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The First 5 Steps To Build Your Credit

by Geoff McElhattan - Posted 2 years ago

The First 5 Steps to Build Your Credit.

  Team E-Z Auto in Fayetteville, NC, has a commitment to you, our customer. We want to help you with more than just your transportation needs and get you into a Quality Assured Vehicle. One of the many ways we assist you is in reporting to Equifax. Whether you have no credit or have a subprime (580-619 FICO) or ever lower score, here are the first 5 steps you should take on the road to financial freedom and responsibility. Learn more about Team E-Z Auto’s in-house financing options here. 

Before I go on, I want you, my reader, to know a couple of things. I am not a credit expert, but I can attest through my experience. I destroyed my credit score in my young adult years before I even knew what I was doing. I had a subprime score. I have since turned that around and enforced habits that continue to build my credit score. I am now at a place where I don’t dread people running my credit. I say this so that you know my story and are encouraged. It can be done. You just have to DO. Decide for yourself that you and your family deserve better! Accept responsibility, make a plan and take advantage of every opportunity you can. Building your credit takes time, but the sooner you take these 5 steps, the sooner your journey starts. 

1.Payoff Your Public Record Accounts.

Public Record accounts are typically judgments or tax liens. They weigh heavy on your credit. The main reason these are priority number one is due to how they are processed. Data for your auto loans and credit cards are sent monthly, and the credit bureau updates your balance. Public Record Accounts do not update with your payments as no one is pushing the data. These accounts are typically judgments or tax liens. These accounts are typically judgments or tax liens. For example, you may have a judgment of $5,000 that total amount will be reported against you until the judgment is paid in full, even if you have made payments and a balance of $1. 

2.Payoff Your Current Past Due Accounts.

People forget payments. We have all been there, but a late payment typically won’t affect your credit score unless you are over 30 days late. Payment history is exceptionally influential on credit score, accounting for up to approximately 35%. Any past due payments significantly affect your current score and will impact your score for some time. Call your credit lender and see if they will work with you. Remember, they are under no obligation, but it never hurts to ask and see what options are available to you.

3.Payoff Accounts that are in Collections.


I have seen tremendous results in my score and my life by doing everything listed here. It takes time, but it is well worth it. Start sooner rather than later. You’re worth it. Invest in yourself!  Team E-Z Auto thinks so. Collections are delinquent debts, and no attempt was made to pay. The lender then sold the debt to an agency that is trying to collect the debt. Collection agencies need you to pay off their debt. It is their whole business model. This gives you some power. Discuss with them and create a payment plan to pay off the debt. Ask the representative to work with you and reduce any fees, as collection agencies typically add fees and additional charges to the original debt. 

4. Make a Payment Plan for any current Credit Card Debt.

After you have paid off your extra debt, it’s time to build some habits. Develop a plan where you get your total credit utilization down to under 30%. [For example, for a car with a $300 limit, you want to stay under a balance of around $100.] Life happens, and sometimes you will have to go over that, but try not to exceed 30%. More than 30% of credit utilization begins to affect your credit score negatively. 

5.Start Building.

Now that you have seen to some of the issues pushing down your score, it is time to start building it up! Team E-Z Auto’s in-house financing allows you to drive and build your credit at the same time. As you make your monthly payments to Team E-Z Auto, you build a positive payment history. Unlike some used car dealerships in Fayetteville, Team E-Z Auto reports every 30 days to the credit bureau, so you can invest in a path to improve yourself. Another great option is a secured credit card. There are some excellent card options with Chase and Chime. They work with an initial deposit when you purchase the card. Then you pay off your charges every month to build payment history and expand your credit utilization. I recommend using this card as a gas card and just putting all of your fuel expenses and nothing else on it to make your payment manageable. You could also use it to pay your account with Team E-Z Auto. 

I have seen tremendous results in my score and my life by doing everything listed here. It takes time, but it is well worth it. Start sooner rather than later. You’re worth it. Invest in yourself!  Team E-Z Auto thinks so.


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