Cable companies aren’t in the habit of reporting your payments to the credit bureaus, at least when it comes to your traditional credit reports. But if that’s something you want, there is a way to get those monthly bills to help your credit score.
Simply put, consider paying for cable with your credit card.
Unlike cable providers, credit card issuers do generally report to the major credit reporting agencies, so using your plastic to pay for a bill that you’re already in the habit of covering from month to month can help you build a payment history, the single biggest factor in establishing credit scores.
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Of course, for this strategy to work, you have to pay that credit card off on time and, ideally, in full. Otherwise, it will have the opposite effect on your score and you’ll wind up paying interest just to watch your favorite television shows.
To make sure you don’t miss a payment, sign up for alerts or, even, set your credit card bill to auto-pay. You could also pay the charge off via a linked debit card account as soon as it’s processed if you’re worried about winding up with a big balance (which could affect your credit utilization, another major factor of credit scores) at the end of the month.
A Few More Tips & Tricks
There’s a chance that your provider will charge a fee for paying by credit card, so be sure to check that there’s no extra charge before using this method. And, if you do set that credit card to auto-pay, monitor your monthly cable statements. You don’t want to miss a new fee or billing error and wind up paying more than you owe or intended.
Rewards credit cards can earn you some points, miles or cash back, so if you have one in your wallet, you might want to use that particular piece of plastic to pay your cable bill. If your credit is on the brink and you don’t have any credit cards, you can consider applying for (and then using) a secured credit card, which is designed specifically to help people build credit. (You can learn more about the best secured credit cards in America here.)
A Quick Reminder
Unpaid cable bills can damage your credit, even when they’re not being covered by a credit card. Accounts that go unpaid long enough can wind up in collections, which will hurt your scores. (You can see how any collections accounts may be affecting your credit by viewing your free credit score, updated every 14 days, on Credit.com.)
If your credit is in rough shape, due to an collection account or other payment history troubles, you may be able to improve your scores by paying delinquent accounts, addressing high credit card balances and disputing any errors that may be weighing them down. And remember, you can build good credit in the long term by making all loan payments on time, keeping debt levels low and adding to the mix of accounts you have, as your score and wallet can handle it.
More on Credit Reports & Credit Scores:
The Credit.com Credit Reports Learning Center
How to Get Your Free Annual Credit Report
How Credit Impacts Your Day-to-Day Life
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The post How to Use Your Cable Bill to Build Credit appeared first on Credit.com.
The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Lawâs editorial disclosure […]
Your credit
score can affect many aspects of your lifeâfrom getting a loan to getting a
job or getting a house. Good credit is necessary for sound finances and many
major purchases. But there are no quick fixes or shortcuts to building good
credit. You must start by establishing credit, then embrace responsible credit
habits over time. This helps you create a record that shows lenders you’re a
low risk and a desirable customer.
The following tips for building your credit help you understand and improve on the key factors that the three major credit bureaus use to calculate your credit score. By following these smart financial guidelines, you can demonstrate your credit worthiness. That makes you a more desirable customer and borrower for many businesses and lenders.
1. Review Your Credit Report
In order to build your credit, you have to understand it. Start by regularly reviewing your credit reports. You can request your free annual credit report from each of the three credit bureaus and assess your credit as it stands right now. Review the following:
Payment history
Amount of credit you’re using
Credit age
Mix of credit account types
Credit inquiries
Our free Credit Report Card can help you understand what is in your credit report and how those things affect your credit score. Our report card will help you identify areas that need improvement and help you make a plan to address these issues.
2. Dispute Errors and Inaccuracies
As you review your reports, keep an eye out for any errors. Credit report errors are not uncommon. In fact, a Fair Credit Reporting study found that one in four consumers found mistakes on their reports that can hurt their scores. You have the right to dispute those errors and fix your credit report. You can do credit repair on your own or hire a credit repair company to help you.
3. Keep Credit Accounts Open and In Good Standing
If you already have available credit, keep the accounts
open. Older credit accounts help assign a credit
age, which makes up 15% of your score. Closing an old account makes it look
like you didn’t start establishing credit until later, which can lower your
credit score.
And if you close a credit card, you also lose valuable
available credit for your utilization rate. It may be better to keep the card
open to support a lower debt-to-credit ratioâjust don’t run up the balance.
Make small purchases two to three times per year and pay them off during the
following billing cycle.
4. Make On-Time Payments
Making on-time payments is one of the most important
things you can do to build your credit. Your payment
history accounts for 35% of your credit score. It tells lenders and
potential employers how reliable you are. Missed payments are serious signs of
trouble. Charge offs and defaulted accounts say you can’t be trusted to repay
your debts as promised.
