Bank Paying Habits

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As a retired banker I realize it has always more difficult to get a good credit rating started because you may have little or no credit or maybe some credit problems hanging around from your college days. This will give you an almost certain solution and help you start building some savings as well.

Many times first time car buyers or those people with little or no credit history (known in lending as "ghosts') find it difficult to make larger purchases without co-signors or high interest rate penalties. The lenders are always looking for a credit history that shows good consistent paying habits. Their criteria also weigh other factors too.

How long on your current job: Each lender has an idea of time but usually like 1 year or more.
Stability:
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This can also be gleaned from your personal references or their own personal knowledge.
Paying Habits: If you have any credit history, how was it rated.
Credit Score: Scoring agencies assign scores based on credit history that are considered heavily at times.
There are other factors considered also. You may have to clear any small outstanding collections first. If you are requesting secured loans such as an auto loans, new home, expensive furniture or office equipment, the amount of your loan request is weighed against the amount of cash you have to put down and the value of the item after you take it home. In other words, do you have an investment in this transaction that gives the lender confidence you are not looking for free ride and intend to stay the course? Other factors are usually unique to special situations and don't call for discussion here.

Let's look at someone who needs a credit rating and has little to show regarding the criteria listed above. I am going to share a solution that works with many banks and credit unions who will report your rating to all the right credit agencies. This is what you want to happen if the purpose is to get good credit
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You have a nice savings account that belongs completely to you.
Remember that credit is only a tool and should be used sensibly. Once you have a good credit rating, you will find credit card and other offers in your mailbox regularly. You would be wise to only use one at most and then try to get in the habit of clearing the balance every month to avoid interest charges altogether. A better alternative might be a debit card from your favorite lender with a small over limit allowance for emergencies. The lender you just paid off would be a great choice.

There is one last piece to the process. Check your credit score at least every six months. There are several free sites to do this and it will help you catch mistakes and let you your progress and standing.

I hope this helps on your quest to join the high credit score mob out there. If you have any questions I would be glad to try to answer them. My email is rj@covmacmarkeing.com. I will take the time to answer you.

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