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Credit Building


If you are wondering how to get good credit you will find these credit building tips very valuable.

Young people, students and women who have had little credit in their own name often find it difficult to get credit, especially credit at good interest rates.

(Read our other tips on how to get good credit here.)

With the basics in hand, this additional credit building information will increase your ability to develop a good credit rating.

Think Like A Lender

Lenders look at many factors when determining your credit worthiness. When you are building credit it is important to think like a lender and find out what they need from you to give you a good credit rating - then give it to them.

Show The Lenders Stability

Generally, lenders look for stability and responsibility. There are several ways to show both of these characteristics. Here are a few:

       Have a phone bill or other utility bills in your name.

       Ideally have accommodation in your name. That means your name on a rental agreement if your rent.

       A stable job record shows a potential lender that you are responsible and can hold down a job (which also means you have the ability to pay back your debts).

Do Your Homework And Avoid Rejection

Being officially rejected for credit several times can harm your credit record. Since you are in the midst of building credit, it is important to find out what the lender's requirements are before you make an official application. That way, if you don't qualify for credit with one lender, you can go to another without having triggered an official refusal of credit.

So phone ahead, ask questions about income and other requirements and read the fine print. And remember, just because a credit card offer comes in the mail, doesn't mean you will qualify.

Do Not Apply for Multiple Credit Cards!

When you are credit building it is important to take it a bit slow. Applying for several credit cards or loans over a short period of time will call into question your reliability and your ability to pay the debt you might develop.

The best approach is to apply for one card or loan, work at paying off the debt you create, then apply for another credit card at a later date. You will be building credit effectively that way.

Applying For Your First Loan

Applying for your first loan when you have little or no credit history behind you can be a bit tricky. It may almost seem like lenders are only willing to lend you money if you can prove you don't need it. Very frustrating.

You can increase your chance of qualifying for your first loan if you have a substantial down payment. Either save a little longer before you try to make that large purchase so you have a larger deposit or possibly approach a relative or friend to help you put together a large down payment. Remember to factor in paying back the down payment when you are calculating the amount of your debt payments.

Develop A Plan Of Action

Read over the credit building suggestions here and in our How to Get Good Credit Tips and develop your personal plan of action for credit building. Plan your approach and make sure you can offer lenders what they need in order to extend credit to you. It doesn't take long to plan and the results will be worth it - solid credit building.

If you have developed a bad credit rating, you can learn how to raise your credit score here.3 green arrows


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To achieve financial freedom, ideas such as: listening to good advice, learning how to make a budget, understanding credit repair possibilities, avoiding the scams, and generally becoming more knowledgeable of the credit card business, can all play a role in eliminating credit card and other debt. There is A smarter way to manage your money.



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