If you are newly establishing credit, avoid late payments
and other poor payment habits. This is one of the two most impactful factors
for building good credit. If you already have a poor payment history, commit to
changing now. Over time, those old payments will have less impact. Eventually,
they’ll even fall off your report.
5. Use a Maximum of 30% of the Credit Available to You
Ironically, lenders would rather not give you credit if
it looks like you need it or you like using it too much. That may seem
counterproductive, since they make their money off loan interest and fees. But
using too much of your available credit is a warning sign.
Maxing out your cards and lines of credit may point to
problems with spending, debt and income. That worries creditors, since it means
you may stop paying your loans. That’s why your utilization rate is a vital
part of your credit scoreâaccounting for 30% of the calculation in most scoring
models.
The most
desirable utilization rate is less than 10% of your available credit. At
most, keep it under 30%. If you make any large purchases on your revolving
credit accounts, pay them off as quickly as possible to keep your utilization
rate low.
6. Open Different Types of Credit Accounts
Having a mix of credit types is a good demonstration of
creditworthiness. This factor contributes 10% to your credit score. There are three
types of credit accounts to consider:
Revolving accountsâcredit cards and lines of credit. They have a credit limit and require regular payments.
Installment accountsâstudent loans, car loans, mortgages and personal loans. The lender provides a lump sum, and you make payments until the debt is paid off.
Open creditâcharge cards, utilities and cellphone services. With charge cards, you have a credit limit, and you can make purchases and cash advances, but you don’t carry a balance. With open credit accounts, you need to pay off your charges each month.
To build credit, work toward maintaining an account
from each of these categoriesâas long as you can afford them.
7. Open a Secured Line of Credit
It may be difficult to build credit if you haven’t
established a credit history yet. If you have poor or fair credit, it may also
be hard to get approval for traditional credit cards or loans. However, secured
lines of creditâlike secured
credit cards and secured
personal loansâcan help you get started on your path to good credit.
OpenSky® Secured Visa® Credit Card
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on Capital Bank’s secure website
Card Details
Intro Apr:
N/A
Ongoing Apr:
17.39% (variable)
Balance Transfer:
N/A
Annual Fee:
$35
Credit Needed:
Fair-Poor-Bad-No Credit
Snapshot of Card Features
No credit check necessary to apply. OpenSky believes in giving an opportunity to everyone.
The refundable* deposit you provide becomes your credit line limit on your Visa card. Choose it yourself, from as low as $200.
Build credit quickly. OpenSky reports to all 3 major credit bureaus.
99% of our customers who started without a credit score earned a credit score record with the credit bureaus in as little as 6 months.
We have a Facebook community of people just like you; there is a forum for shared experiences, and insights from others on our Facebook Fan page. (Search âOpenSky Cardâ in Facebook.)
OpenSky provides credit tips and a dedicated credit education page on our website to support you along the way.
*View our Cardholder Agreement located at the bottom of the application page for details of the card
Card Details +
To get a secure line of credit, you will need to put up
some form of collateralâusually cash, a savings account, or other personal
property. With this credit option, you may get a decent interest rate. The
lender’s risk is lowered due to your secured asset. This means they don’t need
to charge a much higher interest rate, as is common with poor credit.
8. Limit Credit Inquiries
Be careful when applying for new credit. You don’t want
more than two hard
inquiries every six months or so. Too many requests for credit can look bad
to potential lenders. These inquiries account for 10% of your score. Only apply
for credit if it can help improve your score through one of the methods
discussed above or is necessary for making a large purchase such as a home or
car.
When you do apply, comparison shop. Carefully weigh all
the terms and the chances that you will qualify for the card or loan on offer.
Then, choose only one or two and apply. If you’re turned down, don’t try again
for at least six months.
Build Your Credit
These personal tips can help you build credit and work on improving poor or fair credit. Building good credit habits can have a bit impact on your credit score. Start by signing up for Credit.comâs free Credit Report Card to get personalized advice for your unique credit situation.
Sign up for the Free Credit Report Card.
The post Tips for Building Your Credit appeared first on Credit.com.
What do you know about the 800 Club? Find out exactly what the 800 Club is, the benefits club members get and what you can do to become a member yourself.
If you love to shop, you can use your fashion sense to build or even rebuild your credit.
Store-branded credit cards are some of the easiest cards to qualify for and are often extended to those who have bad credit because they have lower criteria than traditional credit cards. Using them, especially if you’re loyal to a particular store, can bring card rewards, discounts and, if you pay your balance off every month, better credit.
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Immediate Savings
In most cases, when you apply for a card, the retailer will offer a discount on that dayâs purchase. Sometimes the discount will be extended to purchases made within a short time frame (24 hours, for example), as an incentive to spend more. The risk is that instead of saving money, you end up spending more than planned, so it’s wise to be wary.
