{"id":28165,"date":"2026-04-30T17:20:33","date_gmt":"2026-04-30T15:20:33","guid":{"rendered":"https:\/\/miuniversity.edu\/blog\/what-is-the-best-way-to-build-credit-tips-and-common-mistakes-to-avoid\/"},"modified":"2026-04-30T17:59:27","modified_gmt":"2026-04-30T15:59:27","slug":"the-best-way-to-build-credit","status":"publish","type":"post","link":"https:\/\/miuniversity.edu\/en\/blog\/the-best-way-to-build-credit\/","title":{"rendered":"What is the Best Way to Build Credit? Tips and Common Mistakes to Avoid"},"content":{"rendered":"<section id=\"hero-post\" class=\"hero-post\">\n  <picture class=\"hero-post__bg\">\n    <!-- tatamiento horizontal -->\n    <source media=\"(orientation: landscape) and (min-width: 1024px)\" srcset=\"https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/iStock-1449816549-scaled.jpg\">\n    <!-- tatamiento vertical -->\n    <img decoding=\"async\" class=\"hero-post__img\" src=\"https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/iStock-1449816549-scaled.jpg\" alt=\",\" title=\"\">\n    <noscript>\n      <img decoding=\"async\" src=\"https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/iStock-1449816549-scaled.jpg\" alt=\",\" title=\"\">\n    <\/noscript>\n  <\/picture>\n  <div id=\"breadcrumbs\" class=\"breadcrumbs\">\n    <p class=\"container\">\n      <span>\n        <span>\n          <a href=\"https:\/\/miuniversity.edu\/en\/\" data-gtm-container=\"breadcrumb\" data-gtm-action=\"navigation\">\n            Home          <\/a>\n        <\/span>\n        &gt;\n        <span class=\"breadcrumb_last\" aria-current=\"page\">\n          <strong>What is the Best Way to Build Credit? Tips and Common Mistakes to Avoid<\/strong>\n        <\/span>\n      <\/span>\n    <\/p>\n  <\/div>\n  <h1 class=\"hero-post__title\">\n    What is the Best Way to Build Credit? Tips and Common Mistakes to Avoid  <\/h1>\n      <div class=\"hero-post__wysiwyg\">\n      Building a solid financial foundation in the United States begins with understanding your credit profile. The best way to build credit involves a combination of opening the right accounts and maintaining a consistent history of on-time payments. By managing your credit utilization and avoiding common pitfalls, you can establish a high credit score for better interest rates and financial opportunities. Gain the expertise to manage complex financial landscapes by studying an MBA at MIU City University Miami.       <\/div>\n  <\/section>\n\n\n<h2 class=\"wp-block-heading\">What is credit and why is it important in the U.S.?<\/h2>\n\n\n\n<p>In the United States, credit is a measure of your reliability as a borrower. It is tracked by three major bureaus \u2014 Equifax, Experian, and TransUnion \u2014 which compile your financial behavior into a <a href=\"https:\/\/www.myfico.com\/credit-education\/whats-in-your-credit-score\" target=\"_blank\" rel=\"noopener\">FICO Score.<\/a> <\/p>\n\n\n\n<p>Your credit history impacts your ability to rent an apartment, secure a loan, or obtain a mortgage with favorable interest rates. For aspiring professionals and entrepreneurs, credit is the gatekeeper to capital. Without it, scaling a project or investing in your future becomes significantly more expensive.<br> <\/p>\n\n\n\n<p>Si eres un profesional o emprendedor, <strong>el cr\u00e9dito es clave para obtener capital<\/strong>. Sin un buen puntaje, hacer crecer un proyecto o invertir en tu futuro ser\u00e1 mucho m\u00e1s dif\u00edcil y caro. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">The best way to start building credit from scratch<\/h2>\n\n\n\n<p>For those with no prior history, the best way to start building credit is through entry-level financial products designed for thin-file borrowers.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Secured credit cards: These require a cash deposit that serves as your credit limit. They are easier to obtain than traditional cards and report to the major bureaus. <\/li>\n\n\n\n<li>Credit-builder loans: Offered by institutions like Self Financial or local credit unions, these loans hold the borrowed amount in a bank account while you make payments, reporting each one as positive activity. <\/li>\n\n\n\n<li>Becoming an authorized user: If a family member has a long-standing account in good standing, being added as an authorized user can allow their positive history to reflect on your report.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Tips to build credit score over time<\/h2>\n\n\n\n<p>Once you have established an account, the focus shifts to optimization. What is the best way to build credit score results that last? Consistency is the primary driver.  <\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Payment history (35% of score): This is the most critical factor. Set up autopay to ensure you never miss a deadline. <\/li>\n\n\n\n<li>Credit utilization (30% of score): Keep your balances low relative to your limits. Financial experts at the Consumer Financial Protection Bureau (CFPB) recommend keeping utilization below 30%. <\/li>\n\n\n\n<li>Length of credit history: Avoid closing your oldest accounts, as the age of your accounts contributes to your score&#8217;s maturity.<\/li>\n\n\n\n<li>Best way to build business credit: If you are an entrepreneur, apply for a Federal Tax ID Number (EIN) and open a business bank account to separate personal and professional liabilities.