Now that we have gone through the pros and cons of credit, let’s start with the steps of building credit for the first time. You should view credit as a tool. It is just the way most people conduct their financial life to get the things they need, such as cars, homes furniture and appliance when they don’t want to use their cash or they don’t have the cash flow to purchase these items.
Step1. Apply for a secured credit card (a secured credit card uses your money which is placed in a security deposit account as collateral. The amount of money placed on your card is based on the amount of money in the account.
Step 2. Pay your balance in full every month and on time. (remember you are only using this card as an establishing tool, therefore you should only put a minimum amount on the card each month.)
Step 3. Apply for a secured loan ( a secured loan works the same as a secured credit card and if your payment are made on time each month and you are not late your credit score will increase.
Step 4. Apply for a credit builder loan (credit unions and some banks have credit builder loans to help you establish credit, check with your local financial institution)
Sign up to get your free credit report.@credit karma.com