How Credit Works

How to Start Building Credit

So you've made the decision to take control of your credit but you're not sure how to start building with a trusted lender?

Whether you have no credit history or are simply looking to strengthen your credit, there are two options almost anyone can use to start building credit and reduce debt. If you are wondering, “How can I start my credit building journey?” you are not alone. In this article, we are going to cover the different factors that influence your credit score and provide tips on how to avoid bad credit.

Secured credit cards

Secured credit cards work like normal credit cards, but they require a deposit up front to cover your debt in the event you don’t make your monthly payment.

However, there are a few things to understand about with these cards. If you have a bad payment history, your card issuer may not approve you for a line of credit. If you are unable to open a traditional credit card, you will need to find another option. Many are not open to someone who has a recent bankruptcy or foreclosure on their credit report. And many secured cards require a hard pull to your credit.

The Self Visa® Secured Credit Card, however, doesn't do a hard pull on your credit. And, since the only way to access this secured credit card is through the Self Credit Builder Account, you essentially split your security deposit up into several monthly payments.

Self Credit Builder Account

As your trusted lender, we enable you to make progress on the path toward excellent credit through our credit builder loan and credit builder credit card. Unlike a traditional credit card, the Self Credit Builder Account is like a savings plan that allows you to start building credit history (minus interest and fees). Imagine that someone gives you a loan, but you're forced to save it until the credit account is done; that's how the Credit Builder Account works.

Each month, you pay into your Credit Builder Account and we report your monthly payment to the three major credit bureaus, helping you build credit history and make progress toward a good credit score.

At the end of your credit account, you unlock your savings and the money inside is yours (minus interest and fees). This process makes it more likely that you are able to improve your credit rating through timely payments, allowing you to establish a good credit score in the future.

Read this guide for more ways to build your credit