Building Credit

I have been working on building my credit for over 2 years and I think it's finally paying off.

Two years ago I bought a car and financed it. I had a down payment of almost 30% and I still had a heck of a time finding a bank that would finance me! I have been paying on time on my car this entire time and it is only just barely starting to pay off.

When I got my car, the only credit card I qualified for was a secure one. I had to make a payment toward the collateral of my account in order to open a credit card. I was using the card to the max and paying it off in full every month. Little did I know this was NOT helping me. Apparently you only want to use 30% of your card every month and pay the entire balance. Since then, I have stopped using my card for purchases. Instead, I signed up with International Children's Fund and set up my donations to automatically come off of my credit card. That way, I know exactly how much will be on my card statement every month (although I still look it over), and I know that it is right around 30% of my limit.

About 6 months ago I was approved for a very high rated and very pricey credit card through a very high risk lender. I politely declined. They called, emailed, and sent letters every two weeks until the offer ran out. It was nice to be wanted, but I really didn't need their services. I had also applied at a couple of department stores because I heard it was easier to get approved through some stores than through banks. No luck.

Today I decided to try my luck at a department store credit card and I did get approved. And it is probably something I will use here and there so I decided to go with it.

I'm excited that I am able to get credit again, but I MUST SAY THIS: This is not a great way of CHECKING your credit because when you apply for credit it can LOOK BAD on your credit report. I was actively seeking credit at particular places as a way to begin building my credit which was a good plan for ME, but maybe (and probably) not you. The best way to fix your credit is to pay off your old balances. That was out of the way for me and so I needed to rebuild. Since I didn't have old cards to use (old accounts were charged off and closed) I needed new ones. Anyway, it is working for me and I am happy about it!