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Building Credit in a Pandemic

Credit is one of those things that we need, but never talk about. Most of us would feel weird asking someone about their credit score, or being asked about ours — it’s a taboo conversation. 





Even though the conversation is taboo, it’s crucial to learn and understand everything your credit impacts. Many major life purchases such as renting or buying a home, getting a loan, and even leasing a car, require credit. 


So, yes, we need credit for A LOT of things we do.


  • Renting 

It’s pretty much a guarantee that your credit will be pulled when you go about renting. Your credit will influence whether or not you get approved to rent, and can also influence the amount you pay.


  • Loans

When taking out a loan, your credit score is super important. It will determine whether or not you qualify for an Ioan, and the interest rate or perks that you receive on that loan.


  • Background Checks

Whether you’re getting a background check for employment, a professional license, or to rent/buy something, your credit will contribute to how “clean” your background check is. 


  • Cars 

Car loans and leasing work similar to loans in general. Your credit will influence the amount you can get approved for, as well as your interest rates. 



We recently spoke with Jon Reyerson, the private client portfolio manager at Jaguar Land Rover Minneapolis. He’s been selling cars for almost 20 years, and has quite a bit of expertise on how credit impacts going about purchasing or leasing a car. 


“It’s critical that you have good, established credit; because without that credit, you’re at the whim of the store telling you what you’re approved for versus dictating what you’re paying for.”


“We always want to have a an ‘in’ when buying something; a referral or one one who can walk us through the process, but having good, strong credit does the same thing for you. You can walk in not knowing anything about the process of buying a car, and with good credit you don’t HAVE to know anything. You’re afforded the best rates and opportunities because of your credit.” 


So how should you go about building your credit right now? 


Understanding how you can build credit right now can seem difficult. Even as our marketing team was discussing this blog, one of our own employees expressed some confusion around credit.


“I always knew what credit was and why it was important, but never gave it much thought. However, when I tried to apply to get my first credit card, I kept getting denied and usually the reason was lack of credit history. I then looked up how people acquire credit and when I tried to look up my own, and it turns out I had none. With no student loans or borrowed money, I didn't have credit even though I had been working, saving, and spending for years. I found myself confused and my parents were confused too. After talking with my bank, they recommended I open a secured card to help build my credit.”

This isn’t a one-off case. Many people get denied for things due to lack of credit history or poor credit history. So, let’s talk about how we can build up some credit, whether you have none or just need to give yours a boost. 



  • Secured Card

This is generally one of the first things your bank will tell you to do when you’re looking to build credit. Basically, you give your bank a certain amount of money, and this sum acts as your credit card limit. This allows the bank to feel secure that they’ll always have their money and helps build your credit.  


  • Certificate of Deposit

A Certificate of Deposit is a super easy way to build your credit. A Certificate of Deposit, otherwise known as a credit builder, is an agreement between you and your bank or credit union saying that you’ll pay a certain amount of money to them, over a certain time period. After the time period is up, they give you the money back. It’s almost like starting a savings account, except making the payments every month boosts your credit. The one downside of these is that you have to pay interest — but the interest is well worth it when you see that jump in your credit score. 




  • Pay Loans on Time

This may seem like a no brainer, but we have to reiterate it. On time payments have a very high impact in your credit health. If you’re having trouble staying on top of payments, try to set up a recurring or automatic payment plan so you don’t have to scramble to pay a bill the day it’s due. 


  • Have Multiple Accounts 

Contrary to popular opinion, having multiple accounts is a great way to build your credit; it shows that you are able to manage a variety of accounts responsibly. As long as you can manage the accounts you have open, it’s good to have multiple and to keep them open as long as possible. 


Building credit and understanding what your credit can do for you isn’t that tricky when you understand the basics. What steps will you take to level up your credit today?

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