How to Get Credit
Credit is a financial tool that's hard to live without in modern society, yet difficult to obtain after experiencing a bankruptcy, or for those with bad or no credit history. Learn how to get credit and afford what you want.
Up next in Credit & Credit Cards (16 videos)
Save money and stay out of debt with the advice in this Howcast video series about credit and credit cards.
You Will Need
- Credit type desired
- Credit sources
- Your credit report
- Your credit score
- Credit worthiness
Steps
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Step 1
Identify the type of credit needed
Identify the type of credit you need based on how you plan to use it. Options include a credit card, a line of credit, or a secured or unsecured installment loan.
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Step 2
Know the sources
Know the sources for different types of credit. Commercial banks, credit unions, consumer finance companies, or even pawnbrokers, offer credit opportunities. Match the source to your need.
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Credit unions loan to members and tend to offer interest rates lower than at banks.
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Step 3
Obtain your free credit report
Obtain your free credit report from one of the three major reporting companies, and learn your credit score to assess your credit worthiness.
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Step 4
Improve your credit score
Improve your credit score by paying bills on time, maintaining a checking and savings account, paying off debt, or piggybacking on a spouse's good credit.
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First-timers are able to begin a credit history when they open a checking and savings account.
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Step 5
Prove you are a good risk
Prove you are a good risk by showing stability as an employee, home owner, or renter, and the ability to comply with a creditor's standards.
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Step 6
Apply for credit
Apply for credit at the appropriate institution. If successful in getting a credit card or loan, protect it, and use the privilege wisely to better your financial plan.
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The Equal Credit Opportunity Act prohibits discrimination against applicants on the basis of race, color, religion, national origin, sex, marital status, or age.
