If you are looking to buy a house and don’t have the best credit score your in the right place.
Over the years I have come across a few tips and tricks to increase my credit score, and build my credit score from nothing. I would like to share these tips and tricks with you guys!
Make EVERY Payment On Time.
One of the simplest things that you can do to boost your credit is to pay every bill ON TIME! This is a no brainer. Lenders want their money back. They loan to you with expectations of receiving their money back with interest. Same thing goes for buying a house. If you don’t pay your car payment on time why would you pay your mortgage on time?
Increase Your Credit Limit, And Decrease Your Credit Utilization.
Here’s a big one that most people don’t know about. Credit unions look at how much credit line you have, and how much of it you use. Now, being allowed to spend $10,000 and only spending $1,000 of it is much better then being allowed to spend $10,000 and spending $9,000 of it. Tricks for this. Call your current credit card companies and ask for a credit increase. Also, you can try to open an additional credit card and keep the usage very low. Just remember to keep your usage low.
Utilize A Credit Card That Benefits You.
My personal favorite trick to building your credit score is to use your credit card for all of your everyday purchases, and pay off the statement balance each month. If you do this, I highly recommend choosing some sort of rewards credit card to use. Cash back credit cards work very well with this method. I get cash back on EVERY purchase, AND build credit each month, all without taking a single hit of interest. I learned this method from one of my all time favorite books “I Will Teach You To Be Rich” by Ramit Sethi.
Apply For A Secure Loan Or A Credit Building Loan
American Family Insurance has a great article explaining this step (Step 8). You can deposit a few hundred dollars into a secured loan savings account, which acts as collateral on a loan from the lender. Then, you’ll make scheduled payments that are reported to credit bureaus until you pay back the loan in full. You will then get your deposit back once the account is closed. If you want to learn more about Secure loans to build credit, take a look at this article by Nerd Wallet. They do a wonderful job explaining the entire process and explaining if this option would be good for you. Typically, if you don’t have credit established or not much credit history this could be a great tool to get started.
Rent Reporting
Another tool to build/improve your credit is Rent Reporting. There is Landlord-enrolled systems. This requires a cooperative landlord, and there is non-landlord-enrolled systems. You will need to link your bank account to a service that will recognize your rent payments directly. Finmasters explains these two options in more depth if you care to learn more.
Final Thoughts
If you have any other tips and tricks to building credit show them off in the comments to help fellow credit builders! Feel free to reach out to me privately if you’re not comfortable posting, and I will gladly look into and post them for you. I like to keep the blogs short and sweet to keep interest. I’m always looking for ways to improve the website and topics that would be good to blog about. Please contact me by utilizing the homepages “Contact me” tool.
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