If you have a bad credit history, or even no credit history at all, it is sometimes hard to get started building a good credit profile. Try this approach.
To work this plan you need at least $400 to begin, $1000 would be even better. For this example let's say is was $400. You should borrow this from friends or family if necessary. Then go to a bank of your choice and deposit the $400 into a regular passbook savings account.
Wait a few days for the account to be posted and return to the bank to ask for a loan equal to the amount of your deposit - you offer the passbook as collateral. Since the bank is already holding your $400, they should have no concern about lending it back to you with interest. They won't even make a credit check, because the loan is secured with your deposit. If any bank refuses to loan on these terms, close your account, color them stupid, and choose a different bank.
When bank number one loans you the $400, you go to another bank, open a savings account, return a few days later, borrow $400 from that bank using your new passbook as collateral. Then repeat the process at a third bank with your borrowed $400.
Wait a few days to go to a fourth bank where you open this time a CHECKING account with the $400 borrowed from bank number three. Wait a few days and make a payment on each of the other three loans. A week later, make payments again on the three loans, and continue paying each week until you have almost paid off the balance.
A credit investigation at this point will show you with three active bank loans (which are considered very hard to get), a checking account, and an excellent payment history for all three bank loans - with you having paid up in advance. Thus, you have AAA credit in as little as 30 days. From here you go on to apply for loans, credit cards, and other items on credit, but remember to go easy.
This approach will work using credit unions as well as banks. When you are applying for the loans make sure the bank or credit union reports regularly to the credit bureaus. Most do but you should ask to make sure. -Paul
