Why is good credit important?
Your credit score is an extremely important part of your financial health and wealth growth. Having a good credit score is almost entirely necessary in order to support large life decisions such as buying a car or a house. With a low credit score you may find yourself paying more for debts such as credit cards and car loans and missing out on wealth building opportunities such as buying a home.
Building credit was a long and troublesome process for many years. However the rise of credit building apps has made it possible to build credit easily, cheaply and automatically. Many people see a credit score increase within 3 months, and many times changes are seen within 45 days. In the next section we'll cover what is expected in the best apps for building credit and how they work to improve your credit score.
How do credit building apps work?
Most credit building apps function by offering some variation of two products. A credit building loan, and a credit building card. These two products work to highlight the important factors that influence credit scores most, like credit utilization and payment history.
A credit building card can come in many forms, either as a secured credit card, an unsecured credit card with guidelines, or a credit card that works like a debit card. The best kind are the ones that report a high limit, and have guidelines to keep your utilization low.
A credit building loan can either come as a normal loan which usually has high interest, high fees, or low loan amounts or better yet they can be locked savings accounts.
Credit building savings accounts are the safest and cheapest way to build credit and have loan history. Instead of getting the money when you take out the loan, you save money in a locked account and get the money when the loan is paid off.
This way the lender can keep the money safe and offer this service without risking that the money will not be paid back. Because of this the service can be offered without a hard credit check, with little to no interest, and with little to no fees.
Over time these products help signal to the three credit bureaus that you are creditworthy and work to increase your credit score. All while streamlining the experience for the user and making it as easy as possible.
How to decide which credit builder app to use?
Price: The best credit building apps should have an affordable flat rate subscription price.
Features:
- Reporting to all three credit bureaus
- Start reporting in 30 days or less
- No hard inquiries
- Long term usability
- Should offer a credit building loan and card together on one platform
- Allow you to check your credit score and see what needs improvement
Things to look out for:
For apps that offer credit building savings accounts be careful to avoid credit building services that charge hidden fees.
Be sure to also avoid apps that charge you interest on your credit building savings account. Since the money is being locked away in a savings account and you are not getting the full amount until the end of the term, it is not fair to pay interest on the money and not get the full amount you've earned.
What are Ava's Products?
Ava Credit Builder Card
Build credit with low credit utilization and establish payment history.
- Fast approval upon completing registration, with no hard inquiry8
- Credit limit of up to $2,500
- Use the card to pay for online recurring subscription payments including Netflix, Spotify and more
- We report your progress to all three credit bureaus8
- The Ava Credit Builder Card features 0% APR
- No hidden fees
Save & Build Credit Account
Build credit while building your savings.
- Set aside as little as $259 per month in your locked Ava account
- Build credit and loan history with every on-time payment
- Access the full amount after completing the plan
- No interest taken from the total, and no hidden fees9
Rent & Utility Reporting
- Report your rent, utilities, and phone bills to build credit
- Add up to 24 months of past payments free with your Ava membership
- We never report missing rent, so only positive payment history gets reported
- Ava reports your payments to TransUnion. Reporting to Experian and Equifax is coming soon.
Credit score monitoring
Get access to your score and see what you can improve
- Check your credit score with updates as often as weekly
- Access insights into what's impacting your score
- Get notifications when you fall behind on payments
How do I get started?
To start building your credit with a credit building app, we recommend you download Ava.
Ava offers both a credit building card and a savings & credit builder account. All for a low monthly membership, no interest, no hidden fees and no hard inquiry.
To get started visit: meetava.com to see how you can begin building your credit today and see changes in as little as 45 days.1
