Building credit score.

[orenwach]

I'm bothered by the fact that you used freecreditreport.com - make sure to cancel that before they start charging your credit card. You should use annualcreditreport.com for 3 free credit reports a year (one per credit agency) or a site like creditkarma.com or creditsesame.com for free monthly updates.

Good luck increasing your credit score.

[mrpaseo]

When I first started out I went to the bank and requested a $1,000 loan. They told me I had no credit history so they recommended I get a "Secured Loan". After explaining what that was, I took $1,000 dollars an put it in an account. They froze the account (I could not touch it) and loaned me the $1,000 dollars.

My original $1,000 was in an interest bearing savings account... I asked them to place the $1,000 dollars in the same account and to deduct them monthly payments from that account. So, I had $2,000 in the account earning interest, with only $1,000 available (My original grand was frozen). Each month they went in and took out $80 or so dollars for the payment and then after 8 months I went back to the bank and requested to settle the loan.

Following this loan, I easily obtained a department store CC of which I charged an item and paid the balance in full each month. Shortly after I obtained my first Visa card.

Simple steps that take a little time,
Ray

[pdweaver]

Do you have a spouse or close relative with good credit who would be willing to add you as an authorized user on one of their oldest credit cards in good standing? If so, I think you could use this method to at least boost your FICO scores above 650 so you'll be in the "fair credit" range.

Then you could get one no annual fee credit card of your own, use it sparingly (use no more than 30% of your credit limit), and always pay your bills on time and in full every month. After 6-12 months of responsible use, your credit scores should hopefully bump up in to the low 700s. I wouldn't actually take out a loan to build credit unless you legitimately need the loan for something else.

This is going to be your best bet on increasing your score. Follow this post and you will be able to build your score up. It will take time to get there, but it's worth it. Credit is a must. I work at a bank and constantly have customers ask how to build their score. Also, having multiple cards isn't bad. Take a look at credit karma, it's a web site that will provide your score free of charge. They also provide a report card that allows you to input ways that will help raise your score. Most importantly, do not use more than 30% of the credit line and always make payments on time.

[Kooshiball]

How I start was to get credit card (Student credit card) and starts to use it. I did not overleveage credit card something like 20 - 30% use. This should increase the score by 50 or so... Paying back what you owe by due date in every time is essential to boost your credit score.

In spite of needs of using credit card (I can't imagin my life without it...), it is essential to have solid credit score so that you can access to many things like getting the loan.

Good luck!

[thefrugaltoad]

There are many reasons your credit score could be low. Too many credit inquiries, too high a debt to credit limit balance, too high total debt, late payments. Some suggestions: pay off as much debt as quickly as you can, do not miss a due date, and do not take any action that would result in a credit inquiry. Read Finance for Dummies - Credit Reports for further information regarding credit reports. Also use annualcreditreport.com next time for free annual credit reports!

[SeanH]

Looking at creditkarma.com - Paying off my student loans (~$13k when I checked I believe) resulted in a 50 point increase in my score. Increases associated with use of a credit card (on-time payments, low utilization) are slower - my most recent two increases were associated with 4 (5 points) and 5 (6 points) months of use.

[SIRC4SM]

I lost my ID "Sir Casm" so i am using this one.
Well for what i have heard and read better to stay debt free. I payed up half of my credit card debt. Now I have under 50% of my credit limit, other than that i have no debt. how long do you think it will talke to pull my score from 600 to 700 if i keep my credit card under 30% and pay it full every month.

[JoshuaHeckathorn]

I lost my ID "Sir Casm" so i am using this one.
Well for what i have heard and read better to stay debt free. I payed up half of my credit card debt. Now I have under 50% of my credit limit, other than that i have no debt. how long do you think it will talke to pull my score from 600 to 700 if i keep my credit card under 30% and pay it full every month.

There are too many other factors at play in your credit profile to give you an exact amount of time, but think about it this way. Payment history and credit utilization account for 65% of your FICO scores. If you continue to pay on time and keep your credit utilization low (preferably around 10% or less), you're doing the best thing possible for your credit scores. It could take 6-12 months, maybe less, but you just need to be patient and your scores will eventually climb into the 700s, especially since you don't have any other negatives on your credit reports.

[breathemusic]

There are too many other factors at play in your credit profile to give you an exact amount of time, but think about it this way. Payment history and credit utilization account for 65% of your FICO scores. If you continue to pay on time and keep your credit utilization low (preferably around 10% or less), you're doing the best thing possible for your credit scores. It could take 6-12 months, maybe less, but you just need to be patient and your scores will eventually climb into the 700s, especially since you don't have any other negatives on your credit reports.

Where did you get this info to know that payment history and credit utilization account for 65% of the score?

I've done some basic searching that tells me very generally what makes up credit scores, but nothing with percentages, and nothing with detail like "keep you utilization below X%" or "it's best to have a credit line for at least X years" etc. That's the kind of information I'd like to gather.

My score it pretty darn good right now at an average of 775 between the 3 agencies, but I can't figure out what I have to do to push it over the edge into the 800s!

[JoshuaHeckathorn]

Where did you get this info to know that payment history and credit utilization account for 65% of the score?

I've done some basic searching that tells me very generally what makes up credit scores, but nothing with percentages, and nothing with detail like "keep you utilization below X%" or "it's best to have a credit line for at least X years" etc. That's the kind of information I'd like to gather.

My score it pretty darn good right now at an average of 775 between the 3 agencies, but I can't figure out what I have to do to push it over the edge into the 800s!

The best place to do your research is on FICO's website, myFICO.com. That's where you'll find the percentages I mention along with a great deal of other good information. FICO also publishes a blog I follow, called the Banking Analytics Blog, which releases interesting data and insight into how FICO scores work. You might want to check that out as well.

It sounds like you have excellent scores already, so I wouldn't be too overly concerned about trying to push your FICO scores into the 800s. Scores in the high 700s should qualify you for the best rates and terms on any loan.