How can I establish credit?

Having a credit card helps you obtain a good credit standing. Ironically, you can not obtain a solid credit standing if you can not receive credit to beigin with. I often hear other moms ask - “Now, how can I get a credit card if no one wants to issue me one?” Below are some solutions to start establishing your credit.

Solution 1
Apply for a department store credit card. Go to your local JC Penny or Target and see if they will issue you a credit card. If you pay your bills on time, your credit rating will begin to rise. Although this is tempting, do not apply for too many cards at one time. Why? Because the credit reporting agencies may determine you cannot handle the line of credit based upon your salary. It is important to check the APR rate and terms of conditions when you are offered a new credit card. Some credit card companies offer tremendously high rates. Once you establish your credit, and you are current in all your credit card bills, you can then apply for a regualr credit card like a Visa or Mastercard.

Solution 2
Apply for a secured credit card. When you apply for a secured credit card, your credit is based on the amount of money you deposit into a checking or savings account. It is essentially like a debit card. The amount you charge on your credit card is deducted from your checking or savings account balance. If you continue to use and keep your account in good standing, your bank will issue you a regular credit card. You can check out “Capital One” - they are quite popular with this service.

Solution 3
Apply for credit cards through companies who offer credit to anyone without any credit standing. Note however, that these companies charge a higher rate than for others who have established credit. They will most likely require a bank account so open a checking or savings account so you can provide them with this information.
These are just some easy ways to start off with your credit. You can try applying for a loan, but, most places will not approve you if you have no credit history. If someone is willing to co-sign the credit for you, you may get lucky. My best solution would be to try out for a department store credit card first or a secured credit card. Just a tip though, try not to use up all your credit limit right away. Also, try make sure that you pay your bill on time. Try not to pay just the minimum payment due. All these tips can help increase your credit rating.

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