5 Credit Tips That Don’t Include Stealing your Mom’s Credit Card
Rather than stealing, or ahem “borrowing” your mama’s credit card, here are 5 tips you can put into action right away to start building credit. Soon, the buying power will be yours, all yours.
1 – Buy Jewelry
Sure it sounds weird but jewelers are one of the easiest places to get credit when you’ve got none to call your own. Opt for a recognized jeweler with lots of locations. Buy something that’s not too pricey and ask to finance it. Then, make those payments on time. This will enable you to build a good credit history. Within a 3-6 months you should be able to apply for a credit card. Go for one with the lowest APR and no annual fee.
2 – Buy Furniture
Same as with jewelers, furniture dealers will often extend a line of credit to buyers with little to no credit. If you’re going away to college, you can finance that sofabed, or, if you’re getting a place of your own, get yourself a bed and nightstands or a living room couch, but be sure not to overspend. Work out the monthly payments ahead of time to be sure you can afford them. The last thing you want to do is overspend and jeopardize your credit even before you’ve started.
3 – Get a Secured Credit Card
Secured credit cards require a cash collateral deposit that becomes the credit line for that account. For example, if you put $1000 in the account, you can charge up to $1000. Look for a secured credit card with the lowest APR you can find and few to no fees. Also prior to applying, be sure to read the fine print or call the credit card issuer directly and ask them if they report to all three major credit bureaus (Experian, Equifax, and TransUnion).
4 – Take out a Loan with a Cosigner
If mom, dad, or Auntie Edna has great credit, ask them if they’ll co-sign for you on a loan. Bear in mind, what you’re asking for is no small favor. A co-signer agrees to assume responsibility for the loan in the event that you default on it. So, if they say yes, know that they’re putting their neck out for you. As with any other loan, be sure you can make the monthly payments no matter what, even if you lose your job, need emergency auto work, whatever, just make good on your word and make that loan payment every single month. Fail to make those payments on time and your co-signer’s credit will take the blow as will your own.
5 – Become an Authorized User on Someone Else’s Account
If mom, dad, or lovely Aunt Edna pay their credit cards on time and have good credit, why not ask them to include you as an authorized user on their account? This will help you build credit but only if the credit card they add you to requires them to include your social security number. If the credit card company doesn’t ask for that bit of information it means they will not be reporting the credit activity on that card to the credit bureaus on your behalf. Whether Aunt Edna actually gives you your own copy of her credit card is up to her. In any case, as long as the credit card company asks for your social security number, they’re reporting any and all activity (the good and the bad) and that’s becoming part of your credit history.
So now you know–you’ve got options when it comes to building good credit. Hopefully at least one of our 5 tips will help get you on the right path. So now, you don’t have to steal your mom’s credit card, you can build your own!