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Don't have Any Credit? Try Creating An Alternate Credit File

Apr 16, 2008
If you have been looking for the ways to repair your credit score, then I am sure that you have come across companies that have mentioned obtaining an alternate credit file. Before mentioning its merits, it is important to know the concept behind creating these alternate credit files. A few years back the use of these files was rampant. However, the government started checking on some of the prevalent malpractices and an operation was conducted against some vested interests. The hypothesis behind alternate credit files was to create a new credit file for those with bad credit simply by using an Employment Identification Number (EIN) instead of their Social Security Number (SSN).

No doubt, there was some illegitimate use of alternate credit files by people with bad credit to conceal their bad history. However, at the same time it also might be true that there were a number of people who were sincerely paying off all of their bills in cash or others who did not have any credit in their own name and lack of a traditional score. As these people do not posses any written record of their payment history it does not matter how responsible or fair these people have been in their payments. But when the people falling into this category seek some other type of financial loan or help they faced problems.

Currently everybody from insurance agents to employers asks for your credit score. With that in mind alternate credit files can play a significant role and especially in the situations above, the use of a new credit file is not legitimate. It is due to the fact that persons using alternate credit files in this case are not using it for genuine reasons but not to relinquish his/her true credit. Because of the use of this file the person will not owe any due amount in his or her name.

So if you are looking for an alternate credit file for the reason of not wanting it on your file or lack of credit, it is recommended that you seek a new credit file under a corporation. In this situation your business can apply for credit. However, even if you do not have a business you can simply set one up under the form of a holdings corporation. For this, use your last name and add holdings, however to do it correctly you should consult an attorney before you actually do so.

Once you are able to get your business the entity designation you are looking for, you become eligible to apply for business credit in your companies name. In this method you have created a legitimate alternate credit file without violating any of the laws.

In conclusion, alternate credit files can prove to be helpful to those with out any credit history and with the use of these files they can apply for any loans that might be needed.
About the Author
J Delgado is an expert in helping individuals restore there credit. To find out more about having foreclosures, bankruptcies, late payments and other derogatory items removed from your credit report contact him at creditexpert@scrubyourcredit.com or at: http://www.scrubyourcredit.com
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