you can pay in cash for practically everything, you still need to have some
credit (the ability to borrow money today to be repaid at a later date).
Lenders, employers, landlords and many others may review your credit report to judge your
New immigrants and high school students usually have no credit
because they have yet to establish it. Other people may have bad
credit histories (i.e., due to
bankruptcy). With no or bad credit history, it
can be hard to get a loan at a
good rate when you really need
Three Ways to Build or Reestablish Your
Apply for a secured credit card. A
secured credit card is a card that can be used as cash. It requires you
to deposit money into an account to secure the credit limit offered, meaning
if you fail to pay the bill, the lender can take the money from your
account. Remember to avoid fees by always making payments in full and on
Get a cosigner. Ask a relative or friend who
has good credit to cosign a loan. A cosigner shares responsibility for
the loan with you, and both of your credit histories will be impacted.
Remember to keep in mind that your cosigner is responsible to pay the debt if
you fail to pay.
Apply for gas cards or a department store credit
card. Gas cards and department store credit cards are relatively
easy to get because they usually offer low credit limits. After shopping
around for the best rates, apply for a gas or department store credit card and
use it to establish credit. Remember to pay your bill in full every
month to show that you can pay your bills responsibly.