Original Article By Ideal Credit
What are the best options for consumers to establish positive credit? Transactions and payment activity make up a third of the data used to calculate a person's credit scores. Typically, the bureaus prefer to see a variety of installment and revolving accounts to have a solid credit history. The following are some options clients have available to build positive credit.
Secured Credit Card
▪ Secured credit cards are specifically designed for clients with no previous or current history as well as consumers with low scores caused by negative items present on their credit report. Unlike prepaid or debit cards, all transactions will be reported to the major credit bureaus on a monthly basis.
Authorized User / Joint Account Member
▪ Clients with the luxury of having a family member or friend with good credit that is willing to help, can be added as an authorized user / joint account member which can potentially add years worth of payment and transaction history to their credit reports.
Reactivating Installments / Lines Of Credit
▪ Installments such as student loans that are currently in forbearance or deferment can be reactivated to gain previous history already established on their credit report.There may also be lines of credit that have not been used in a while that can be reactivated by doing a small purchase.
Payment History
Managing positive tradelines correctly can have a significant impact in improving your client's credit scores; however, every situation is unique and what works for one client may not work for the next.
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