How to Build Credit

A good credit score is the holy grail of not just vehicle loans but everything we do. Our focus will be on how to build credit with the idea of financing a vehicle but a good credit score can open so many different pathways previously unavailable. Most people, when getting a new vehicle, will need to take out a loan. Big or small, your chances of getting said loan to depend heavily on your credit history and score. If you have a bad history or score, you might get rejected, so boosting your score is paramount. With that in mind, we have some tips and suggestions below that should help you. As always, PA Credit King is here to help. If you have questions or concerns, don’t hesitate to reach out, we’d love to speak with you!

Building Good Credit

If you’re just starting out, we always recommend getting a secured credit card. Secured credit cards are backed by a deposit you have made upfront. In many cases, that deposit is the credit limit on your card. While not very flexible, the secured credit card route is a great way to start building a credit score so you can then apply for, and receive, regular credit cards with higher limits and better benefits. Another way is to be added as an authorized user on a family member or close friend’s card. That primary user’s credit payment history will be transferred to your credit history, giving you a built-in history of on-time payments, crucial to building a good credit score. You can always ask for a credit limit increase on any current cards you possess as well. Doing so will decrease your credit utilization ratio, common metric many score providers look at.

The Importance of Good Habits

Of course, the best way to improve your credit score is by the consistent application of good credit habits. It’s not glamorous or flashy, but it’s the only proven way to build good credit that lasts. The most obvious habit is always paying off your credit month by month or at least the minimum payment. Not only will this reinforce good spending habits, but you’ll also build a portfolio of reliable credit payments companies and loan providers can see. You also want to keep your credit card or other accounts open. Closing accounts might negatively affect some key metrics, so it’s something to consider very carefully; only close an account if you really need to. Another thing to avoid is the opening of many credit accounts closes together. Doing so can give off a spammy appearance that will negatively impact your score. Only open accounts you need to open and ones you’re confident you can consistently pay off.

Utilizing PA Credit King

As we mentioned above, if you ever have any questions or concerns, PA Credit King is an excellent resource! Our team has years of experience working with all kinds of credit, good and bad, so you’re in good hands with us. You can get approved online and can reach our finance team over the phone. Our rates are the best in the area and will compete with any other offer you might receive.