Sunday, November 21, 2010

I am 20, paid off & cancelled all credit acct's, have bad credit, and can't get credit, any suggestions?

I am 20 years old, ran up a lot of credit with promotional cards not understanding how they worked and was very stupid. I have become a lot smarter with budgeting my money, but am not able to get credit anywhere to begin building credit. I have canceled all my credit accounts and am now looking to begin to rebuild which I now understand to be an even ';dumber'; move to make by cancelling all the accounts. I don't know what to do, I'm stuck without the ability to even rent an apartment and I have a good job that pays 70,000 a year salaried which I've been at for quite some time. I could really use any suggestions anyone has for how to help improve my credit score, while having bad credit, no credit lines, and no one will give me credit to let me prove myself!



Thank you in advance for all of your help.I am 20, paid off %26amp; cancelled all credit acct's, have bad credit, and can't get credit, any suggestions?
Go to your local bank and ask for a small line of credit - which can be as small as $500. Pay back that installment loan on time to help establish credit. Your rate may be higher because you have a previous negative credit history, but most banks are helpful at extending new lending opportunities.



Some banks will use a savings account as collateral for the line of credit, so you may need to open a savings account for the $500 as a buffer in case you were to default.I am 20, paid off %26amp; cancelled all credit acct's, have bad credit, and can't get credit, any suggestions?
J, try searching ';secured credit'; and see if you can find a bank, which offers secured credit cards. What essentially happens is that you are creating what begins as a pre-paid credit card, and then gradually increases to become more like a regular credit card over time.



You may deposit, say 200.00 and you will have a 200.00 credit line. This helps, when you have to provide credit cards to rent hotel rooms/rental cars, etc., and then still pay for the transaction in cash. Keep the credit limit small, and only purchase things on the card, when you know you have the money to pay for them in full at statement time.



You will build your credit slowly, using the card in this manner and, by keeping your credit line low, you can prevent yourself from going on a buying frenzy and running up interest and such later. You buy $100 pair of running shoes, you come home, write the check with the address from your last statement, drop it in the mail. That way, you're paid off already, and don't even have to wait for the bill to come.



Don't forget to read and re-read your interest levels and such,so you know what you're getting into.

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