I will describe a system I used to turn my dismal credit report into AAA credit in 6 months. My problem was that I had no credit. I was out of the country for 7 years and when I returned to the US, I promptly applied for a credit card, was rejected and was told that no history was worse than bad credit. I was ready to buy a house and car and needed all three reporting agencies to confirm I was and excellent risk.

So my research began. I phoned friends in the lending industry; searched the internet; read books on the subject and began to put together a step-by-step plan that would catapult my credit reports into the 80th percentile of those that hold credit.

I started off by calling up some friends in the lending business, by searching the internet, and by reading every book I could find. After that, I was able to concoct a plan that would eventually get my credit rating from zero to 80% higher than the other debtors in this country, and it only took me 8 months to do so.

To build up a good credit history, you need to get someone to extend you credit. It sounds backwards, but with some planning and some cash, you can make it work. You have to start by allowing interest to accrue on your loan, otherwise, the creditor isnat going to make any money if you pay your bills off before interest collects, and they wonat positively report you for being a good debtor unless theyare making money.

In the first credit union I opened a checking account with $10,000. I asked for a secured personal loan of $8,000 against my deposit. I explained that I needed to establish credit and they were happy to help. In each case used the free online banking to setup auto-pay the loan each and every month. I walked out of the bank with $8,000 in borrowed cash against my, now frozen, $10,000 deposit. As the loan is paid back, the funds are released from the bank.

Next, I went to another credit union with the $8,000, and opened another checking account. Once again, I asked for a personal loan of $7,000 against my $8,000, to help build up my credit rapport. I continued to do this at two more banks, until the last account held a $6,000 deposit, and I had $5,000 in hand.

I was a little nervous. In less than six hours I had used $10,000 to take out $26,000 in loans. Was this going to work? I felt like I had just setup a house of cards and that one wrong step and the whole thing would come crashing down. I knew that the only way I could really keep tabs on the whole operation was to trust the online banking to make all the payments for me. And it did. everything went great. Because I paid off all loans in under eight months, I created a record of being able to pay an enormous amount of money each month on debt.

In the end, I got $8,375 of my $10,000 back after all interest was paid. Each bank and credit union got a new customer and all got paid for their participation (the interest I paid to them). I, on the other hand, got a AAA credit report, four credit cards (two of which now carry a now $25,000 limit)

Tags: Credit Score