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hawkz28

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Loan or credit card to build credit?
On this website it shows my credit score is being 648 and 649. My FICO score is 640. I have been with my job for 16 years and on our house, as well as our vehicles. Our credit got annihilated due to some medical bills that went into collections and garnishment a while after we bought our second house 5 years ago. My wife had several cards out and also had some accounts in joint names that I did not know she was not taking care of which destroyed our credit. We have been trying to rebuild our credit since.

I also own a small lawn care company. I am at a point where in order to grow my business, I need to upgrade my largest mower. Using the what if calculator on the website, it shows my score would improve more getting a credit card than a loan. Is that true in everybody else's experience? I don't want to screw us in the future when we go to get a loan for a new vehicle, we're planning on doing in the next 12 months. I would also like to build our score as high as possible before that point.

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First, do not trust the calculator, but if you do not have any open accounts in good standing, then yes, getting a credit card will help you, don't apply for anything great, you don't want to be denied and waste a Hard Inquiry, check the websites of credit card companies for preapprovals. Maybe a basic platinum card or even Secured card from Capital One. Don't try to appease the Vantage scoring system, work to appease FICO as that is what most lenders use. You would be fine to do this now and really need to, if you are not going for major financing for a year. You really need to dedicate an hour a day for the next month or two reading all that you can find about credit.

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