You can work to improve your credit score in short order, but it takes more time to build a solid credit history. From keeping up with all of your monthly payments to keeping credit accounts open longer, we have some tips to help you build a credit history.

What it Means to Have a Credit History

Your credit history is just one piece of information lenders can gather from your credit reports. There are five different factors that make up your credit score, and lenders can see the information behind each of these on your credit report.

One of these factors is the length of your credit history. This, combined with your payment history (which is the biggest factor that makes up your credit score) gives lenders a good idea of your creditworthiness.

The length of time you’ve had credit for is important because lenders want to see that you are responsible with it, as well as how responsible you’ve been up to this point in your life. Once you’ve had credit for more than a year or two, and have a pattern of paying your bills on time – this is generally accepted as your credit history.

What else does it take to have a good credit history, though? Well, first, you need credit. Not one or two credit cards, or just student loans, either. You need to have a good mix of revolving credit accounts like credit cards, and installment credit accounts such as auto loans or mortgages.

If you don’t have all these things, its OK, but you should work toward adding both types into your file. A good way to do this is with a credit builder loan from your bank or credit union.

While it’s good to occasionally add a line of credit or an installment loan, opening a lot of them at once can be a red flag for lenders. This can signal that you’re in a financial crisis, just hoping for whatever kind of credit you can get.

Once you have a few credit cards and are paying them on time, another thing you should pay attention to is how much of your available credit you’re using. This is known as your credit utilization ratio.

Your credit utilization ratio is something lenders pay attention to. The less credit you’re using at any one time, the better. The rule of thumb is that your credit score is negatively impacted if your credit utilization ratio is over 30%. You can learn more about how to calculate your credit utilization ratio here.

Knowing Where to Build Your Credit

How Long Does it Take to Build a Credit History?A solid credit history is one of the top ways to improve your credit score, but there are other things you can do if you know why your credit looks the way it does. The first step in any credit building situation is to know what your credit score is and what’s on your credit reports.

Credit scores are often monitored by credit card companies and banks, and, if you have either or both, may be available to you free of charge through these institutions.

If this isn’t the case, there are other ways to stay on top of your credit score, such as paying for a credit monitoring service. You can also get your credit score for a small fee when you get your credit reports.

Credit reports are something you’re entitled to each year, thanks to the Fair Credit Reporting Act. By visiting, you can request a free copy of your reports once every 12 months from each major credit bureau: TransUnion, Experian, and Equifax. By monitoring your credit reports regularly, you can see which areas need the most help.

The five factors that impact your credit score and history are: payment history, credit utilization, length of credit history, new credit, and credit mix. By concentrating on the areas you need to improve on, you can begin building your credit without much strain.

Another thing you can do to easily help build your credit score is to make sure there’s no incorrect information on your credit reports. Disputing it and having it removed can raise your score.

Build Your Credit History with a Car Loan

Building credit history takes time, and a car loan is a great tool that can help. Auto loans are something that you have for a number of years, and each on-time payment you make helps you build a solid credit history.

If you’re dealing with low or no credit history, you may run into some issues finding financing for your current credit situation, but that doesn’t have to be the case with Auto Credit Express here to help. Special finance dealerships work with lenders that may be able to help, and we know where to find the dealers that have them.

If you want to get connected to one of the dealerships in your area with the lending resources you need, just fill out our easy, fast, and free car loan request form. Then, you can begin building your credit history with an auto loan ASAP!