building credit

Simply put, I need to work on my credit. My credit history is not bad, just short. This came up back in April when I was told that I would need a cosigner for a car loan. (OTOH, this could have been due to not having a solid income figure, but I digress)

Currently, I have a gas card that I pay in full, ontime every month, for a year now. I have about 10k in student loans that I will start paying back in June. The only thing I have had in the past was about $1200 in student loans from my failed attempt at college and I paid that off in half the time.

I'm wondering if I should use something like freecreditreport.com or such.

Yeah about that:

http://redtape.msnbc.com/2006/09/dont_fall_for_f.html

Don't use that site. They're scam artists.

Use this instead to check your credit.

i have heard several thing about not ussing them, i was just unsure of other sites to go thrue

Yes, that's a much better site, but I'm confused as to why do you need to check your credit report to build your credit report?

To build credit simply get a couple of other cars and use them sparingly. Pay them off each month or just make a payment, the credit bureaus can't tell the difference.

Stay below 50% of your credit limits on the card for maximum credit scores.

The issues with just having a couple of pieces of credit being reported is that if there is ever a mistake made then you don't have enough other credit to dilute the impact of an erroneous 30 day late.

Stay away from Citi anything and Cap 1. They make mistakes often and are loathe to fix it.

If you need to build credit, use a couple of store credit cards. That, combined with your auto loan, should get you plenty of history.

I just wanted to see where I stand. But I think i should just do what i can to improve it and save my one free report for the year when i go for, hopefully, a loan on a bike in the spring.

No, i ended up buying my neon r/t with cash, the loan I was looking at was for an '05 focus, and it was gone by the time I had a definate on my new job.

Store credit cards aren't any easier to get than MC or VISA so why not get a card that you can use where you want to use it?

Just make sure that whatever card you get reports to the credit reporting agencies. Many of the secured cards don't report and a lot of them only let you use them to buy THEIR stuff. In other words it's not really a credit card, you are just prepaying.

Something which has worked for friends in the past: go to a couple of those non-bank loan places (NOT the 'payday loan' people!) and take out, say, a $500 loan for 6 months from each place. Put the money in a savings account and pay it back on time each month. At the end of the loan period, you'll pay probably $40-$50 in interest on each loan, but you'll have a stable payback history.

Jensenman wrote: Something which has worked for friends in the past: go to a couple of those non-bank loan places (NOT the 'payday loan' people!) and take out, say, a $500 loan for 6 months from each place. Put the money in a savings account and pay it back on time each month. At the end of the loan period, you'll pay probably $40-$50 in interest on each loan, but you'll have a stable payback history.

The trouble is that most of those places don't report credit histories to the credit bureaus.

(just found out you can't use the tic tac toe number sign or it does something to the type size, but in this case it's kinda nice since it makes my point)

Number 1 rule: the place you are getting credit from has to report to the credit bureaus or you are accomplishing nothing.

Xceler8x wrote: Don't use that site. They're scam artists. Use this instead to check your credit.

Is there anywhere that will give me a one-shot FICO score for free? I just went through your link there, requested and got a free Equifax report, but that didn't give me my FICO score. That's $8 extra.

I used that site about a year ago and hit up all 3 credit agencies. I remember getting a 3-digit score from each. They were all where I wanted them to be so I didn't worry about a single fico score.

carguy123 wrote:

Jensenman wrote: Something which has worked for friends in the past: go to a couple of those non-bank loan places (NOT the 'payday loan' people!) and take out, say, a $500 loan for 6 months from each place. Put the money in a savings account and pay it back on time each month. At the end of the loan period, you'll pay probably $40-$50 in interest on each loan, but you'll have a stable payback history.

The trouble is that most of those places don't report credit histories to the credit bureaus. (just found out you can't use the tic tac toe number sign or it does something to the type size, but in this case it's kinda nice since it makes my point) ###Number 1 rule: the place you are getting credit from has to report to the credit bureaus or you are accomplishing nothing.

