While apps like EarlySalary are always available to meet urgent, high-value cash demands, it’s still essential to focus on your credit score. A good credit score ensures that you’re able to acquire a quick loan based on your creditworthiness. Now let’s check out a few ways through which you can start building your credit score:
Getting a credit card is the easiest method for kick-starting your credit score journey. While getting a credit card is not rocket science, knowing a little bit about them can help you build a good credit score. There are primarily two types of credit cards that individuals can choose from – secured and unsecured.
An unsecured credit card is offered by banks based on your previous credit history. This likely eliminates the chances of an individual without a prior credit history on getting an unsecured credit card. But, if you have a stable stream of income, then you can still avail it. Here the proof of your steady income will testify the banks about your potential in clearing your credit card dues.
But if you are someone with both no credit history and stream of income, then there’s no need to worry. You can still get a secured credit card. A secured credit card is usually tied to collateral like an FD. So, by applying for a secured credit card you can start building your credit score.
But as a rule of caution, do change your credit card status from secured to unsecured at the earliest. A bank can misjudge you for being unreliable for credit as you own a secured credit card. So holding a secured credit card for long can have unintended results on your credit history.
While getting a credit card is easy and will start building your credit score payday loans in Bolivar TN, what you do with the credit card holds paramount importance. Each activity related to your credit card, right from usage to swiftness in paying the dues is monitored by credit bureaus who then formulate your credit score based on it. So, no second thoughts on how important it is to use your credit card smartly to boost your credit score. Plus, here’s a warning on getting too friendly with credit cards.
Also, little to no use of your credit card might look like a sensible option here. But it will still poorly impact your credit score. Therefore, it is advised to use your credit card once, in a while, Healthy usage favorably impacts your credit score. Let’s not forget that the goal here is to build the score, and not to destroy it.