Before credit card companies approve a prospect’s credit application, they will utilize everything at their disposable to know their financial background first.


These include the prospect’s credit history and credit score.


Credit History


is the accumulated historical credit data that the credit reporting agencies gather to learn about the borrower’s credit background.


Credit Score


banks and credit card companies assess the likelihood of a prospective borrower to pay back a loan by calculating his/her credit score.


To help credit card companies to decide whether to approve or deny your credit application, they will initially analyze your credit history and credit score.


So how do you maintain good Credit History, and how will you increase your Credit Score WITHOUT being in debt?


Below are some ideas to get you started:


Be a responsible cardholder


Owning a credit card with no remaining balance if not the best— is one of the best ways to increase your credit score, without acquiring debt. With this, you can gain credit score by virtue of your low debt-to-credit proportion. Furthermore , you can get additional credit score by paying bills on time.


Also, it’s important to note that you may receive generous rewards when you open an account in a proper credit card company!


To cut a long story short, obtain a credit card, and be responsible for it.


Include rent payments in your credit file


Rent payments paid on schedule can help you to increase your credit score. Landlords can now report on how the tenants pay their rents through a consumer reporting agency called RentBureau.


Paying your rent on schedule is like effectively managing installments debts; thus, it shows that you are accountable and trustworthy.


So be a responsible tenant and pay your rent on time!


Be an authorized user with someone you can trust


When a credit cardholder open a credit card account, he usually has the choice to feature somebody else as an authorized user. Authorized user primarily indicates that a specific person has the power to use their credit card account.


Authorized users attain specific privileges such as making payments through that credit card account. Additionally, authorized users usually receive their cards with their names thereon.


One of the benefits of being an authorized user is—even though you are using someone else’s credit card, you’re not legally and financially liable for that credit account. On top of that, the records and transactions of that credit card—such as timely payments are typically included in your credit card report.


Essentially, it signifies that the status of that credit account will affect your credit score. Hence, it means that if the cardholder is responsible— it’ll reflect on your credit card report.


To summarize: you can passively increase your credit report as an authorized user, provided that the original cardholder is a good payer.