A “credit ghost” is a consumer in search of a line of credit (loan) with no avail, mostly due to their lack of credit history which can tell a lender how that consumer will handle a loan.
If you have nothing on your credit report, you might be in a tough situation. Many consumers believe that living a “cash only” lifestyle is the best way to stay out of debt. However, never using your available credit to your advantage could be preventing you from getting the most out of your money.
A lack of credit history can prevent you from getting access to a line of credit, including:
- An auto loan
- Renting an apartment or home
- Getting approved for a mortgage
- Getting a low-interest credit card
All of the types of credit listed above will require some form of credit history. This is because the longer credit history you have, the more predictable your spending habits are to your lenders.
The Next Step
Just because you have no credit history now doesn’t mean you can’t start today! One of the most simple ways you can begin to build credit history is with a credit card. If you fear the almost limitless amounts of money a credit card provides, you can opt-in for a secured credit card. With a secured credit card, you provide a “deposit” upfront to the card provider and they will give you a credit limit that matches your deposit.
Getting an auto loan is another great way to boost your credit score. These loans are fixed, meaning that their rates never change and you pay the same amount each month. If you have a limited credit history, there is a chance you may be slapped with a higher than average interest rate and down payment. However, if your credit is limited, that may be the only options available.
If you are insistent on finding the best deal possible, working with a subprime auto lender may be the way to go. Subprime lenders are used to working with consumers who have limited or no credit. Making regular payments on any of these loans is a sure fire way to boost your score.
If you are looking to buy a new car but are in need of financing, CrediReady can help. Our nationwide network of trusted dealers and verified lenders work with buyers in all credit situations. Take a moment to fill out our free no-obligation loan inquiry form and start shopping for your dream car today!