Bad credit can indeed be harmful to your finances. After all, if suppliers see on your record that you have bad credit, it’s unlikely you will be able to apply for loans. And it can harm your chances of getting a mortgage in the future. But there is also another credit that isn’t so good, and that is no credit. If you haven’t paid for many bills via direct debit before, or haven’t had a credit card, you might have no credit behind you. And then you will also struggle to take out loans and mortgages in the future. However, there are some ways you can get a good credit rating. In fact, here are some simple ways to build up your credit.
Get a credit card
It’s a good idea to get a credit card if you want to build up your credit score. After all, if you make a few purchases on the card, and pay them back timely, it can help you to earn some good credit. Of course, it’s best to make sure you get a card that has a good interest rate. After all, you don’t want something which will accumulate interest almost straight away. In fact, you ought to get a credit card via your bank. That way, you know it’s a reliable credit card that won’t get you into debt. And as you already have accounts with them, you should be able to log on and manage your current and credit accounts at the same time. Just make sure you only stick to one credit card for the sake of your finances.
Find a no credit loan
It can be hard to build up credit when you keep getting rejected for loans as you have no credit. But there are some loans out there which you will be accepted for with no or bad credit. In fact, you can get ones like a no-credit car loan which will ensure you build up credit as you pay off your vehicle. Of course, you can expect a significant interest rate with one of these loans. But even if you take it out for a year or two, it will soon build up your credit if you pay it on time every month. And then you will be able to take out more loans in the future due to your good credit!
Take a loan out with a partner or a friend
You might struggle to build up credit on your own as you will keep getting rejected due to you’re no credit rating. But if you join up with a trustworthy partner or a friend, you could soon be accepted. And then you can earn good credit at the same time as them. It might be a simple phone bill that you take out together. Or you can get them to add you to the household bills. And then you will soon be building up credit so you can get loans out on your own in the future! Just make sure you trust them, so you don’t end up regretting the decision.
And remember to pay bills on time. Every time you do, you are taking steps towards a great credit score!