Watch Your Credit Scores
When you open your new credit card, you may see a dip in your credit scores for two reasons: one, the inquiry created when the issuer checks your credit score, which may cause your scores to drop, though usually not more than a few points. Second, a new account with a balance is often seen as a risk factor. As long as you pay on time and keep your balances below 30% of your credit line, or ideally 10%, you could eventually see a slight rise because you’ll have a positive new credit reference, which is beneficial if you are trying to build or rebuild credit.
As you use your new card, you can track how your usage and payments are affecting your credit by signing up for Credit.com’s free credit report summary. In addition to getting two free credit scores, youâll get your own credit report card that shows how youâre doing in five key areas on your credit report that also determine your credit score â payment history, debt usage, credit age, account mix and inquiries.
Know the APR
Interest rates for department store credit cards are almost always high, often between 19% and 22%, or more. If you carry a balance, the interest you pay will likely exceed the amount you saved with the discount. This means carrying a balance could hamper your goals, especially if you fail to make on-time payments.
Given store credit cards’ high APRs, you won’t want to go on a shopping spree with them, nor will you want to put more purchases on the card than your budget can handle. (For tips on cutting back without feeling deprived, you can go here.)Â That said, making a couple of small purchases a month, say, on home essentials or groceries, and paying them off quickly (and on time) will likely beef up your credit.
Before You ApplyÂ
Before you fill out an application, you’ll want to know where your credit stands so you have a good sense of what type of card you might qualify for. Knowing your score will also inform your decision to apply for a card in general, as inquiries on your credit report can cause your score to take an unnecessary hit.
More on Credit Reports & Credit Scores:
The Credit.com Credit Reports Learning Center
Whatâs a Good Credit Score?
How to Get Your Free Annual Credit Report
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The post How to Use Your Shopping Addiction to Build Credit appeared first on Credit.com.
Good credit is essential if you hope to borrow money one day for things like a new car or home. But good credit can also be important for smaller things like renting an apartment or even landing a new job. And one of the easiest ways to build the credit necessary for these things is by getting a credit card.
If you have no credit, or even bad credit, and you’re averse to getting a secured credit card to help improve your credit, there are other ways to go about establishing and building good credit.
Here are three other options for building credit and improving your credit scores.
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1. Get a Credit-Builder Loan
A credit builder loan is a loan with a set amount you pay back over a set period of time (referred to as an installment loan). Most have repayment terms ranging from six months to 18 months, and because these loans are reported to one or more of the three national credit reporting agencies, on-time payments will help build up your credit.
Hereâs how it works: A lender places your loan into a savings account, which you canât touch until youâve paid it off in full, allowing you to build credit and savings at the same time. And because loan amounts for credit builder loans can be quite small (just $500) it can be much easier to make monthly loan payments.
Credit-builder loans are best for people with no credit or bad credit. But, if you have good credit but don’t have any installment accounts on your credit report, a credit-builder loan could potentially raise your score since account mix is another major credit-scoring factor.
2. Pay Your RentÂ
If you’re in the process of moving or need to do so in the near future, it’s a good idea to find a landlord who reports your rent payments to the major credit bureaus. Depending on what credit report or credit score is being used, these on-time monthly rent payments can give you a quick and easy credit reference and help you qualify for a loan (or at least another apartment down the road).
3. Become an Authorized User
Asking your spouse, partner or even your parent to add you onto one of their accounts as an authorized user could give your credit a boost. If the account they put you on has a perfect payment history and low balances, youâll likely get âcreditâ when that account starts appearing on your credit reports. You wonât necessarily need to use the card to benefit from this strategy. It is a good idea to have your friend or family member check with their issuer to be sure that it reports authorized users to the three major credit reporting agencies (not all do).
Remember, one of the most important things in building good credit is making timely loan and bill payments. Bills like rent or utilities may not be universally reported to the credit bureaus, but if they go unpaid long enough, they can hurt your credit, especially if they go into collection. (You can see how any collections accounts may be affecting your credit by viewing your two free credit scores, updated every 14 days, on Credit.com.)
If your credit is in rough shape, due to a collection account or other payment history troubles, you may be able to improve your scores by paying delinquent accounts, addressing high credit card balances and disputing any errors that may be weighing them down. And remember, you can build good credit in the long term by keeping debt levels low, making timely payments and adding to the mix of accounts you have as your score and wallet can handle it.
[Offer: If you need help fixing your credit, LexingtonLaw can help you meet your goals. Learn more about them here or call them at (844) 346-3296 for a free consultation.]
More on Credit Reports & Credit Scores:
The Credit.com Credit Reports Learning Center
How to Get Your Free Annual Credit Report
How Credit Impacts Your Day-to-Day Life
Image:Â Jacob Ammentorp Lund
The post I Don’t Need a Credit Card But Want to Build Credit. What Can I Do? appeared first on Credit.com.