Yeah, I left that part out. Many of the national chains do report to the credit bureaus, best to check with them first.

You say you "do not have a solid income" & $10,000.00 in student loans. Your "Dept to Income Ratio" is probably not too good. As you pay the loand down and make more money your credit score will improve

Xceler8x wrote: Don't use that site. They're scam artists. Use this instead to check your credit.

Only place approved by the DoD (for what it's worth...)

Don't get a report from all 3 companies at once, space them out.

Xceler8x wrote: I used that site about a year ago and hit up all 3 credit agencies. I remember getting a 3-digit score from each. They were all where I wanted them to be so I didn't worry about a single fico score.

Well, that's what I'm looking for - my 3-digit score. Equifax gave me my history and lots of details about what I've currently got going, but I never found the simple 3-digit score anywhere in what they showed me. It was just my credit report, not my 'score'.

I didn't go through the process for the other two bureaus yet.

And for GOD'S sake stay AWAY from CITI.

Check out Dave Ramsey. He is one of those debt free preachers. He has a lot to say about credit.

http://www.daveramsey.com/

He bought an office building in Brentwood, Tennessee for cash. I drove by it one day and I was impressed. Who needs credit?

Someone told me once that paying the amount due, in full, is not always the best way to build credit. Don't pay the minimum, but pay, say a $500 balance in at least 3 or 4 payments. Then you are showing that you can reliably pay your bills over time....tho paying off/down the college loans is going to go a long way to giving you a good score.

My parents have told me that paying cash for my last 2 cars may have hurt me, as the only other large loans I am paying are a mortgage of $700 a month and my credit card...that's used mainly for gas.

integraguy is right, they are looking for a stable payment history, not early payoffs. Here's the thing, from their POV: if you pay off early, it costs them interest income.

Actually you can have a stable payment history and pay off each month, that is if you charge some more each month.

The credit bureau doesn't care, nor can they see if you are making minimum payments or paying off each month. All they can see is how many months you have made payments and if they are on time.

And contrary to the David Ramseys of the world you need credit. If for nothing else so places will take your check. There are any number of places that require a credit history. For instance, if you want insurance they check your credit history even if you are paying cash for the insurance. No credit history or low scores due to no credit history may either cause you not to be able to get insurance or not to get a good price.

And if you ever want a car or house you better have a credit history.

the ramsey thing is to save and pay cash, I personally have no debt except mortgages and have since I was 20 (33 now) you can get a home loan with 20% down and manual underwriting with little to no actual dredit, as the house is their security, and no credit as way better than bad credit, for them or job or whatever, I have credit cards, I pay in full each month, I havn't financed a car or carried a ballance in 13 years and won't ever again

So where do you live until you save enough to pay cash for the home. You need the credit to get into the loop in the first place

evildky wrote: you can get a home loan with 20% down and manual underwriting with little to no actual dredit,

I call your bluff. Just try it. You won't find it with even 50% down.

There is no such thing as manual underwriting for any normal type home loans anymore. Now if you want to see your local loan shark and have 12%+ variable interest rate with a huge, short term balloon note then you might be able to do it, but you'll never be able to keep it.

As of this moment I don't even know where you'll find the loan shark. Do you have a rich uncle Harry? He might help, but don't count on it.

If you want a home loan of any type you will need a decent credit score. For years we've been able to use alternative credit to get people approved, but that presupposed a decent credit score in the first place. Now no or not enough credit gives you an extremely low credit score and that precludes any type of home mortgage loan.

Now a collateralized loan against assets worth more than the house will get you a credit card type of loan, but not a mortgage. That type of loan has nothing to do with buying a home, it is a loan to you based upon your huge savings account, other home - oh sorry, you don't have another home cause you don't have credit, hmmm, what else do you have with enough value that you can borrow against it to get enough $$$ to buy a house? Do you own a 70's convertible Hemi Cuda? That might do it.

Used to be you couldn't walk into a Sears without applying for their credit cards. That's how wifey and i got started. And it now just a regular MC. Home Depot has cards too.