Sometimes no credit is as detrimental to a person as bad credit. If you’ve never had credit, start building it today.
Build Credit from No Credit
If there is no credit history the position for giving loan is not available and so one is deprived of any loan. This may seem like an impossible task, but there are ways to build credit when there is no credit.
Steps to get credit when no credit
Get a secured credit card— A secured credit card is one where a security deposit is put to assure the creditor that the debt will be paid. A debit card is different from a secured card. A debit card is just away to access the funds in the bank and this cannot be used by creditors. A secured car is an extension of credit. The secured affects the credit score positively or negatively.
Only charge what is affordable to be paid- The ability to pay is built up by building credit means. Hence purchase only to the extent of payment. In order to increase the card score the credit card should be used from time to time, maybe for small purchases.
Pay on time every month is the most important thing to build and maintain a good credit. A single late payment can damage the credit score.
Avoid applying for numerous accounts a new credit loan affects the credit score. So it is better to manage with a single card to pay the loans in time
Check the progress by checking the credit report and score regularly and note for any positive or negative statement listed. This will help in working better in future.
After a year, apply for an unsecured credit card– A period of one year is enough to show the worth of payment and hence a switch can be made from a secured to an unsecured card. There will be no more deposit needed and it will lead to a higher credit and reward points could also be added.
The key to building credit lies in patience. A good credit card is liable to all financial transactions in life. There is no need to worry if there is no credit score. Build the credit with no credit by following some steps stated in this article.