Your credit score— why do people make it out to seem like such a big, scary thing? Having great credit is ideal for buying a new car or getting approved for a house, but it is not something that we are born with. So how do you build credit? Well, your credit score is a combination of a few different variables: your payment history, your total amount owed, length of credit history, new credit, and the different types of credit. To build a strong credit score, you want to make all of these different variables work in your favor:
Payment History – Showing that you can continuously make payments towards your debt helps increase your credit score. This one is a double-edged sword because late or missed payments will cause your credit score to go down.
Amount Owed – maxing out your credit cards or exceeding the average credit limit shows banks that you take out money faster than you can pay it off. This is why Vola specializes is manageable microloans that college students can easily pay off without raising red flags.
Length of Credit – managing loans over extended periods of time shows banks that you are consistent in making payments and a responsible spender. This makes you a more attractive candidate for larger loans later on.
New Credit – Opening a credit account of any kind is the first way to get started on building a credit score. This is where Vola can help—download the app today and let’s get started building your credit with small manageable loans.
Different Type of Credit Used – Not all credit is built the same. Continuously paying on a bill in your name whether it is a phone bill, insurance, etc is one type of credit. Another is debt that is loaned to you that you pay back. For a stronger credit score, you want to show that you are reliable in different financial situations.
Vola can help you build a strong credit score by helping you show a history of taking out loans and completely paying them off. That is the magic of microloans they are easy to manage, and the Vola app makes it even easier. If you are ready to lay the foundation of a strong credit score, download the Vola app today!