How to Fix Unestablished Credit

Credit history is a critical part of an individual's financial life, and having unestablished credit can create problems. Buying a car, renting an apartment, qualifying for a mortgage and even employment can be affected by a low score due to unestablished credit. The best way to fix unestablished credit is to build a good credit history. This takes time and patience, but will give you a solid financial foundation.

Instructions

1

Open checking and savings accounts if you haven't already. Financial institutions look at how long you've had the accounts as an indication of your stability.

2

Pay all of your bills on time. Delinquencies on any of your bills eventually can end up on your credit report.

3

Apply for a credit card. Seek out cards targeted to those new to credit. They tend to have lower limits, so you'll need to be careful how much you charge, as one of things that affects your credit score is percentage of available credit. According to MSN Money, one guideline is to use no more than 30 percent of your available credit.

4

Apply for a store or gas station card, particularly if you were turned down for a credit card. These cards are easier to obtain but can have higher interest rates.

5

Apply for a secured card, especially if you've had trouble qualifying for a typical credit card. Secured cards are attached to a savings account, and the limit is usually equal to the amount deposited into the account. These accounts are easier to open and report to the three credit bureaus, which is essential to fixing unestablished credit.

6

Review your credit report annually at www.annualcreditreport.com and report any mistakes. It is important to make sure everything on your report is accurate.

7

Apply for an installment loan in the form of a car loan or other line of credit after you've had your card(s) for at least a year and maintained a clean credit history. This further establishes your credit and allows you to apply for other needed credit in the future.