Establishing or Re-Establishing Credit

When I worked as a loan officer people in their early 20s had the most difficult time being approved for credit. The most common reason was due to lack of credit history.

To build or rebuild credit some of the easiest places to be approved for credit are department stores. Stores like Target, Dillard's, Best Buy, Old Navy. A store where you are not looking to buy thousands of dollars of merchandise.

Most stores will give someone young a credit limit of $300 to $500. Now the key to building credit is to charge something for maybe $50 to $100. The important step is not to pay off the balance right after you receive your first bill. Some people ie your parents will tell you that you should pay off the credit card in full each month to build your credit. They falsely believe showing that you never carry a balance is good.

However, they do not realize most creditors do not report for two or three months after an account is open. Charging $100 and then paying off the balance the next month never establishes a balance and therefore thecreditor will not report any activity to the credit bureau.
Not good.

No matter what any tells you this is what you need to do to establish a credit history.
1. Buy something $50 or more
2. Pay minimum payment even if only $10 each month
3. NEVER MISS A PAYMENT!!!
4. Pay minimum for three or four months
5. Then pay off balance after fourth month
5. Will show 4 on time payments on your credit report
6. You just established a credit rating!!!! Very GOOD

Now after doing this and you decide to charge something again for $100. NOW you should follow your parents advice about paying off your credit cards every month.

My book is now complete!!! Finally. Go to www.debtstrength.com to purchase.

Teddy Danfield