What are the Fastest Ways to Build Credit?
Having a credit card or loan at your disposal makes it possible for you to buy the things you so badly need or desire, and thus make a difference to your living standards. But in order to avail the same, you need to have a positive credit history and good credit score. Here are some tips on how you can build credit scores quickly.
Get the errors on your report corrected
It is human to err and is very much possible for mistakes to crop up on your credit report. Some of these include incorrectly spelled names, a mismatch in social security numbers, payment credits to the wrong account and so on. There could also be payments marked late incorrectly or negative information in your credit history, which is way too old to be included in the report. Irrespective of what the mistake is or who is at fault, it is important that you dispute the errors by availing the free report from major credit card bureaus.
Pay all your bills on time
Nothing works like timely payments in boosting your credit score. Paying later than the due date has a negative impact on your credit history and can appear as a black mark on your credit report for up to seven years. You can choose to schedule bill payments so that you do not miss the deadlines. But in the rare instance that you do, call up the credit card or service provider after arranging for payment and see if they can remove the entry. Many will be willing to do this considering how genuine your case is. But in doing so, remember that the longer it takes for you to pay up, the more your score gets hurt. Paying late by 60 days has a more negative impact than paying late by 30 days.
Consider micropayments
While paying the lumpsum amount at the end of every billing cycle is the norm, you could also consider making smaller, frequent payments throughout the month. This could be as soon you make a purchase or on a routine basis like every week or fortnight. Using micropayments has two advantages. Firstly, it keeps your credit balances low. Secondly, it helps bring down credit utilization, which is basically the percentage of the credit limit that you have used up. Lower credit balances and utilization directly and quickly build credit scores, helping to keep them on the positive end of the spectrum.
Raise your credit limit
Another way to lower credit utilization is by working the reverse – keep your spending the same, but increase your overall limit so that the percentage comes down. This is possible when you have a higher allowed spending limit on your credit card. However, when applying for the same, ensure that a hard inquiry that affects your score is not undertaken. You can always check for these details with your card issuer.
Get added as an authorized user
Yet another means to build credit quickly is by getting added as an authorized user to a family member or friend’s card or tradeline. This helps you build a longer and more credible credit history, given the person who is adding you has a higher credit limit and a history of responsible usage and timely payments. The person can do so without event disclosing the card details or letting you use the card. The method greatly helps people with little credit experience or short history.
Consider buying tradelines
You aren’t alone if you cannot find a family member or friend who has a good credit history. There are thousands of others who suffer from the same crisis, and thankfully, there are tradeline sales companies to the rescue. Such companies sell other peoples’ tradelines for a fee, typically for a short duration of time. They act as middlemen in finding you the best tradelines that meet your goals and help improve your scores. Something worth considering here is that this process involves the exchange of private and confidential data like IDs and social security numbers, often with complete strangers. Hence, it is important that you choose a tradelines sales company that is legal and legitimate in order to prevent misuse of sensitive information and to ensure that you don’t lose money in a bid to build credit scores quickly.
