Nowadays, credit (rating and history) is as almost as important as your Social security number or even your driver’s license. There are a lot of ways to build credit by means of a bank-issued credit or debit card, or another way is by taking out a loan and making good on the said loan. In this day and age building credit is important as most financial transactions these days are turning out to be cashless and as most of the commercial transactions are based on credit.
So the question would actually be how does one build credit? Or how to get a loan to improve one’s credit status? Here are some tips on how to get a loan and build credit.
- First, know what is your personal preference? Would you rather apply for a loan rather than having a credit card and if so, what kind of loan are you looking for? How to get a loan and what to use it for? A small loan would be a good place to start as to credit cards that are used in most commercial transactions it is easy to get lost in what you have already spent, your limit and how much you have to pay on a monthly basis. As against a small loan wherein the amount approved will be derived from the actual amount you can pay.
- Do not forget to ask questions. If you are already heart set in building credit through applying for a loan, then do not be afraid to ask questions as these questions will speed up processes on how to get a loan. As the borrower would know beforehand, his eligibility for a loan. The requirements needed, whatever materials or documents the financial institution or bank require its borrowers.
- Know your limitations and expectations. Always make a checklist of everything you need in acquiring a loan as to speed up the process, knowing what you need, and having them on hand before your application will always be a big factor. As well as having all the requirements from creditors if any, employers and other financial Institutions if needed. Know your limitations, including your personal credit history if you already have one. Based on your cash inflow you should know your financial limits and more importantly the repayments of the loan you can afford. If all goes well and borrowers have fully used themselves they would know exactly what to expect, as to the protocol in how long the duration of the loan approval and release will take. The specifics of the loan, the borrower’s goal on repayment of the loan and off-hand the chance of being denied the loan, there are still other options on how to build credit.