I would like to get some advices how to build a good credit and why is it too important to have a good credit?

I heard a lot about good and bad credit and I want to know the important of that.I would like to get some advices how to build a good credit and why is it too important to have a good credit?
The reasons to have good credit are simple. If can affect you in literally hundreds of ways.





Good credit





- Lower interest rates for loans. Home, Car, etc.


- Qualify to by a home (FICO score)


- Employers check credit ratings


- Housing (Apartments) managers check credit before renting


- Setting up utility payments (no deposits)


- School loan rates can depend on your credit


- It can take YEARS to repair a bad credit history and in the meantime you can be denied credit or end up paying MUCH higher interest rates because of poor credit.





How do you build good credit?





- In many ways it is advantageous to have no (negative or positive) credit, because you can more quickly obtain new credit. For example, you can immediately enter most department stores and immediately open an account.





Department store cards can then lead to major credit cards, such as MasterCard, Visa, Discover or American Express. Do not go wild with these cards, however. Do not keep a balance past the grace period, so remember to pay off your balance each month. Remember that your goal is to establish a credit history and a strong credit grade. Maintaining a balance is actually a negative, albeit a minor drag on your grade.





You should try to limit yourself by maintaining only two department store cards and perhaps another two credit cards. Do not succumb to the credit card temptation.





Secured credit cards are a great way to establish a credit line whether you have no credit or damaged credit. Secured credit cards are regularly issued MasterCard or Visa credit cards, which are secured by a deposit.





To establish a secured credit account, for example, you would set up a deposit account with the issuing bank. The minimum could be as low as $100, depending on the bank.





You will then be issued a credit card, with a credit line normally equal to your deposit. In most cases, you will receive interest on the deposit account. However, if you ever default on your credit card, the bank can use your deposit to cover their losses.





It is also a good incentive to control your credit usage and minimize your balance.





But above all, DO NOT OVEREXTEND YOURSELF, PAY YOUR BILLS ON TIME AND AS CLOSE TO IN-FULL AS POSSIBLE. Avoid splurging and using the card when you can't afford to.I would like to get some advices how to build a good credit and why is it too important to have a good credit?
Unless you are planning to buy your own house with cash you are going to need good credit.
Having good credit will allow you to purchase homes, cars or other items that you want. Your good credit will show new lenders that you are honest and honor your word to pay them as agreed.





The 5 ';C's'; of Credit are:


character - How have you paid in the past?


capacity - Do you have a stable source of income?


credit - Have you had similar amounts of credit in the past?


collateral - Does the lender have a hard asset to cover the loan?


capital - Do you have a rainy day fund?





The more of these that are positive, the lower the risk for the new lender. This will give you both approvals and lower interest rates.
pay all of your bills on time. Nuff said
Its good that you are concerned with your credit a young age. Thats something that didnt concern me when I was young. And I payed for it big time.





Building good credit is easy. It doesnt event take getting a credit card. You can do something as simple as getting a small signature loan from your bank. ($500-$1000) What you do with that money is where common scence and good judgement come into play. If your just getting the loan to build credit, put it in the bank and DONT touch it. Make the monthly payments as normal. The more on time payments you have the higher your credit score gets. Another way to build credit is to get a secured credit card. You give the bank lets say $500-$1000. You then get a credit card (MC Visa etc..) Use it as normal. That $500-$1000 is their security that if you default or cant pay, the bank at least has there money. Of course theres the regular Credit Cards.





Mastercard, Visa, Amex, Discover all good cards but be careful as to how many you get and the amounts on each. I would also stay away from Gas cards and department store cards.





Your FICO score is probably as important as your SSN. Ranging anywhere from I think 350-850. This number is what any creditor uses to base their decision for credit. Good credit allows you to get the good APR when you go to buy a car, house and even Credit Cards. The median FICO score is around 720. Anything below 500 and your looking at bad APR or even no credit at all.