Build

It's much easier to start with good habits than to repair black marks later on.                                                                 

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Restore

You are invited to the most effective program available to clear mistakes made by creditors.

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Protect

Once you have obtained excellent credit, it is necessary for you to protect it.                                             

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Building Your Credit Profile

 

In many countries credit scores do not exist. Therefore there is no way to know how likely it is that a potential borrower will pay you back. This is a severe detriment to those economies since the risk of lending is so high. The credit scoring system allows a lender to estimate the likelihood that a borrower will repay their debt, which facilitates the flow of money throughout our economy.  Credit is an asset which can be just as important as the cash you have in the bank.

 

How to Establish Credit

 

Begin by opening individual savings and checking accounts in your name. Over time, your deposits, withdrawals, and transfers will demonstrate that you can handle money responsibly.

Applying for a loan is another option, but be aware that this method of establishing a credit history will cost, since loans require the payment of interest.

You could take out a bank loan secured by the funds you have on deposit or by items you own, such as a car. You could also ask a friend or relative who has good credit to cosign a loan, which means that he or she shares liability for the loan with you.

You could also apply for department store and gasoline credit cards, which generally are easier to obtain than major credit cards. Before you apply for any credit, however, make sure you understand the terms. For example, how long is the grace period or the time you have to pay the current balance in full before finance charges are added? Is there an annual fee or other fees associated with the credit? If you believe that you will carry a balance, you need to know how finance charges are calculated.

Patience is important in this process. It takes time to establish credit and build a record of consistency in making payments to demonstrate your creditworthiness. And it is much better to go slowly and develop a strong credit record than to apply for too many credit cards or a loan that is larger than you can handle.

Start slowly, be cautious, keep track of your overall debt, and pay on time. Most importantly, remember that credit actually represents real money and has to be repaid with interest.