If you or your family has a business relationship with a local bank or credit union, they may be willing to extend credit to you. If the banker knows you personally, it's possibly that you could get a small loan on just your signature alone (of course, there's much more likelihood of this happening in a small local bank as opposed to your local branch of a regional or national institution). Or, you could be required to provide some type of collateral, such as that used for passbook loans. Be prepared to explain what you'll use the money for and how you plan to repay it. But also make sure that the lender will be reporting your loan and payment record to the credit bureaus, for the same reasons as stated earlier.

Loans are also available for the purpose of paying for higher education expenses. The applications and requirements vary according to the type of loan that's being sought. The financial aid office of the school or college that you want to attend is a good place to start the process. Repayment generally isn't required to begin until completing your program of study or leaving school. These loans are reported to the credit bureaus, so this is a great opportunity to establish your credit history. Another possibility for establishing good credit is with the aid of a co-signer. For example, the parent of a teenager buying his or her first car may co-sign for the loan, guaranteeing its repayment in the event that the son or daughter doesn't meet the obligations. If the teen pays according to the terms and conditions of the contract, he or she will be well on the way to establishing a very good credit history. It should be noted, however, that it might be somewhat more difficult to find someone who's willing to co-sign for you if you're trying to reestablish credit following a bankruptcy or other financial mishap.

Once you've received a new credit card or obtained a loan, the importance of making timely payments cannot be more strongly emphasized. Even one late payment can be detrimental to your credit file. Endeavor to use your new credit wisely and responsibly, making all of your payments before they're due, and your credit history will reward you now and in the future with lower payments, lower overall costs, and a much more convenient lifestyle.