One of life's greatest catch-22s is the concept of credit. Suppose you have just graduated from high school and are interested in applying for your first credit card. After filling out the application form with all due diligence and patiently waiting for a response from the issuing bank, you are disappointed to learn that your request has been denied. Why? You do not have a history of credit.

But how exactly does one begin to build a credit history? You will, without a doubt, be issued a credit card. It's a tough nut to crack, but thankfully, building a credit history doesn't have to be difficult or costly. You can take a few simple actions that won't break the bank. This record includes information such as the number and types of credit accounts you have, the length of time each account has been open, the amounts owed, and the number of recent credit inquiries received from potential lenders. Establishing a credit history requires a beginning point for everyone, but it can be done. Here are the actions that need to be taken:

Review Your Credit Report

To begin, you should request a free copy of your credit report to verify that your claim of having no credit history is accurate. You may not believe you have a credit history until you find out that it was established because of a gym membership or a school loan. It can be all you need, even if it's just for a very little period. Your credit score is not included in your credit report in any way. If you want to know your score, some businesses will charge you. Still, you may obtain a rough estimate of it by utilizing one of the free credit score calculating programmes available online.

A Guide to Establishing Your Credit History

Unfortunately, these renowned remarks attributed to Johann Wolfgang von Goethe ring true in the field of credit reporting. Lenders want evidence that if they give you money, you won't take it and run, even though it may appear that having no credit is a good thing.

Get A Card Through Your Current Bank

Even though you may not have a credit score, the fact that you already have a checking account with a bank might be enough to get you accepted for a credit card. At the very least, you should check into being approved for a secured credit card. A secured credit card requires you to maintain a particular amount of money as a deposit, which is then used to determine your card's credit limit. Even if the credit limit on a secured credit card may not be extremely large, using one might help you establish a credit history for the first time.

Get Added As An Authorized User

Even though you could not have a creditworthiness, the fact that you already have a working account with a financial institution could be sufficient to have you accepted for a credit card. This will allow you to use their credit card without establishing your credit history. When you do this, you can take advantage of their responsible use of credit.

Apply For A Store Credit Card

The standards for acceptance of store credit cards, often issued by big stores, are typically laxer. These cards often come with an account-opening incentive, such as a discount of 10% on the first purchase you make with the card. Still, you may obtain a rough estimate of it by utilizing one of the free credit score calculating programmes available online.

Therefore, the next time you need to purchase anything from your preferred shop, give some thought to taking advantage of the business's credit card offer to assist you in establishing credit. Because the interest rates on shop credit cards are often rather high, you should be sure that you will have sufficient funds to pay the payment in its whole when it comes.

Finance A Store Purchase With An Interest-Free Offer

During the Christmas season, in particular, many businesses will allow you to buy products on credit with a "same as cash" deal that waives the interest penalty for a certain amount of time, often ninety days. If you make your payments on time, this kind of loan, which is a form of loan, may help you create excellent credit. Be careful to pay it off in full before the allocated term ends so that you may avoid incurring any interest or other costs that could be disguised.