<\/li>\n<\/ol>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"683\" src=\"https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/shutterstock_2707124475-1024x683.jpg\" alt=\",\" class=\"wp-image-28150\" title=\"\" srcset=\"https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/shutterstock_2707124475-1024x683.jpg 1024w, https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/shutterstock_2707124475-300x200.jpg 300w, https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/shutterstock_2707124475-768x512.jpg 768w, https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/shutterstock_2707124475-1536x1024.jpg 1536w, https:\/\/miuniversity.edu\/wp-content\/uploads\/2026\/04\/shutterstock_2707124475-2048x1365.jpg 2048w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">5 common mistakes to avoid when building credit <\/h2>\n\n\n\n<p>Many people inadvertently damage their progress by falling into these common traps:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Applying for too many accounts at once<\/li>\n<\/ol>\n\n\n\n<p>One of the most frequent mistakes is applying for too many credit cards or loans in a short period. While a single inquiry might only dip your score by a few points, multiple inquiries within a few months signal to lenders that you may be in a desperate financial position or taking on more debt than you can handle. To protect your score, space out your applications by at least six months.  <\/p>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li>Co-signing a loan<\/li>\n<\/ol>\n\n\n\n<p>Co-signing a loan for a friend or family member is often seen as a helpful gesture, but it is a significant credit risk. As a co-signer, you are legally responsible for the entire debt. If the primary borrower misses a payment or defaults, that negative information appears on your credit report immediately. Furthermore, the total balance of that loan counts toward your debt-to-income ratio, which could prevent you from qualifying for your own loans in the future.  <\/p>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li>Closing old accounts<\/li>\n<\/ol>\n\n\n\n<p>Closing your first credit card might seem like good financial spring cleaning, but it actually shortens your average age of accounts, which can lower your score.<\/p>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li>Paying only the minimum<\/li>\n<\/ol>\n\n\n\n<p>While this keeps your account in good standing, it leads to high interest charges and high credit utilization, which accounts for 30% of your FICO Score.<\/p>\n\n\n\n<ol start=\"5\" class=\"wp-block-list\">\n<li>Ignoring small balances<\/li>\n<\/ol>\n\n\n\n<p style=\"font-size:16px\">Small, forgotten bills (like a final utility payment or a library fine) can eventually be sent to collections, causing severe, long-term damage to your credit profile.<\/p>\n\n\n\n<p style=\"font-size:16px\">Tip: Check your credit report for errors<\/p>\n\n\n\n<p style=\"font-size:16px\">Mistakes are common, so the Federal Trade Commission (FTC) provides a framework for <strong><a href=\"https:\/\/consumidor.ftc.gov\/articulos\/como-disputar-los-errores-de-sus-informes-de-credito\" target=\"_blank\" rel=\"noopener\">disputing errors on your credit<\/a><\/strong> report that could be unfairly dragging your score down.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Learn more about finance and business decision-making<\/h2>\n\n\n\n<p>Understanding the mechanics of credit is just the first step in navigating the global financial ecosystem. At <strong>MIU City University Miami,<\/strong> our Master\u2019s Degree in Business Administration provides students with the analytical tools needed to navigate corporate finance, investment strategies, and international markets. <\/p>\n\n\n\n<p>Whether you are looking to enhance your personal financial literacy, launch your own business, or lead a multinational corporation, our accredited <a href=\"https:\/\/miuniversity.edu\/en\/academics\/master-degree\/masterinbusinessadministration\/\">MBA program<\/a> gives you the keys to your future.<\/p>\n\n\n\n<p>Ready to master the world of finance?<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">References<\/h2>\n\n\n\n<p><br>Consumer Financial Protection Bureau. (2012). Key dimensions and processes in the U.S. credit reporting system. Retrieved March 30, 2026, from https:\/\/files.consumerfinance.gov\/f\/201212_cfpb_credit-reporting-white-paper.pdf  <\/p>\n\n\n\n<p>Federal Trade Commission. (2021).  <em>Consumer Advice: Disputing Errors on Your Credit Reports. <\/em>Retrieved March 30, 2026, from https:\/\/consumer.ftc.gov\/articles\/disputing-errors-your-credit-reports<\/p>\n\n\n\n<p>FICO. (2025). How Credit Scores are Calculated. Retrieved March 30, 2026, from https:\/\/www.myfico.com\/credit-education\/whats-in-your-credit-score <br>U.S. General Services Administration. (2026). Official Guide to Government Information and Services: Credit. Retrieved March 30, 2026, from https:\/\/www.usa.gov\/credit-reports    <\/p>\n","protected":false},"excerpt":{"rendered":"<p>What is credit and why is it important in the U.S.? In the United States, credit is a measure of [&hellip;]<\/p>\n","protected":false},"author":12,"featured_media":28159,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[1],"tags":[],"class_list":["post-28165","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"_links":{"self":[{"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/posts\/28165"}],"collection":[{"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/comments?post=28165"}],"version-history":[{"count":4,"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/posts\/28165\/revisions"}],"predecessor-version":[{"id":28180,"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/posts\/28165\/revisions\/28180"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/media\/28159"}],"wp:attachment":[{"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/media?parent=28165"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/categories?post=28165"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/miuniversity.edu\/en\/wp-json\/wp\/v2\/tags?post=28165"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}