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Information On First Time Credit History And How To Establish One

Establishing your first time credit history can be a daunting task. Credit is needed for everything in life. First time credit history and how to establish one is not necessarily as difficult as you may think. Though credit history is required for taking out any loans (except for many student loans), securing an apartment, getting a decent credit line, purchasing a home, and many other things, it is not as difficult to get as some make it out to be. Instead of just focusing on getting a credit history, however, make sure that you focus on truly building yourself a great credit score instead of simply a subpar credit history.

What Is A Credit History?

First time credit history and how to establish one begins with knowing what a credit history truly is. Your credit history will be found on your credit report. First time credit history and how to establish one should deal more with gaining yourself a fantastic credit score, and in order to do that you must know what it is. This is a record of each individual's borrowing and repaying information. On this credit history you will find late payments, bankruptcy, and collection agencies. If you are working on your first time credit history and how to establish one, you may be curious as to how this record is built and what it is used for.

Your credit report is used any time you apply for any type of credit. The lending institution (be it a store, a credit card company, or a bank), will forward your information to the credit bureau. They will then match your information to your credit report. Lenders will use this information to determine whether or not you will be able to or willing to repay any debt you will accumulate. If you have a poor credit score, chances are you will be seen as unwilling to repay debt. You may still get a loan or credit card, but you will most likely have very high interest rates to pay. With a great credit history or credit score, you will almost always be approved for the credit you seek and will get very reasonable interest rates.

Your credit history or credit report will be ruined by late payments or no payments at all. If a lender sees that you have a history of bankruptcy or failure to make even minimum payments on credit cards, it is doubtful that you will find a lender to help you in your situation. When thinking or first time credit history and how to establish one, remember that the key to establishing good credit history is to pay all of your bills on time. Any bill that you have could lead to a dip in your credit score if you pay it late or not at all.

Basics On First Time Credit History And How To Establish One

Establishing a great credit history is not as difficult as it may seem. You have heard all of your life that you need a great credit score to survive in life. You have heard from parents and peers alike that you must find a way to build credit before you get into the "real world" or else you will have no place to live, no vehicle to drive, no car insurance, and no credit cards. The stress can be very strong to properly establish credit.

However, there is one simple and easy way to establish your credit. If you have some money put away and plan on purchasing an expensive item, go ahead and do it, but use a credit card. Almost anyone can get their first credit card without any credit history. Purchase your large ticket item and then pay it off over the course of three or so months. That way you will accrue very little interest over those three months, and you will show future lenders that you are able to repay within a timely manner. If you do not have the money to pay for your expensive item, then use your credit card on a monthly basis for one or two things, like a trip to the grocery store or the movies. Then pay them off every month. If you do this, you have figured out first time credit history and how to establish one.