How to Improve Your Credit Score as a Student


College is likely to be your first chance to develop a credit score. The choices you make now will have an effect on your life for years to come. For instance, by making smart choices, you’ll receive lower interest rates on loans, be approved for credit cards with better terms, and even find better housing after you graduate. There are several things you can do right now to improve your credit score.

1. Apply for a Secured Credit Card

If you have no credit history, it may be difficult to receive approval for a credit card. One solution is to take out a secured card. This type of credit card is connected to an account where you deposit funds. The amount you have in the account at any given time is the maximum limit on your card. You make payments just as you would a regular credit card — the funds in the account are purely for collateral. To improve your credit score, it’s important to always make payments on time and never to use the amount in your account. After a while, the creditor may even offer you an unsecured credit card.

2. Become an Authorized User on a Credit Card

An alternative to taking out a credit card yourself is to become an authorized user on someone else’s account. For instance, you could ask a close family member, such as a parent, grandparent, or older sibling. You’ll have your own card you can use to make purchases, but the primary account holder will be responsible for making payments. You should arrange to send your family member the funds to pay the balance separately.

To build credit in this way, it’s crucial the primary account holder always makes payments on time. A history of timely payments will appear in your own credit history.

3. Take Out Student Loans

Many students need loans to be able to pay for college. Although this will mean you have debt to pay after you graduate, it can have a positive effect on your credit score — provided you always pay the installments in full and on time.

It’s even better if you start making payments while you’re still in college. However, it’s still important to exhaust your other options first, such as by applying for scholarships and researching grants. This will help you avoid problems making loan payments.

4. Use Credit-Builder Loans

If you don’t need student loans, you could improve your credit score with credit-builder loans. This involves making monthly payments over a set period. At the end of the payment period, you’ll receive the amount you’ve paid (minus interest). The lender will report your payment history to the credit bureaus, helping you to improve your credit score.

5. Pay Your Rent on Time

Simply paying your rent on time can build your credit. You’ll need to ask your landlord to disclose your payment history to both of the credit bureaus to ensure your rent payments do form part of your credit score.

To be able to pay your rent on time each month, you need to find an affordable apartment. For Niagara student housing, look no further than Foundry Lofts. You can choose between a four- and five-bedroom apartment — whatever best matches your budget. Plus, all our apartments are fully furnished (including with in-suite laundry facilities) and rent includes high-speed internet. Apply now to secure the floor plan you want before they’re all sold out.

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