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View Full Version : Short Term Quick Methods of Credit Rating Increase



AllGoNoShow
05-01-2006, 12:26 AM
Whats the best way to, on a short term (6 months), to build a stable credit rating.

I've heard a coupel of different methods...

1. Take out a small loan, pay it back quickly, through bank, then take out larger and do the same
2. Get a few credit cards, spend on them what yoou only have and pay them off early
3. Get steady payments taken out of your account for a few different things and proove the money is always there (Doesn't seem it would build quite as fas)

Any bankers/experienced people got any opinions or other ideas? This would be for a fresh 18 year old trying to quickly build something up.

gp36912
05-01-2006, 12:51 AM
:D i wanna know too, heres what i am thinking of doing, getting a credit card. then just spend it on gas and pay it off on time. etc.

max_boost
05-01-2006, 01:33 AM
It takes time to build up credit, can't be done in 6 months. Way too many factors go into building credit. You have to establish your credit file and it takes time.

For example, my credit rating 3 years ago was 684, today it is 765. All my vehicles have been purchased through loans, everytime I get a new car, it means a new loan, and the old loan gets paid off. I do this to build my credit higher. I have the cash to pay off the car but I rather leverage that and pimp out my portfolio. I have a steady job and on all my applications, I have provided only ONE employer. I might be over valuing it but I think that is crucial in your application.

Have you checked your credit rating yet? Might as well just pay the $22 and see it online at equifax.ca It'll tell you what you need to know and tips to improve things.

Why do you need to improve your credit so fast? ARe you trying to apply for something? If you are, guarantee you need a co-signor and a letter from your employer.

88CRXGUY
05-01-2006, 10:06 AM
^I agree with what he said. It does take alot of time to where to build your credit, it can't just be done over 6 months. The Credit Breau wants to see that they can trust you when it gives you money, 6 months ins't enough time. Do you think that 6 months is like a probation peroid and then boom they are going to give you 20 g's and expect you to pay it back, haha I don't think so.

I've had good credit with over the last 3 years that I have been gaining it and I still needed to get a co-signer for certain things (car etc). So if you are going to need something right now, better have a co-signer lined up...

If you can gain great credit in 6 months instead of 3 + years like the rest of us have, your pretty much shit out of luck. By slim chance that you can do it, comes and let his know...

AllGoNoShow
05-01-2006, 07:13 PM
The $22 would be a waste for me as it would show invalid ;)

Plan on getting are car co-signed but when I was talking to some of the places I am looking at dealing with, they say go for 6 months, build up credit so we can extend your pay period and get your payments down a little. Just going on their advice, insetad of jumping on a car with $700 a month payments because I want it, go for 6 months and bring it down.

Its not that I need to improve my credit, because it doesn't exsist, not 18 yet. Its that when I turn 18 I want to buidl it up before next spring.

Co-signer and Letter won't be an issue from what I can see right now, neither will monthly payments, I just want to get something there before I go in with no credit trying to buy something.

MIWYFSHOTTER
05-01-2006, 08:12 PM
there no such thing as short term quick methods. With no credit at all the bank won't even give you a small loan without a co-signer. Start with a credit card and work your way up. It takes time... a long time.

88CRXGUY
05-01-2006, 09:01 PM
He's not even 18 yet I dont think that they are going to give him a credit card. Since that he is under that age its going to be really hard for him/her to get some sort of credit. No company will sell you a car without a co-signer, due to the fact your under 18 and you don't have any credit.

AllGoNoShow
05-01-2006, 09:52 PM
Originally posted by 88CRXGUY
He's not even 18 yet I dont think that they are going to give him a credit card. Since that he is under that age its going to be really hard for him/her to get some sort of credit. No company will sell you a car without a co-signer, due to the fact your under 18 and you don't have any credit.

No shit... hence why I started this thread and there is that thing called 6 months? Fucking people these days, I'm not 18 RIGHT THIS INSTANT but when I do I want to build up credit quickly (within 6 months) to help out a LITTLE, never said I would be able to sign for a car myself or anthing myself, but something is better then nothing.

90s_tuner
05-01-2006, 10:13 PM
6 months is wayyy too short. Your best bet is to start with a credit card the day you turn 18. If you try and take out a small loan from the bank on your own they will deny you. When you turn 18 the CC will be your only choice. Pay that off each month nicely and eventually you will build from there.

4DoorGTZ
05-01-2006, 11:04 PM
I know you stated its for a car loan, but in another similar instance (getting a mortgage) getting credit cards/loans might not be helpful in the short term.... The AVAILIBLE credit is counted as debt, and the bank assumes you'll be making payments on it (even if its paid off and empty)

If you or someone else is in that situation pay them off then cancel them before you apply, it will allow you to qualify for a bit more. I had that problem as I keep 1 visa and 1 line of credit for emergencies..... Time to cancel them and use some savings for emergencies instead.

AllGoNoShow
05-01-2006, 11:41 PM
Thanks guys....


One more question... even if someone Co-signs for say a bank loan, if its paid off, does my credit still go up, or does theirs, or does anyones? I'm not all positive situations here, not missing payments or such, say 1 year loan is paid off within 6 months no problem, what happens with the signers and cosigners credit?

MIWYFSHOTTER
05-01-2006, 11:45 PM
Originally posted by AllGoNoShow
Thanks guys....


One more question... even if someone Co-signs for say a bank loan, if its paid off, does my credit still go up, or does theirs, or does anyones? I'm not all positive situations here, not missing payments or such, say 1 year loan is paid off within 6 months no problem, what happens with the signers and cosigners credit?

