The key to rebuilding credit is using it and paying it back. The problem is, if you have bad or no credit, it can be hard to obtain new credit. Luckily, there are a number of helpful credit-building tools that are simple to obtain and can help you begin the credit rebuilding process.
Credit-Building Tools for those with Bad or No Credit
Whether you have bad credit that is holding you back in life, or have no credit history whatsoever, there is no time like the present to re-establish (or establish) your situation. These tools give you a chance to rebuild or build credit.
- A Secured Credit Card
With a secured card, you put your own money in a bank account and get a credit card with whatever amount you have deposited as the limit. Making on-time payments to your accounts is the best way to establish a good credit history, and this tool allows you to do just that. A good way to use a secured credit card is to only put one expense a month on it, then pay off the balance on time each billing cycle. Make sure that the card provider is reporting the payments to the major credit bureaus!
- Get a Credit Card with a Co-Signer or Become an Authorized User on One
If you try to obtain a regular credit card, you may need to get a co-signer if you have bad credit. They'll have to shoulder the responsibility of the card along with you. Or, you can try to find a family member or close friend who is willing to add you as an authorized user on their credit card. Becoming one gives you access to the card, but make sure to pay your share. Remember, at its core, credit building is about obtaining credit and paying it back, so you must be responsible with the cards and always make your payments on time.
- A Personal Loan
If you are facing high-interest debt, it may be cheaper to consolidate with a personal loan. This is a long-term debt-elimination plan where the goal is to get a lower interest rate to save money in the long run. A personal loan is still a form of debt, so it should only be used when it makes sense.
- A Special Finance Auto Loan
Bad credit auto loans are a perfect credit-building tool for those who need a vehicle. Special finance lenders know how to get you approved when it isn't possible with a traditional source. Do not try to use this type of loan to finance your dream car. They are designed to help those who need a vehicle but are held back by credit problems.
Getting a Bad Credit Auto Loan
Here at Drivers Lane, we specialize in helping people across the United States with bad credit find car loans, sometimes even for little or no money down. If you want a chance to rebuild your credit while getting the car you need at the same time, all you have to do is fill out our secure and easy online application. Start today!