How to Build Credit When You Have None
Having no credit history can be just as challenging as having bad credit. Without a credit score, you may struggle to rent an apartment, get utilities, or access affordable loans. Here is how to start building credit from scratch.
Start with a Secured Credit Card
Secured cards require a deposit that becomes your credit limit. Use the card for small purchases and pay the full balance each month. After six months to a year of responsible use, you can often upgrade to an unsecured card and get your deposit back.
Other Ways to Build Credit
- Become an authorized user: Ask a family member to add you to their credit card
- Credit-builder loans: Small loans specifically designed to build credit
- Report rent payments: Services like Experian Boost can add rent to your credit file
- Store cards: Often easier to get but use cautiously due to high interest
Keys to Success
- Always pay on time – payment history is the biggest factor
- Keep balances low – use less than 30% of your available credit
- Do not open too many accounts at once
- Check your credit reports for free at AnnualCreditReport.com
