Many people think that to have a stellar credit score they need to earn a lot of money. However, this is nothing more than a myth. The reality is that you can have a moderate (even close to fair) source of income and still enjoy a credit score of 800 points. Amazed? Do not be. There is no trick up his sleeve. Here we will teach you how to improve your credit if you do not have enough income.
As you see, the main idea is to take care of the family economy, make financially responsible decisions, pay debts on time and not depend so much on approved cards and lines of credit. This would be more than enough to get a good credit score. Everything will depend on your patience and, of course, on your level of perseverance.
This is how even a person currently living on unemployment benefits, a recent college graduate, or a foreign national who arrived in the country in recent years can start building your credit to a stellar score that reflects your financial stability, even without a juicy salary.
This is perhaps one of the best ways to increase your credit without much effort. By losing a family member from adding you as an authorized user on their credit card, you can take advantage of their long payment history (assuming, of course, that your family member has had their card for a year or more) and use of your credit.
While the primary cardholder will still be responsible for making payments, you too could earn benefits and build your own credit with every action you take.
Tip: Remember to be financially responsible with the use of this card. It is preferable that you give it to your family member as soon as you receive it to avoid any problems. Also remember to try to choose a person who stands out for her financial responsibility and good credit. Think that, just as their good deeds benefit you, their bad deeds could take you to the bottom of the sea.
Tip #2. Apply for a secured credit card or a liquid collateral loan
It is possible that going to the bank and requesting a credit card or traditional personal loan is an odyssey for you because you do not have a sufficient credit score for the financial institution to consider you a good option. So the first step would be to stop asking for cards at the bank.. Remember that each time you do so, the institution will carry out a hard inquiry on your credit report and this will lower your score considerably.
So does that mean you can’t have a credit card? Not necessarily. You can opt for a starter credit card that will help you build your score. In this case, the bank or card issuer will ask you to leave a security deposit that would cover the limit of your new credit card. The good thing about this option is that, after a while of having the card and being punctual with your payments, the issuer or bank will offer you a standard credit card.
Note: You can do the same if you request a loan that reports payments to the country’s credit bureaus. In this section, MoneyLoan could be a good option.
Tip #3. Understand how debt rescheduling works for student loans and bills
If you took out student loans to pay for college, find out when the grace period ends so you don’t accidentally miss any payments. Start making payments as soon as possible and try to never fall behind. This is a great way to build your credit.
By reaching an agreement with your lender, you will not lose your credit score, quite the contrary. And it is that, in this case, the creditor will not report the delay or arrears of the student loan.
Note: This also applies to other loans. For example, MoneyLoan allows you to reschedule a payment as long as you give them advance notice. Note that credit card payment dates can also be rescheduled.
In short, how to improve your credit if you have no income
Remember that you don’t need to make a ton of money or have a five-figure income job to start improving your credit. There are three main steps you can take to increase your credit score quickly and easily:
- Become an authorized user on the credit card of a relative or trusted person.
- Request a guaranteed credit card or a loan that reports payments to the country’s credit bureaus.
- Understand how payment relief methods and debt rescheduling work on student loans and the like.
Tip: You can check your score and see how it is progressing by registering at Credit Sesame or opting for any of these options.
As you can see, maintaining and improving your credit score will not necessarily depend on your income. Rather it focuses on the way you make your financial decisions. As long as you are careful with the rate of use of credits, pay your debts on time and do not request financial products just to ask for them, it could be excellent.