Your Credit

Building a Good Record

The best way to maintain your credit standing is to repay all debts on time however, there may be complications. To protect your credit rating, you should learn how to correct mistakes and resolve misunderstandings.

When there's a problem, first try to deal directly with the creditor. Credit laws can help you settle your complaints without a hassle.

On your first attempt to get credit, you may face a common frustration: sometimes it seems you have to already have credit to get credit. Some creditors will look only at your salary and job and the other financial information that you put on the application. But most also want to know about your track record in handling credit, namely, how reliably you've repaid past debts. They turn to the records kept by credit bureaus or credit-reporting agencies, whose business is to collect, store, and report information about borrowers that is routinely supplied by many lenders. These records include the amount of credit you have received and how faithfully you've repaid.
Here are several ways you can begin to build a good credit history:



Open a checking account or a savings account or both. These do not begin your credit file but may be checked as evidence that you have money and know how to manage it.


Apply for a department store or gasoline credit card. Repaying credit card bills on time is a plus in credit histories.


Ask whether you may deposit funds with a financial institution to serve as collateral for a credit card; some institutions will issue a credit card with a credit limit usually no greater than the amount on deposit.


If you don't qualify on the basis of your own credit standing, you may consider asking someone to cosign your application.


If you're turned down, find out why and try to resolve any misunderstandings.


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