Establishing Credit ? What You Need To Know Part 2

In my previous article "Establishing Credit ? What You Need To Know Part 1" I discussed the need for a good credit history and what lenders were looking for prior to loaning an individual money or additional funds based on their credit history. This article will go into the necessary steps someone needs to take in order to initially establish their credit history.

The first and easiest step is to show any potential lenders that you actually know how to handle money. This can be easily achieved by opening either a savings or checking account (opening both would be better) in your name. As you successfully use these accounts you will prove to a lender that you can handle money and are ready for the increased responsibility that comes with having additional credit.

Another means of establishing credit actually involves borrowing funds and then paying them back over time without any late payments. Although this method to establishing a good credit history is quicker and very effective when compared to the long drawn out procedure of making withdraws and transfers to your savings/checking account it comes with the drawback of the cost associated with obtaining the loan in the first place. If you're having trouble obtaining a loan but still wish to use this method to establish your credit history then seek out a friend or relative with known good credit and have them cosign on a loan for you. Remember this is asking a lot from that individual so please don't abuse the trust they put into your ability to repay the loan on time and without problems.

Other popular methods of establishing credit include applying for credit cards or department store cards. Again, although this method is very effective for establishing credit (provided you make your payments on time) it could be costly if you start to carry a balance on these cards. Always check to see that there is no annual fee and make sure you are aware of the financial charges imposed against you if you should decide to carry a balance on any card you have. Obviously the best plan is to always pay your balance off in full each and every month. This allows you to build your credit history and avoid being buried under a mountain of high interest debt.

A word of caution ? identity theft and credit theft is a very real and dangerous problem in today's society so you want to make sure you do everything you can to protect your newly established credit history. Always make sure to secure your credit cards and never let anyone obtain your personal identification number (PIN). If you have numerous credit cards avoid carrying them all at once. Instead just carry the card you normally use and file the rest away in a safe place. Always make sure to keep information such as contact numbers and account numbers of the cards you have been issued. This will help you if you ever lose or have a card stolen.

If you find that you have lost a card or had it stolen simply contact the company that issued the card and report your situation. If the card hasn't been used prior to your reporting it lost or stolen then you're relieved of any future financial liabilities against the card. If it has been used prior to your reporting then you may be held accountable for up to $50. Finally, always be cautious about who you give your account number to and remember to keep all receipts and records that are associated with that particular card.

Establishing a good credit history isn't that difficult if you start small and work your way up. It will take some time but if you do it right it will definitely pay off in the future and allow you the opportunity to obtain credit for the items you really want to purchase or may really need.

Timothy Gorman is a successful Webmaster and publisher of Debt-Relief-Solutions.com He provides more debt relief, consolidation and free credit counseling information that you can research in your pajamas on his website.

---

Always Avoid Payment Holidays

Once you've been paying off a credit card for a... Read More

Credit cards

If gold medals were awarded for marketing consistency, the credit... Read More

Credit Card Dirty Tricks

There are many of us that have been badly stung... Read More

What You Need to Know About Interest Rates

For all people shop around for the best rate, there... Read More

Top 5 Reasons To Check Your Credit Report Regularly

#1 Make sure mistakes aren't hurting your credit.Reviewing your credit... Read More

The Ghost of Expected Surprises

Here, Cratchet, what do you think you're doing?Uh, er, leaving... Read More

SuperCharged Secret 4, Credit Card Utopia

YOU SCRATCH MY BACK, AND I'LL BUY SOME MORE BEER!Let's... Read More

What To Look For In A Credit Card

When you are deciding what type of credit card to... Read More

Defeating Credit Card Debt With Self Control

Credit card debt is a major social problem in some... Read More

The FICO Score Misconceptions

There are many misconceptions about credit scores out there. There... Read More

Make Sure Your Credit Report Is Correct to Improve Your Interest Rates And Lower Insurance Premiums

Did you know that you could make sure to get... Read More

Is Your Credit Score Costing You Money?

Most of us want a good credit report to obtain... Read More

A Summary of the Fair Credit Reporting Act

This summary of the Fair Credit Reporting Act will explain... Read More

Credit Repair, How To

Credit repair, is in a word, vital to reestablishing your... Read More

Do you Know the Benefits of Checking your Credit Report?

Do you know why you should check your credit report?Of... Read More

Easing Your Financial Burdens With Credit Counseling

It is a well-publicized fact that more of us are... Read More

How To Prevent Fraudulent Credit Card Transactions

What Are Possible Signs of Fraudulent Transactions see at Web... Read More

Common Credit Score Myths

A lot of credit score myths about fico score ratings... Read More

Dont Fall for Credit Repair Scams

We've all seen the ads on television or in magazines,... Read More

Useful Tips When Choosing Credit Cards

Chances are you have received your share of "pre-approved" credit... Read More

How did a Thief get my Name? Don?t be a Victim of Identity Theft

How do these people get my name? If you have... Read More

Stop Credit Card Offers

You can stop receiving credit card offers in the mail!... Read More

Credit Cards for Home Business

It is wise for you to have a company credit... Read More

Online, Phone, U.S. Mail or In-Person: Where is Your Credit Card and Personal Identify Safest?

Identity theft is the fastest growing crime according to the... Read More

Good Credit is King, When Qualifying for Mortgage Programs

If you want to purchase a new home or refinance... Read More

How To Use Your Credit Cards Wisely

Are you one of the thousands pulling your hair out... Read More

Ways to Look Good without Selling Your Soul to the Credit Card Sharks

1. Buy clothes at thrift stores. BEFORE you buy them,... Read More

Why Americans Find Predatory Lending Offensive

"Menis - the author translates as "indignant rage" - It... Read More

Myths and Truth about Credit Scoring

Credit score is the key factor determining approval of almost... Read More

Establishing Credit ? What You Need To Know Part 1

Establishing credit is one of the most important things you... Read More

Saving Money: Quick Cash, High Cost

I didn't think it was possible. But it is. Folks,... Read More

Different Ways to Borrow Money

There are many different ways to borrow money. Outlined below... Read More

Credit Report And Correction Techniques

The three major credit bureaus, Experian, Equifax and Trans Union... Read More