The Basics of Building Credit

Is no credit the same as bad credit?

Person unsure of credit score A lot of people worry when they have no credit at all, assuming it is bad credit. That is not the case at all! Bad credit shows that you had a chance to pay on a loan or credit card and you didn’t do that. No credit simply says you haven’t had a chance to build your credit yet.

When you first become an adult, you will have no credit at all. Nevertheless, some companies will be willing to work with you to help you build your credit. If you miss payments on a regular basis, your credit score will be low. Then those same companies probably will not want to work with you.

What did we say about school again?

When you first start school, do you have bad grades? Of course not! You just don’t have any grades yet. As you go through the semester, you will work on assignments to hopefully get good grades. If you don’t complete your work after that, you will end up with a D or an F.

Credit works the same way. You have to have a chance to prove yourself before you get a bad score. If you haven’t started working on your credit, you don’t have bad credit just yet.