Credit Rejuvination-7

Credit rejuvination is similar to restoring an old house. You need to repair a few dings in the walls or woodwork and apply a fresh coat of paint. Some people need to build the house in the first place, starting with the foundation.

Credit Rejuvination is desired for three reasons:
1) starting fresh after a financial crisis
2) recovering from the “all debt is bad” mindset and
building credit
3) to remove derrogatory errors

You may have no credit history at all. Young readers in high school or college are just getting exposed to credit and their first experiences with debt. They don’t yet have a record with the credit bureaus.

Some readers may be well into their adult life and still have no credit. Consequently, you
must pay cash for everything. This is a classic profile of the person who has the “all debt is
bad” mindset. I often hear people say, “I have good credit, I’ve never bought anything on
credit.” Unfortunately, no credit score is just asbad as a poor credit score, and it’s often worse.
If you apply for a loan and have no credit history, the lender has to trust you enough to believe that you will pay it back. He has no references that support your creditworthiness.

Frequently, the ones who believe that any debt is bad debt have often encountered a financial hardship in the past. Inevitably, there is an unpaid medical bill or utility bill that appears on their credit report. This can create the worst credit of all. The poorest credit scores occur
when an individual who has not worked to develop any positive credit reporting accounts has one or two negative items on their credit report.

In many cases, having no score will mean you don’t meet the lending guidelines of the bank, disqualifying you for any loan. If you do get the loan, the lender is taking a huge risk and will charge you higher than prime market rate interest.

If you are over 25 years of age and have no previous credit history, thered flags will fly in the lender's mind. Where has this person been? Can he or she handle money? Is this a case of identity fraud? For lenders, in the business of lending credit, it’s hard to fathom that people are able to get through life without using credit—let alone prefeto live that way. They wonder what has changed to be presented with credit application now. To a lender the lack of credit use confuses them—and a confused mind says “no.”

The final section of this manual addresses these issues. You’ll learn the proven systems to build your credit and grow it to the credit wealthiness of a millionaire.

The good news is, if you have no credit yet, you need only to focus on developing a credit history, and doing so wisely.

Next time i'll discuss about perfect credit record.