Anonymous
Anonymous asked in Business & FinanceCredit · 2 months ago

Is there a way you can improve your credit with $1,000?

How does that work? Where you take out a loan and borrow your own money at a low interest rate? 

7 Answers

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  • 2 months ago

    Sure.  Just use that $1,000 to pay off some of the bad debt that is responsible for your bad credit and your situation will improve.  

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  • 2 months ago

    Yes, that is a credit builder loan. Borrow (say) $1100 against your own $1200 security pledge (in a 1 year CD), put the $1100 + 100 to cover interest expense in a money market account, and then have the bank (a credit union is better; lower interest spread) automatically draft out $100 a month, and you keep the small balance left at the end of the year and get your own $1200 plus interest back.  This will "thicken" your file (as it is a personal loan) which you started with a credit card.

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  • Judy
    Lv 7
    2 months ago

    get a secured credit card

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  • 2 months ago

    I think taking out a loan and then borrowing from it actually hurts your credit score. It's called something like "rotating accounts". For instance, if you take out a loan to pay off your car loan, it will ding your credit. 

    A good way to improve your credit is to get two credit cards, charge $5-$10 on each one each month, wait until it's reported that you owe the money, then pay it off. You have to wait until it's reported or the agencies don't see it. That will help boost your credit slowly over time.

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  • Anonymous
    2 months ago

    Sure.

    You can get a secured card. Pay on time for 9-15 months and they will return the $1000.

    Another option is a credit union secured loan. (also known as a credit builder loan) You borrow $1000 but do not get any money upfront. Then you pay monthly for 6-12 or 18 months and at the end, you get the $1000.

    Both are just forced savings but on your credit report, it looks just like a real loan or a real credit card.

    So either or both can help. But you are not going to trick someone into lending you $20k on a car despite no good full time job.

    building credit is a slow animal.

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  • Pearl
    Lv 7
    2 months ago

    i would talk to someone that deals with that about it

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  • 2 months ago

    That makes no sense.  Improving your credit score isn't that complicated.  Borrow some money and make payments on it over time, never miss a payment or make a late payment.  When the credit bureaus observe that you are trustworthy they will raise your credit score.  There is no quick fix for bad credit, you can't buy your way out of it.

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