Theory of building a credit rating
If you have no credit you need to create credit, you need a job and a goal to build a credit rating. You need to live below your means and bank 10% + of your income
Save $500 or so and find a good secured Visa that reports positive history. Make sure you get the right secured Visa. Some do not report to all the credit bureaus.
Use the Visa to get one credit card like Macy’s or Sears, and make a purchase and pay it off in full every month
Learn about credit utilization ratios and stay within those ratios to build a strong FICO score
All you need is a checking account, a savings account, and the secured Visa and one credit card to build a strong credit rating
If you have strong income, use $1000 with two banks
Bank number one, go to the bank manager and say you want a signature loan and create a CD for security or secured signature loan. Make sure it’s a major bank like Wells Fargo or Bank of America
With your collateral of $1000, they will give you a signature loan of $1000 over 12 months or so of about $80 payment a month
Take the thousand dollars that was loaned by bank one, go to bank two and do the same thing.
After 12 months you have to successfully paid off 2 installment loans reported to the credit bureaus which will help improve your Fico score of 100 points or so
Make sure you make payments 10 days or more before the due date of all accounts
Be disciplined. Be patient. Be consistent.