Establishing Credit during the Recession

It has never been easy to build credit from scratch. If you have no credit history, you're likely to be turned down due to the lack of credit history. Now that lenders are holding onto their money, establishing credit may feel like a mission impossible. The question is, how to build credit during the recession?

There's no reason to wait for better economic times! Building credit is a time-consuming process and having no credit history can make things pretty hard for you. If you're about to rent your first apartment, you may have troubles getting the best deal, as landlords also review credit scores.

If you're just starting out your financial life, it makes sense to open a checking or savings account at a reputable bank that offers a wide range of products and services, including credit cards. Applying for secured cards issued by the bank where your money is kept, you are likely to be approved. Step by step, you can establish a good reputation with the bank as a reliable customer and then you will be able to consider unsecured credit card applications that require no money deposit and come with better terms and features.

Secured cards are probably the best option for those who want to start building their credit history from scratch. These cards come with no credit or income check, so that applicants are not likely to be rejected. Student credit cards are still available for youth folks. If you are a college student, you may consider some really good unsecured cards that require bad or no credit.

The bottom line is that you'd better be safe than sorry – take your time to do some research before applying for a credit card. Read carefully the terms and conditions of card agreements and choose the card that is right for you.