One of the most frustrating grown-up responsibilities is dealing with credit and credit scores. Unfortunately, it is important if you ever want to buy a car or have a mortgage in the future. If you don’t already have credit, it’s hard to get it; if you already have it, you probably don’t need it. The good news is that there are ways to establish positive credit and, over time, achieve high credit score marks.
When you join St Anne Credit Union in New Bedford, you begin with a primary Share Savings account. It is the basic requirement for membership. However, once you establish yourself as a member, you can open a Share Draft checking account, explore other savings and investment opportunities, and one day even apply for a car loan. The longer you are a member in good standing, the more options will come your way to help grow your money.
Why Credit is Important
You might think that no credit history is better than a bad credit history, but the truth is that they are about equal. If you don’t have any history, there’s no way for any lender or credit agency to know whether you have paid back loans in the past. This can make them hesitant about opening a new account or lending you money. Good credit can help you advance your possibilities in a few ways. The first is through borrowing. When you come to St Anne Credit Union in New Bedford for a loan, one of the things that we do is run your credit. All lenders use credit reports for loan approval. It gives us the opportunity to see your financial behavior and responsibility in the past and can allow you to become approved for increasingly large loans.
Other ways that your credit score is used to prove your “worthiness” is for renting a house or an apartment, applying for a job, and insurance. While most people know that their credit score is important for rentals, they might not be aware that many jobs and insurance companies use credit scores as well. Not every employer or position will require a credit check, but if you are applying for a job that is high-security or needs you to work with cash, a bad credit score could drop you down on the hiring list. Currently, auto insurance is the only personal insurance that can be impacted by your credit score. Of course, there is no connection between a bad credit score and your driving record or ability to work in a particular profession, but it is legal for businesses to use your credit score to evaluate your worthiness.
How to Build Credit
Whether you have an account with our credit union in New Bedford or if you are looking to join St Anne Credit Union, this is an excellent place to start. If you have no credit history whatsoever, it pays to open a Share Savings account and become a member. As you prove yourself each month by responsibly handling your financial matters, you are building a type of credit with St Anne Credit Union in New Bedford. This is true of any credit union or bank. When you apply for loans, one of the standard questions is whether you have a checking or savings account. Showing longevity with a financial institution like a credit union in New Bedford is a positive in your history.
The best way to build credit on a credit report is to open an account somewhere, borrow money, and make all of your payments on time. Credit card companies have lots of great options for individuals with no credit history that allow you to prove yourself. Often they will start off with a low amount and invite you to increase your borrowing amount over time. For example, a $300 VISA card with a reputable company could grow to a $350 or $400 card after six months of regular use and payments, but it could also increase much more significantly after a few years. If you are not approved for a traditional credit card, ask about secured card options. You would need to put a deposit down on the amount of the card, but it would be a chance for you to prove your commitment to borrowing and paying back funds each month.
Check Your Credit
Some credit card companies have free “credit score” options included with membership. However, there are also lots of other companies online that can help you stay on top of your credit score without appearing as a bunch of inquiries. Get your initial score and then take the advice of the credit company about making improvements. Some examples include paying more than the minimum amount, keeping your balances under one-third of the available credit amount, and never missing a single payment. With some work and time, you can start building your credit score in the first year.
Ready to get started? Visit St Anne Credit Union in New Bedford and open a Share Savings account. Our team can help you find some great tools that you can use to manage your money better when you join St Anne Credit Union. Call today at 508-993-0011 and speak with one of our agents about becoming a member of our credit union in New Bedford, MA.