Why do you need credit builder account(s)?
A credit builder account can help you improve your score in other ways than just payment history. Keep in mind the other parts of a credit score besides payment history: Amounts owed (30%), length of credit history (15%), new credit (10%), and types of credit used (10%). By using a credit builder account you are increasing "amounts owed" and diversifying "types of credit used."
Your credit history determines what loans you will qualify for and the interest rate you will pay. Lenders get your credit history by obtaining your credit score. You'll most likely need to borrow funds from a lender. This is why credit is such an important component to the home buying process.
Secured credit cards
Secured credit cards are a good resource to aid in building credit. It sounds odd but secured cards are actually easier to get than unsecured cards. That’s because secured cards require prepayment. For instance, if the applicant gets approved for a $500 line of credit, that person can deposit $500 with the credit card company in exchange for the $500 in credit. The secured cards on our site reports card activity to all three credit bureaus. This is how your score will increase. Listed below you will find 8 educational videos from our partners at Credit Builder U, these videos go in depth on why it is important to rebuild your credit with a secured credit card.
Installment loans are an opportunity to build trust. Installment loans have fixed monthly payment amounts and fixed monthly term lengths. They can help you build payment history. A good example of an installment loan is a credit builder line of credit. There are various companies on our site who offer this service. Check out Self Lender below: