7 Major Purchases That Can Help Build Credit

Wise Loan Editorial Team
By: Wise Loan Editorial Team
customer paying for order with a credit card in store

Build Your Credit

Did you know that there is a concept called “good debt“? While debt often receives negative attention due to the risk of getting trapped in a cycle, it’s important to acknowledge that some significant purchases become feasible only with the use of credit.

On the flip side, making substantial purchases using credit offers an opportunity to demonstrate responsible handling of credit, leading to potential credit-building benefits. Here’s how this premise works and a list of seven major purchases that can help you enhance your credit profile:

Using credit to make a purchase can be beneficial for building credit when:

  1. You consistently make on-time payments, regardless of whether you used a loan, credit card, or line of credit. Timely payment history significantly impacts your credit score.
  2. You manage multiple types of credit. Credit scoring models consider a mix of installment and revolving credit accounts. A large purchase can diversify your credit types.
  3. You build credit age, which contributes to your overall credit score. Large purchases may take time to pay off, but this process can lengthen your credit age and positively impact your score.

However, it is crucial to make informed decisions about making a large purchase to build credit. You should ensure that the purchase fits within your budget and genuinely adds value to your life. Here are seven major purchases that could be considered:

  1. A Car or Truck: A significant commitment, but using a car loan may provide refinancing opportunities if your credit improves over time.
  2. Furniture: Many people buy furniture on credit, and options like 0% APR offers can help manage payments effectively.
  3. Jewelry: Fine jewelry stores often offer financing options, making it possible to buy special items using credit.
  4. A Home Computer: Upgrading your home office with a new computer can be financed to build credit.
  5. New Home Appliances: Purchasing new appliances and making timely payments can improve your credit profile.
  6. Home Improvements: Utilizing home equity loans or lines of credit for home renovations can positively impact your credit.
  7. A Recreational Vehicle: Besides cars and trucks, boats, ATVs, and campers can also be purchased using credit, provided you can manage the payments and integrate them into your lifestyle.

7 Major Purchases That Can Help Build Credit

It is essential to exercise caution and not make significant purchases solely to boost your credit. Always ensure that the decision aligns with your financial capability and long-term goals.

If you require quick funding for a purchase and wish to potentially build your credit, you may explore applying for an instant funding loan with Wise Loan. This option can help you finalize your purchase responsibly.

The recommendations contained in this article are designed for informational purposes only.  Essential Lending DBA Wise Loan does not guarantee the accuracy of the information provided in this article; is not responsible for any errors, omissions, or misrepresentations; and is not responsible for the consequences of any decisions or actions taken as a result of the information provided above.

More information on Installment Loans and how they work in your state:

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About the Author

Wise Loan Editorial Team

Wise Loan Editorial Team

Introducing the Wise Loan Editorial Team – a collective of experienced finance and credit professionals dedicated to enhancing your financial path. Our team boasts over three decades of expertise in the finance sector, united in our commitment to deliver reliable and practical financial insights. True to the Wise Loan ethos, our goal is to positively impact the financial well-being of our customers.

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