You both will benefit!

AllGoNoShow
05-01-2006, 11:48 PM
Thats what I like to hear. Much appreciated everyone:goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames: :goflames:

kaput
05-02-2006, 07:54 AM
.

AllGoNoShow
05-02-2006, 08:15 AM
I heard they no longer accept cell phone bills as credit?

MIWYFSHOTTER
05-02-2006, 08:26 AM
Cell phones can only give you bad credit (if you don't pay them). Its wierd.

Khyron
05-02-2006, 08:59 AM
I took out a 500 dollar loan when I was 16 and paid it back over 6 months. Do the same, maybe with 2000.

Khyron

benyl
05-02-2006, 09:33 AM
first of all, go talk to a bank.

Secondly, if you haven't already, get a SIN number.

Are you a student? If you are, you can get a credit card (even if you are under 18). Go look at the booths at the u of c. There should be pamplets there. They will give you a credit card even without a job. Probably will have a $500 limit. Get a sears card. Get an Esso gas card. You don't even have to use them and they "help" your credit rating.

Mckenzie
05-02-2006, 11:05 AM
Best Advice: RRSP loan.

Most banks will give you an on the spot RRSP loan into one of their mutual funds and they use that as collateral for the loan. The payments come out every month from your account.

This is how I started.....that is the advice the bank gave me when I was 17 and I have done it every year since.

Taking out a loan and paying it back right away tells the credit rating agency nothing about your ability to responsibly pay something back. Start with the above, then get a credit card when you are 18 and these two things will help you establish a great credit rating.

DONT:

-applying for store credit regularly
-applying for credit cards regularly

(these both hurt your rating)

benyl
05-02-2006, 11:11 AM
Originally posted by Mckenzie


DONT:

-applying for store credit regularly
-applying for credit cards regularly

(these both hurt your rating)

This is a myth.

You credit rating is not affected by the number of times you apply and get something. It is affected by the number of times you apply and get denied.

Banks look for multiple credit checks to see if you are "shopping" for a loan or if you are being denied credit elsewhere (i.e. car loan). If you are being denied, they will most likely deny you credit as well.

Mckenzie
05-02-2006, 11:24 AM
Originally posted by benyl


This is a myth.

You credit rating is not affected by the number of times you apply and get something. It is affected by the number of times you apply and get denied.

Banks look for multiple credit checks to see if you are "shopping" for a loan or if you are being denied credit elsewhere (i.e. car loan). If you are being denied, they will most likely deny you credit as well.

Banks refer to people who make regular applications as credit seekers. They see everytime you apply for credit through the agency and they do not like to see this. This is what I have been told by TD for years anyways...

benyl
05-02-2006, 11:27 AM
haha, you and I saying the same thing (kinda) but in different ways.

Mckenzie
05-02-2006, 11:34 AM
Originally posted by benyl
haha, you and I saying the same thing (kinda) but in different ways.

haha yeah I guess... :nut: either way too much availible credit poses a risk to potential lenders as it diminishes your ability to repay them with your given income and prioritize their payments over other creditors.

max_boost
05-02-2006, 11:38 AM
How about follow this one, don't apply for credit unless you need it. With that said, always have at least 1. :D

Xtrema
05-02-2006, 11:41 AM
Originally posted by benyl
This is a myth.

You credit rating is not affected by the number of times you apply and get something. It is affected by the number of times you apply and get denied.

It does to a point. I got a few store credit card in a short period of time to enjoy savings on stuff for the new house. Even all are approved, my credit rating drop a few point because of increased liability.

Only soft queries (like a credit report) doesn't affect ratings.

And of course, if you get denied, that's even worse.

That's why you should have a recent report in hand before trying for a loan.

AllGoNoShow
05-02-2006, 06:59 PM
My old bank wouldn't even talk to me until I was 18, switched to TD haven't brought it up yet with them but may try.

Have had a SIN since I was weeee-high.

Mckenzie, good idea about the RRSP stuff but I got a coupel of things....

1. My dad has been taking care of my investments and trust units since I was born, won't hand them over to me, won't tell me when he will.

2. Supposed to get RRSP dudections as well as company matched or something along those lines via work. Will kind of help but I know that takes awhile.



If you get a loan while your underage, it does nothing for your credit though, doesn't it? I heard if I got one when I was 17, paid off before I was 18, I will still start in the same slot, no matter what, no head start or anything.

s2k_boi
05-02-2006, 09:09 PM
can't apply for credit legally before age 18. we won't accept applications (bank wise)
refer to the previous posts... no quick ways to get a credit rating in the short term (maxboost) as it takes time.

AllGoNoShow
05-02-2006, 11:50 PM
so just a loan would mean nothing on my credit score until I turned 18? Or loan would have to be signed after I was 18?

cavb0i
05-03-2006, 12:28 AM
You turn 18 in Oct i assume follow these steps:

The day you turn 18, get a cibc classic student visa. they will give it to u guaranteed. Use it, pay it etc. later apply for a Student Mastercard down the road. i used bmo and no hassle there. Some people are going to say no, stick with just one but I did this exact thing and my score is just over 700 now which is really good for just a 1 year span! Keep the 2 cards, pay them nicely and you will prosper. with a 700 score i have no problems getting loans or nething the bank even calls me often to get a personal line of credit but i just dont need one.

AllGoNoShow
05-03-2006, 08:12 AM
Thanks cavb0i