You may be confronted with one of life’s great contradictions: To get credit, you must have a credit history if you are trying to build credit.
We’ll show you the way to construct a credit score in a minute, but first let’s define how a three major credit reporting agencies, Experian, TransUnion and Equifax, view individuals who don’t use credit, or possibly have tried it maybe once or twice over a couple of years.
For those who have no credit history – never ever utilized a charge card, haven’t had a motor vehicle loan, never ever paid a home loan — you may be just what the credit reporting agencies make reference to as “credit hidden. ” For those who have sporadically used some kind of credit – probably a charge card, but possibly paid down a loan of some kind years ago – you may be considered “credit unscorable” since there is not sufficient information to create a credit history.
Interestingly, you can find 26 million Us americans whom fall in the” that is“invisible “unscorable” categories, which actually becomes a challenge if they are interested a motor vehicle or house and require a loan to do this. Loan providers will seek out a credit file and while there is no information (or restricted information), they treat you as you have bad credit. […]