Can I Build Credit by Getting an installment loan?

Building credit is something lots of people strive to do but they don’t know how to build credit. Having a credit card can be a good way to build credit but it can also be the fastest way to get into debt. Many people do not want to get a credit card for that reason so they look to see if taking out an installment loan is actually a good way to build credit. But in all reality taking out loans just to build credit is kind of stupid. Installment loans have a lot of interest attached to them because they are easy to obtain. So you will end up paying a good amount in interest rates just to build your credit. Lets say you would like to buy a used car for $10,000 and you have that in cash then taking out an installment loan for $8,000 could be a wise choice if you know you can make those payments on time. You will generally pay the same amount but it would help build your credit by having monthly payments. So can you build credit by getting an installment loan? You can but it is not the most logical way to build your credit.

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