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How long does it take to build credit?

How long does it take to build credit?

  • I have a credit card with a small spending limit ($300) and have been using it and paying off the balance each month for about 3 months now. I recently have been trying to get a small personal loan and have been denied each time due to lack of credit. How long will it take me to get good enough credit to get even a small loan?

  • Answer:

    Sorry, but 3 mos is just not long enough to assess whether you are a good risk. Personal loans are the hardest to get. You have to have a decent income, credit score and longer history than 3 mos. Those inquiries that you intitiated by applying will now hurt your score. Don't expect to even be able to get a personal loan for a few YEARS. Usually, you need a couple years credit history, but, a personal loan is different as far as qualifications. Open an account at a credit union. Maybe in 18 mos to 2 years you could get a loan through them.

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It takes at least 2 years to establish any credit and 7 years to establish good credit. Small loans are a pitfall. Legit banks don't give these out as they don't really deal in personal loans under $10k and the places to DO give out small loans charge you TONS of interest that would make a loan shark blush.

Ryan M

That credit card does not even begin to count in your FICO score till at least the 6 month point. Even then, you won't have much score and your history will be considered very limited. It is unlikely that you could qualify for any kind of personal loan. Maybe at the one year mark, you MIGHT quailfy for a loan. It takes years to build good credit. You normally need at least 24 months of consistent, on time credit history to see any kind of decent score. But you will STILL only have a limited history if you only have one account.

bdancer222

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