How do you use a credit card effectively to build history and score?

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    Stilt Team (Edited )

    Sometimes. You just need to be aware if these companies actually report to credit bureaus. Some of the services like Netflix may not do it. As their prices are not dependent on your credit history and you have to pay before you use the product.

    Any company that wants to pull your credit before offering you a product usually reports to the bureaus. Buying gas, groceries, and other things with a debit card won’t help. If you buy these things with your secured credit card and pay off the balance, it’ll be seen as good use of credit. You can choose to use only a portion of your credit limit, it will still count towards building your credit score.

    There are 5 major components of a credit score.

    1. Payment History - Based on a borrower’s payment history. This is the most important factor. Making regular payments on previous credit is very important. Try not to be late on your credit card and other credit payments.
    2. Credit Utilization - Make sure you don’t max out credit cards. It is important to maintain a good utilization rate (< 30% of your credit limits).
    3. Length of Credit History - It is important to show that you can consistently use credit responsibly that’s why you length of your oldest credit account is also matters.
    4. Credit Mix - Having different accounts and types credit accounts can show that you can manage different types of debts.
    5. New Credit - Low number of recent credit inquiries are important to show that you are not looking for credit all the time.

    About Stilt:

    Stilt provides loans to international students and working professionals in the U.S. (F-1, OPT, H-1B, O-1, L-1, TN visa holders) at rates lower than any other lender. Stilt is committed to helping immigrants build a better financial future.

    We take a holistic underwriting approach to determine your interest rates and make sure you get the lowest rate possible.

    Learn more about us on Wikipedia or visit us at https://www.stilt.co. If you have any questions, send us an email at team@stilt.co.

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