It can be so frustrating to get a credit card if you don’t have any credit. There are some credit cards that you can get with no credit, but these are not ideal. With these types of cards, you’ll pay a higher interest rate and not get as many features. Try and build your credit before applying for a credit card. Here’s how.

To Start Building Your Credit

1. Get a bank account. Bank accounts go a long way in building your credit. Here’s the good news too…you don’t really need credit to open a savings or checking account. Your bank accounts will show lenders that you are responsible and stable with your finances.

2. Employment. Lenders like to see a strong employment history. They don’t like to see several periods of unemployment. This causes them to worry about the financial risk you’ll be when you aren’t employed. Get a job and stick with it.

3. Where you live. Have you lived in the same old place for a long time? Good thing. Lenders look to see how often you move around. The longer you live in one area, the more stable you are in the lender’s eyes. They also look to see whether you rent or own. Try not to move around a lot while trying to build your credit.

4. Utilities. If you live with roommates, put the utilities in your name. You’ll help establish your credit just by paying the electric, gas or water bill.

Those are some ways that can help you establish credit. Once you have established a little bit of credit, it is important to know where to start applying for credit cards.

Where To Apply For A Credit Card

1. Start with your bank. Your bank is a great way to start if you are applying for a credit card for the first time. Your bank is able to view your transaction history and see how well you manage your money. You have an established relationship with them already. Utilize that and get a credit card with them first.

2. Department store card. Department stores usually offer you a percentage off your purchase to save money when you apply for and use their credit card. Generally, this isn’t a smart idea because you get lured into the initial discount but don’t realize how high the interest rate is. However, if you are smart with your money and are trying to build credit, this may be the perfect place to start. Try and make a small purchase every month and pay it off before it is due. This is a great way to build your credit.

3. Secured credit card. A secured credit card is much easier to obtain than an unsecured credit card. A secured credit card is one that is tied to your bank account. It gives the credit company access to use your assets in case you fail to make your payments. If you are making purchases wisely, this could be a good route for you.

As you can see, there are several things that you can do to establish credit. You don’t have to have a long credit report to apply for a credit card. However, you will want somewhat of a credit report before applying. This will give you more options to choose from and keep your rate lower.

Related Posts

• 15 Ways Credit Cards Can Make Your Life Better
• Rebuild Your Credit With a Secured Credit Card
• What To Do If Your Credit Card Limits Get Cut
• Have Bad Credit, But Still Need a Credit Card?
• 5 Ways to Repair Your Credit

Tags: build credit, Credit Card Advice, secured credit card

This entry was posted on Monday, August 25th, 2008 at 12:43 pm and is filed under Credit Card Advice. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.