(SPEECH)
- Do you know how to build credit if you don't have credit?
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Logos, Navy Federal Credit Union, Making Cents. Text, How Can I Build My Credit?
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Here's the deal. When I applied for my first apartment by myself, I found out there was no data on me, no credit, literally nothing.
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Brian sits at a desk. The woman at the desk behind him turns and smiles.
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- He might as well have been a ghost. Did they call you Casper?
- Good one. Bryan here. I once had to build my credit from scratch. That's what my boy, Chris, is doing right now.
He's away at basic training. And he recently tried to open up his first credit card. And he found out he had no credit. Got me thinking, lots of people probably don't know how to build credit from scratch. And to some it may seem like a difficult task when you need credit to get credit.
- Listen up, because they don't teach this in Home Ec. Is Home Ec. still a thing?
- Doesn't matter. Here's how you can build it with these three smart money strategies.
(DESCRIPTION)
Text, Smart Money Strategy.
(SPEECH)
Apply for a secured card.
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Animated credit card paperwork appears.
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Creditors don't know if they can trust you with a line of credit yet. So you basically offer to make it safer for them.
You put up, let's say, $300.
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An animated bar fills up from 0 to $300.
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That money is held in a savings account and it serves as your line of credit. You can use it the same way you use any other credit card. And it's a great way to monitor your spending. After months of making regular on time payments and keeping your credit use low, typically under 30%, or in this case $90, some credit card companies may upgrade you to an unsecured credit card with a higher limit.
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An animation appears of two credit cards on an icon of two people.
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Get added as an authorized user on a family member's credit card. You'll have two choices. The family member who either trusts you a lot and gives you your own credit card with access to a credit limit that they set. Or you're an authorized user in name only.
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An animation of of an account page with two users appears.
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Either way, you have to trust that family member to maintain healthy credit habits. If they do, you can enjoy the benefit of your credit history growing.
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A dial representing a credit score moves from right to left to indicate falling credit.
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But if they don't, your credit can suffer along with theirs.
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A calendar and clock icon appears.
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And most importantly, make payments on time. Your repayment history is crucial to your credit score.
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Icons for credit card, mortgage and utility loans appear and animated bills move into them. Text, Make payments on time.
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Pay credit card companies, loans, utility bills, and other accounts on time for at least the minimum payment. Missed payments could lower your credit score quickly. Not great if you're trying to build it up.
(DESCRIPTION)
An icon representing a missed car payment appears and the credit dial moves to the left as an exclamation point appears beside it.
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So let's recap.
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A double arrow icon labeled Recap appears.
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You can apply for a secured credit card, become an authorized user, and make sure you pay your bills on time. With those simple steps you could be on your way to building up your credit so you no longer feel like a ghost. Now, how to find out why that person ghosted you? That's a discussion for another day.
(DESCRIPTION)
The woman at the desk behind Brian turns.
(SPEECH)
- Yeah, Bryan's still trying to figure that one out.
- Here's you and me MakingCents of your money together.
[AUDIO LOGO]
(DESCRIPTION)
Brian and the woman push their desks away in opposite directions.
Logos, Navy Federal Credit Union, Making Cents. Text, For more smart money tips, visit: navy federal dot org slash making cents. Insured by NCUA. This information is not legal or financial advice; instead, it is provided for general informational purposes only. You should consult your own attorney or financial advisor regarding your particular situation. The credit score and report you will receive through Mission: Credit Confidence Dashboard is a TransUnion credit report with a TransUnion Vantage 3 Score.
