Credit

When you are first establishing your credit, you can make a huge difference in the quality of your credit report with some seemingly insignificant actions. Your credit report contains information that is used to create your credit score. Companies use your credit score to decide if you qualify for loans, lines of credit, and other conveniences. It is also used to determine how high your interest rate is for these items. So use your first credit card wisely to save yourself headaches in the future. Here’s how:

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You can obtain a FREE Credit Report from Equifax, Experian, and Trans Union by completing and mailing the Annual Credit Report Request Form to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. This form can be printed from www.ftc.gov/credit There is also a toll free telephone number to call to request a copy of your free credit report: 1-877-322-8228. You will need to provide the following information to get your free credit reports: Your Social Security number, your name and address including your previous address if you have moved in the past two years, your date of birth, as well as some other information that only you would know such as the amount of your monthly mortgage payment.

If you request a copy of your free credit report online, you will be able to obtain it right away. If you call in or mail your request with the Annual Credit Report Request Form, your request will be processed and mailed to you within 15 business days after its receipt. This time period may take longer if the nationwide consumer reporting company needs more information to confirm your identity. If there happens to be an abnormally high volume of requests for free credit reports at the time you request yours, you will be notified that your report will be mailed to you sometime after 15 days of receipt.

To purchase a copy of your credit report, you may call the consumer reporting companies direct with the following telephone numbers:

Equifax: 1-800-685-1111 Experian: 1-888-EXPERIAN (1-888-397-3742) Trans Union: 1-800-916-8800

The cost to buy a copy of your credit report is generally $9.50 or less for each agency.

Each nationwide consumer reporting company gets information from different sources so the information contained in any one report may not be the same. The information may not reflect all of your credit info so requesting a free copy of your credit report from all three major agencies is the best way to get the full story of your credit.

This article was written by Kriss Standke who is an accomplished Webmaster and publisher of Free Credit Report Spot, Credit Score Resource, and Check Credit Report Online where he provides detailed and informative articles, tips, and advice on free credit reports, how to get yours, and what to do with the information once you receive it.

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Many countries use a system of ‘credit’ in order to do business with the public. It is in fact, a very good method in order for merchants to minimize losses. The issue is when a person or business does not have an established credit, it is extremely hard to receive loans, and apply for other unsecured benefits. I have provided many tips and strategies which should help in establishing good credit. Please be advised that good credit takes time.

Getting your first line of credit:

1. One of the best methods of obtaining good credit is by having revolving accounts. Revolving accounts are type of loans that allow the borrower to keep spending as long as they have sufficient balance and continue to make regular payments on the already used balance. Credit card and line of credits are revolving accounts. Without good credit it is hard to obtain a revolving account. I think the best way to do this is by applying for secured credit cards. This means, a financial institution will take a specified amount of money from the borrower and place this in an interest bearing savings account in their name. In return, they will be granted a credit card with the same spending limit as the deposit. The credit card operates just the same as a regular credit card. The only difference is the financial institution has the deposit in case the borrower decides not to make any more payments. Please be ensured that as long as you have been given a secured credit card from a reputable institution your deposit should not be at risk. In order to build your credit it is important that you make all your payments on time. Only payments that are at least thirty days late are usually reported to the major credit bureaus, but be aware of late charges, that will usually be incurred by the financial institution.

2. If you are a college student you may be eligible to receive a ’student’ credit card. Many financial institutions offer unsecured credit cards to college students, but these cards will usually have higher interest rates as well as lower spending limits. Do not be discouraged by this, as a well managed credit card will only be of good to you in the future. The way to reduce the interest you pay is to make higher payments each month.

What’s next?

1. Ok, so you have your first revolving account, what comes next? Try to follow the same procedure above to receive two or three accounts. Make sure that you pay on time every month. After about six months try applying for other unsecured credit cards. Your credit would still be considered a ‘high risk’ but you would have established some degree of credibility. With a little luck you will receive offers. Never make too many applications as this does not help your credit and will create a red flag to potential lenders. Please remember, establishing credit is a gradual process, it takes time and plenty of it. Repeat this process every three months or so. Another strategy is to keep paying the credit cards you currently have, for a much longer period of time, and apply for other cards when you are ready. The longer you have an account the better it is for your credit. Also, maybe one of the worst things you could ever do is apply for store credit cards at every store you visit. Store credit cards are good at building your credit but it is very tempting to apply for them all, considering that they are usually offered along with a discount on your merchandise. Be wary of the fact that too many revolving accounts will do more harm than good.

These tips should prove very helpful in your search for good credit:

1. Do not make too many applications for credit.

2. Keep making payments on time, all the time-Missing payments hurts.

3. Do not keep a ‘no balance’ credit card (a credit card with none of the spending limit used) - You need your good paying habits to be constantly reported to the credit bureaus.

4. Do not have too may revolving accounts.

5. Try not to use too much of the available balance on your accounts.

6. Do not keep closing out accounts and reopening new ones.

7. Avoid unnecessary debt.

8. Avoid Financial Institutions that charge a fee to report your paying habits to the Credit Bureaus.

If these tips are followed then you are almost guaranteed that your credit ratings will be improved. The next thing you should do is properly discard of any documents with private information such as your name, address, date of birth and social security number. A wise investment is a shredder for your home, as identity theft is very rampant in our society. There are many credit watch programs out there which allows you to check on your credit at all times so you will be aware when any unknown inquiries or accounts are opened in your name.

Nicola Hall is passionate about helping deserving people to achieve their goals. She is the founder of 123estuff.com where she provides many self help ebooks at discounted prices. The store also provides free articles. She will continue to provide information to others that will help them in achieving success.

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