by Kateryna Patskovska

Created on: October 28, 2009   Last Updated: October 29, 2009

How to build positive credit?

So you know how to fix errors on your credit report. Hmm...and you still cannot get a low percentage loan? Why? The answer is simple you need positive credit.

What is a positive credit? It's the credit that you acquire within 8 months and that shows on that pesky credit report from each of 3 credit unions. This positive credit history shows the creditors that after you have cleaned your credit report, to the best of your ability, you are ready to take on a responsibility of buying a car or getting a new credit card. This is when you will be much happier to be approved for a lower interest loan or have a credit card with a lower interest rate.

Let's look at the following steps:
One: you need to get a SECURED CREDIT CARD. This step helps you to start your positive credit. (Attention: different companies or banks that offer secured credit cards have their own fees and a minimum amount of how much you need to put on the card.) MAKE SURE THE SECURED CREDIT CARD THAT YOU GET REPORTS TO THE CREDIT UNIONS EVERY MONTH.

Second: Now there is a rule when it comes to staying in a safe zone with the creditors. This rule is: spend only 10% of your available credit every month. (10% ? That amount is too small. Yes it is and that is why you are in the safe zone of the creditors.) Note: if 10% is not good number for you, some creditors also consider maximum of 25% being in their safe zone.

Third: You need to pay the amount that you owe-every month. How much of the owed amount-you ask? All of the owed balance to the cents. This is important since this step shows to the creditors that you have available funds to repay the loaned or used credit amount.

Four: The duration for above mentioned steps needs to be no less than 7 or 8 months. This is an accepted and necessary time for credit companies to see how you handle your responsibilities when it comes to credit.

Of course for some people the process of building positive credit will take longer than for others. Do not worry. Whatever you do please do not give up. Patience is an important asset when it comes to dealing with credit issues.

Hope this advice will help. Good Luck!

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