Hi all, I am sorry if this is a silly question. I keep reading about how you need a "healthy mix of credit". I want to build up my FICO score and I would like to find out what would be the best/easiest way to get some kind of installment loan in order to diversify my credit. I don't want to buy a car at this point ( I don't even know if I would qualify anyway) and I am not a student. What other small installment loans are there out there that I could hope to qualify for having a short credit history ? My equifax score is 647 and experian is 634. Should I try to get a computer on credit from a big store or something like that? Would that kind of loan be reported to the CRAs? Would it even be easy to get? Any other ideas of how to build credit apart from getting credit cards ? Thanks for your attention, I really appreciate the people who take the time to answer newbie questions like these ones. Ioan
One option that several people on the board have done, is to get a secured loan at your bank. Pay on it for about 6 months, then pay it off. I have never done this, but I'm sure someone else will respond on exactly how to do this.
Re: how to get any installment loan a loan secured with a certificate of deposit for example ? It's funny when you end up considering doing things that make no sense except to the FICO gods I would never put money in a CD and I would never borrow against that money but I will do it if it helps my score
Re: how to get any installment loan I think what LKH is referring to is a secured loan which is usually readily available at credit unions. You'll borrow against funds that are already in your account. If I were you I would take about three months to pay it back just to make sure it has time to be reported to the credit bureaus. Also, not every one reports so make sure you ask before you borrow the money if they report and to whom.
Re: how to get any installment loan Thanks for the advice. So, you think that 3 months is enough to have a considerable positive influence on the credit score if reported ? Ioan
Re: how to get any installment loan Getting a cell phone may help. College loans do to-that is if you plan on going.
Re: how to get any installment loan Hi Diane, I am confused about the cell phone issue. I have been thinking about it but I read some postings here that say that cell phone companies don't report. I guess what I should do is call each cell phone company and ask if they report before signing up. But they could always tell me later that they don't actually report. I am going to attend a school but it is not an accredited school and it doesn't participate in the federal student aid program so I am not sure what kind of student loans I could get by being student in this school.
Re: how to get any installment loan That's right...they don't report if you pay your bills on time, but if you don't pay it they will report.
Re: how to get any installment loan If you don't mind me asking, why are you attending a non-accredited school? My husband bought a computer from Gateway. He applied for a LOC from MBNA and was approved. They totally raped him at 21% but he paid on it for a year and a half on time every month and his scores are almost 800 now.
Re: how to get any installment loan What kind of credit history did he have when he applied for the LOC? What scores? I only have one credit card on my report, 1 year old and it is used at 89%. Do you think that a lot of the score increase came from that LOC ? Thanks for your answer, Ioan
Re: how to get any installment loan I have another question about this. Is it easier to get a LOC in this way than a credit card because the loan is considered as "secured" by the computer? I assume not. Or is it just easier because they really want you to buy their stuff and a LOC is less flexible than a regular credit card ? I checked gateway.com and I saw they have 2 options: and "easy pay" system and a credit card, both being funded by MBNA. I assume your husband applied for the easy pay option , right? Thanks,
Re: how to get any installment loan He did the easy pay. We never had a CC for it. Just a monthly statement. Before he got the LOC, he didn't have a lot of credit history. He only had 1 major CC at 90% and 1 store credit card at 60%. He also had a JC Penny card. All were never late. That was all the credit he had when he got the LOC. I don't know what his scores were at the time, but I can only say that as a result of that LOC that was always on-time and eventually paid off in full, he has a car and a harley on this CR plus store cards galore. He's managed to keep a healthy mix, so that's good. Wow, I wish I had his healthy credit lol
Re: how to get any installment loan Buy a new Dell PC online and get their in-house financing. That's what I did. They report to all three credit bureaus, although not regularly...about every six months or so to update your balance. Calmest_LA
Re: how to get any installment loan Thanks, what kind of scores and credit did you have when you bought it and how much did that LOC affect your score? what APR did you get ? I am somewhere between 630 and 650. thanks for the tip, Ioan
Re: how to get any installment loan I think that Dell pulls EX nationwide. They will give you a decent LOC with sub-par scores, but they will rape you on % rates. Charlie
Re: how to get any installment loan Thanks for the information. What is a decent LOC? 1000$ ? 2000$ ? Can you pay early on this kind of LOC?
Re: how to get any installment loan Not all secured loans with credit unions or banks will report to the cra's. Check with your institution first.
