Need Help on Building Credit

[Deathmore]

Hi everyone, as some of you know I totaled my 2010 Camaro 2SS, and instead of jumping right into another one I am taking some forum members advice and building my credit for at least 6 Months. My Credit score is currently around 590s so I need to get it up a good bit in the next 6 months. I just applied for my first credit card and will see if I am excepted in the next few days. However I feel I should do more to help build my credit faster.

My First idea was to take out a small personal loan(around $2,000) and to just pay it off and eat the interest as I have absolutely no need for the actual loan.

My second idea which I think will help more is to open a secured credit card for a obserdly high amount(I was thinking at least $5,000). This way my credit report should show a high credit limit and very low usage percentage as once again I actually have no need for the credit. Plus this would help preventing me from just blowing the money on something stupid because it would be tied up in my secured credit card account.

So my question is are those ideas advisable, I personally feel like they should help. Unfortunately I really have no clue how credit works because I simply never needed it. Any suggestions would be appreciated.

[axis]

Lots of good tips on Google.

http://www.quickanddirtytips.com/mon...-fast?page=all

http://www.experian.com/credit-educa...dit-score.html

[jd10013]

not much you can do in 6 months. your credit score is basically the amount of risk to present to potential lenders based on your history of repaying people who've loaned your money. 6 months isn't a long enough window. in fact, paying off a 2k loan is worse than making the payments. lenders are more interested in seeing that you can make dozens of payments on time.

if you have a 590then there is obviously some bad stuff in there. paying off a single loan wont do much against it.

[skirush]

Originally Posted by tonyko1

Call Clark Howard or Dave Ramsey, this is a car forum, not credit forum.

Seems unnecessarily harsh. Are you the forum police?

That's the thing about online communication. Everyone is a tough guy when they are sitting behind a computer screen.

[MARINE1991]

Ok so did you not make payments on your car there's a lot missing here so you had a 40 k car and a 590 credit score

[Toms2010]

When was the last time you reviewed your credit report? Look for anything you may have paid off, anything over 7 years old. etc. Have them updated / removed. Are there things you really do owe and still have not paid?

Also, do not get a credit card now or a loan and pay it off. Not enough time to really do anything to your score before you get another car. A credit card only gives you a line of credit. which lenders will see as a possible negative due to it being new and open. This can have an adverse effect as their is no history on the card and looks like you are out to get as much dollars as you can.

Best thing, get your car. and in a few months after using it to establish payments and history. go to a local credit union and see what they can do to refinance.

I am not an expert. but I did help my wife rebuild her credit after a nasty divorce. Took a couple years and she now has a great score. Take any advise I give knowing I am not a financial expert. If bad enough. you may want to consult one.

[DaveA]

There is no quick fix. Creditboards.com is helpful if u want to try disputing stuff and getting it deleted. Time is your friend. Be patient, pay stuff on time, and don't max stuff out. From there your report will get better over time. I went through a divorce several years back that left me in tough shape financially. Only now am I over the hump and my credit is back up to 700. Just got a new Camaro with a great interest rate. I would recommend joining a credit union as they are more forgiving with credit issues.

[Scooter11]

Originally Posted by Toms2010

When was the last time you reviewed your credit report? Look for anything you may have paid off, anything over 7 years old. etc. Have them updated / removed. Are there things you really do owe and still have not paid?

Also, do not get a credit card now or a loan and pay it off. Not enough time to really do anything to your score before you get another car. A credit card only gives you a line of credit. which lenders will see as a possible negative due to it being new and open. This can have an adverse effect as their is no history on the card and looks like you are out to get as much dollars as you can.

Best thing, get your car. and in a few months after using it to establish payments and history. go to a local credit union and see what they can do to refinance.

I am not an expert. but I did help my wife rebuild her credit after a nasty divorce. Took a couple years and she now has a great score. Take any advise I give knowing I am not a financial expert. If bad enough. you may want to consult one.

Please Deathmore do not listen to his advice!!!!! You do not want to purchase your car with the hopes that you will be allowed to refinance in the near future. Way to risky and not worth it. Be patient wait until your score goes up to the point where you'll be approved for a loan that you'll be happy with.

[Scooter11]

Originally Posted by DaveA

There is no quick fix. Creditboards.com is helpful if u want to try disputing stuff and getting it deleted. Time is your friend. Be patient, pay stuff on time, and don't max stuff out. From there your report will get better over time. I went through a divorce several years back that left me in tough shape financially. Only now am I over the hump and my credit is back up to 700. Just got a new Camaro with a great interest rate. I would recommend joining a credit union as they are more forgiving with credit issues.

I agree with this!

Though if you do find a credit union that will accept you, make sure you do research first!

[Bonanza7]

I am a former SR VP of Lending in a large bank. Not much you can do to rebuild in 6 months. Rebuilding is a slow process, taking time, sometimes years. Small, dept store credit cards is a start. Bad credit stays with ou for a long time. Each application hits your score as a negative for awhile. Don't try applying everywhere. As was said earlier, a secured card will help, but take time. Don't be in a rush to buy a Camaro. They are not top priority. Building credit is. You don't have to be the top dog on the block for now.

[Toms2010]

Originally Posted by Scooter11

Please Deathmore do not listen to his advice!!!!! You do not want to purchase your car with the hopes that you will be allowed to refinance in the near future. Way to risky and not worth it. Be patient wait until your score goes up to the point where you'll be approved for a loan that you'll be happy with.

Ummm....he gave himself six months. Based on that time frame, what do you suggest he do?

[mikeyg36]

Originally Posted by skirush

Seems unnecessarily harsh. Are you the forum police?

That's the thing about online communication. Everyone is a tough guy when they are sitting behind a computer screen.

[mikeyg36]

Originally Posted by Scooter11

Please Deathmore do not listen to his advice!!!!! You do not want to purchase your car with the hopes that you will be allowed to refinance in the near future. Way to risky and not worth it. Be patient wait until your score goes up to the point where you'll be approved for a loan that you'll be happy with.

What's he supposed to do? Ride a bike for 2 years? If he has 6 months this is his only option.

[DaveA]

Originally Posted by mikeyg36

What's he supposed to do? Ride a bike for 2 years? If he has 6 months this is his only option.

Walk, bicycle or a beater. I have been driving beaters for 10+ years. Find someone local that does repairs out of their garage and you'll find maintenance isn't such a big deal.