What’s the problem with credit for most beginners? The fact that you need history to get the type of loan or financing you want.
Many creditors are wary of lending money to people with little credit experience. This can make it tough to get that car loan you need to have reliable transportation to work or school. Or it can make it impossible to get that mortgage for your first family home.
While the credit climb can be a slow one, one bureau recently announced a product to make it a little faster. It’s called Experian Boost, and as its name suggests, it can boost your credit score by using a different type of history in your favor.
What Is Experian Boost?
Experian knows that credit can be a crunch for novices. After all, how can you get credit and build a history if you need past evidence to convince banks you’re worthy of a loan? It can be hard to comprehend, but such is life when it comes to credit.
To make life easier, Experian’s Boost is a free product that lets you use cell phone and utility payments as part of your credit score calculation. Since most people have some history paying bills, Boost offers a way to build credit history quicker so you can receive loans and other financing more easily.
Is Experian Boost only for people who have no credit history at all? No, as it can also help those who are looking to increase their score after financial setbacks.
Every little bit helps, so if you’ve been paying your cell phone and utilities on time, it makes sense to include them in your credit calculation.
How many people could benefit from Boost? According to Experian, the product could help up to 100 million consumers achieve higher scores.
How to Start Using Experian Boost
To use Boost to increase your credit score, visit their official website, and sign up for the free membership. To make use of the product, you’ll need to give Experian permission to connect to your online bank accounts so they can perform scans for your transactions.
Each scan will look for cell phone and utility payments. Only positive payment history will be used. If you missed any payments, they will not be counted, unlike with regular credit history. In short, Boost cannot hurt your score.
Once the scans are complete, you will have to verify the data and confirm you want to use it to increase your score. After confirmation, Experian will send you an updated FICO score in real-time.
Can Experian Boost Work for You?
As mentioned, Experian estimates that 100 million consumers could use Boost to increase their credit score.
In the product’s first six months, two out of three Boost users saw an increase in their FICO scores. On average, scores rose 10-plus points, which was enough to help 13% of people transition into a higher credit band or range.