If you don’t have any credit you may be thinking that there is no way you can get a credit card. Luckily you are wrong. There are stills a number of ways you can get a credit card without any previous credit history. Using these cards, you can build your credit, establish a credit history, and have more financial opportunities down the line.
Check Your Credit Score
Firstly, you should verify that you do not have any credit. There are a few ways you can view your credit report. You can request a free copy of your report from one of the three major credit reporting bureaus. You are granted one free copy a year from each bureau. You can also use a free service like CreditKarma to see your score. Make sure you are not signing up for a service that will charge you, though.
You might actually find that you do have a credit score. If you had a credit card that your parents cosigned with you, this is likely the case. As long as the payments for this card were made on time, your score may already have improved.
Apply With A Cosigner
True, there are credit cards out there for people with no credit history. However, you will probably get a better interest rate if you apply with a cosigner. There will also be more card options available to you. Cosigning allows you to jump on their credit and income information, making you look better.
Make sure the person you ask to cosign has a high credit score and good credit history, otherwise you may be denied regardless. You will also want to make sure they understand the risks. If you are unable to pay the monthly bill, it will be their responsibility to do so. Ask a parent, close friend, or trusted family member to be your cosigner.
This is a very popular option for people with unfavorable credit reports and low scores. These cards are different from other credit cards as they require a security deposit to open the card. If you do not pay your bill on time, the issuer will use your deposit. However, you need to make on time payments every month in order to improve your credit score and build a good history.
Tips For Choosing A Credit Card
If you do not have any credit history, this is probably your very first credit card. Here are a few tips that will make choosing the card a little simpler.
- Keep track of your credit score. Once you open your card account and begin making on time payments, you will notice your score increase.
- Before signing up for your card, read the fine print details. Make sure you fully understand the limitations and details of your card. Be on the lookout for cards that can only be used in certain stores or cards with drastic interest rate increases.
- Pay back your balance every month. Only make small purchases and pay off the whole balance every single month. Without any credit history, one missed payment or balance carried over can severely damage your score.
Your very first credit card will impact your credit report for years after you open it. You might not have credit right now, but that will all change very quickly thanks to your new card. If you make an effort to keep your credit in good standing while you can, it can save you a lot of work later on. It is much easier to build credit from scratch than it is to repair damaged credit.