card; it works like a debit card (you can only spend what you have), but it allows you to safely build a solid credit history.
After a year of using a secured credit card, remove the training wheels and apply for an unsecured card. Also, be wary of opening too many cards at once—wait 4-6 months before applying for a new card.
For a free consultation or to learn more about our credit management services, including our Credit Development Plan designed to create excellent credit in 8 months, contact Regal Financial.
The only way to truly prevent identity theft is by blocking your credit entirely. Contact Credit Block today.