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How to Build Credit Fast: Simple Strategies

Why Your Credit Score Matters

A strong credit score is key to unlocking financial opportunities, whether you’re applying for a loan, renting an apartment, or even setting up a phone plan. But if you’re new to credit or need to rebuild your score, the process might seem confusing.

The good news is that there are simple ways to improve your credit fast. This guide breaks down the best way to build credit so you can get on the right track today.

How to Build Up Your Credit Score Quickly

Your credit score is a number that shows lenders how responsible you are with money. The higher your score, the more likely you are to get approved for loans and credit cards with better interest rates.

A good credit score can help you:

  • Get approved for loans and credit cards more easily
  • Qualify for lower interest rates (saving you money)
  • Secure rental housing or utilities without needing a large deposit

If you don’t have credit or need to rebuild it, don’t worry! You can take simple steps to improve your credit score quickly.

Building credit doesn’t have to be complicated. By using credit cards wisely, making payments on time, and keeping an eye on your credit report, you can improve your credit score fast.

1. Use a Credit Card the Right Way

One of the best ways to build credit is by using a credit card responsibly. If you don’t have one yet, consider applying for a secured credit card, which requires a deposit and is easier to get approved for.

Tips for building credit with a credit card
  • Pay your balance in full each month to avoid interest charges.
  • Always make payments on time—late payments can lower your score.
  • Keep your balance low (below 30% of your credit limit) to show responsible use.

2. Pay Bills on Time, Every Time

Your payment history is the biggest factor in your credit score. Late or missed payments can stay on your credit report for years, making it harder to get loans.

How to stay on top of your bills
  • Set up automatic payments for credit cards, phone bills, and utilities.
  • Use a calendar reminder to track due dates.
  • If you’re struggling, contact your lender—some may offer extensions or payment plans.

3. Keep Old Credit Accounts Open

Closing a credit account can lower your score, especially if it’s an older account. If possible, keep your oldest credit card open to show a long credit history. Even if you don’t use it often, keeping the account active can help your score.

4. Avoid Too Many Credit Applications

Each time you apply for a loan or credit card, the lender checks your credit report. Too many applications in a short time can lower your score.

What to do instead
  • Research the best credit options before applying.
  • Apply only for credit you truly need.
  • Use Speedy Cash’s location finder to find a store where you can discuss loan options in person.

5. Check Your Credit Report Regularly

Mistakes on your credit report can lower your score. In Canada, you can check your credit report for free with Equifax or TransUnion.

How to fix credit report errors
  • Get a copy of your report from both bureaus.
  • Look for incorrect late payments or accounts you don’t recognize.
  • Report errors to the credit bureau to have them corrected.

6. Become an Authorized User

If a family member or close friend has good credit, they can add you as an authorized user on their credit card. This allows you to benefit from their positive payment history, helping you build credit faster.

7. Use a Credit-Builder Loan

Some lenders offer credit-builder loans, which are designed to help people improve their credit. Instead of getting the money upfront, you make payments into a locked savings account. Once all payments are made, you get the money, and your payment history is reported to credit bureaus.

What to Avoid When Building Credit

While building credit, it’s crucial to be mindful of potential pitfalls that can negatively impact your credit score. These include:

  • Missing payments: Even a single missed payment can have a detrimental effect on your credit score. It signals to lenders that you may not be reliable in fulfilling your financial obligations.
  • Maxing out your credit card: High credit card balances relative to your credit limit can be perceived as risky behaviour by lenders. It suggests that you may be overextended financially and could struggle to make payments.
  • Applying for too much credit at once: Each credit application typically results in a hard inquiry on your credit report, which can temporarily lower your credit score. Applying for multiple credit accounts within a short period can make you appear desperate for credit and raise concerns about your financial stability.
  • Closing old credit accounts: While it may seem tempting to close unused credit cards, doing so can shorten your credit history and lower your average credit utilization rate, both of which can negatively affect your credit score.
  • Ignoring errors on your credit report: Errors on your credit report can unfairly lower your credit score. It’s important to regularly review your credit report and dispute any inaccuracies.

By avoiding these common mistakes and adopting responsible credit habits, you can build a strong credit history and achieve your financial goals. Remember, building good credit takes time and effort, but the rewards are well worth it.

Start Improving Your Credit Score Today

Building credit doesn’t have to be complicated. By using credit cards wisely, making payments on time, and keeping an eye on your credit report, you can improve your credit score fast. If you need a loan to help manage your finances while building credit, Speedy Cash can help you explore your options.

For more tips, check out this article on ways to improve your credit score. Building a strong credit score takes time, but with these simple strategies, you’ll be on your way to better financial opportunities!

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