5 Ways to Build Credit When You Have None

Posted on September 20, 2021
a young woman excitedly holding the no credit credit card she was approved for

Getting approved for financing is one of those classic chicken vs. egg situations. You need to prove your credit history to get the loan or credit card you want — but you can’t build credit if you’ve never had a loan or credit card in the first place.  

Luckily, there are a few simple ways you can start building your credit score today so that you’ll be able to borrow for the big things in life later on. After all, you’ll need an auto loan to buy a car and a mortgage to secure your dream house. 

Tips for Building Your Credit 

If you’re wondering how to build your credit when you have none, you can relax knowing there are a few different options. 

At least one of these proven methods should boost your FICO credit score:

1. Get a Secured Loan

A secured loan means your credit union or bank will use your savings or certificate of deposit (CD) as collateral for your loan. You can usually borrow the same amount of money as your funds, up to a limit set by your financial institution. 


  • You’ll keep earning interest or dividends on your funds.
  • You won’t have to pay an early withdrawal penalty from your CD. 
  • You’ll start building credit once you’ve made a few punctual payments on your loan.


  • You can’t get a secured loan unless you have the funds to use as collateral.
  • You won’t be able to access your savings until you’ve paid off your loan in full.

2. Set Up a Joint Loan or Credit Card Account

A joint loan or credit card account means another person co-signs on the account with you. If you fail to pay, they will have to pay for you. 


  • You share the responsibility so borrowing money is less overwhelming when you’re just starting on your credit journey. 
  • Once you’ve paid off the loan, or paid your credit card bill on time for a certain period, the other person will be able to remove their name and you can fly solo.


  • Not everyone knows a person who is willing and able to co-sign on a loan. They need good credit and a steady income. 
  • If you can’t pay and your co-signer also misses a payment, both of your credit scores will likely be negatively impacted. 

3. Become an Authorized User on a Family Member’s Credit Card

This option is less of a commitment than co-signing on a loan or credit card and can be just as effective in building your credit. 


  • Your name is on the account so you can make purchases and payments and these will contribute to building your credit.
  • Once you’ve successfully made payments and purchases for some time, you should qualify for your own credit card, which may boost your credit more than being an authorized user only.


  • You aren’t entitled to all the same features of the account as the primary cardholder. For example, you can’t apply to increase the credit limit, add more users, or redeem any rewards offered by the card issuer.
  • If you fail to make payments on your purchases, your family member’s credit score will likely suffer too. 

4. Apply For “No Credit” Credit Card

Your credit union or bank may offer a credit card designed especially for people in your shoes. 


  • You can get this card even if you have no credit score.
  • Your credit union or bank will review your account after a certain period. If you’ve made all your payments on time, you may qualify for a different card with lower interest rates.


  • You need a cash deposit to secure your secured credit line. 
  • You may face slightly higher interest rates until you prove your creditworthiness.

Partners Financial offers its own fee-free, low-fixed rate Visa Credit Card for members hoping to build their credit when they have none or little to work with. Let us work with you to start your credit-building journey! 

How to Get a Credit Card With No Credit

5. Apply for a Low-Balance Credit Card

Once you qualify, you can graduate to a regular credit card and focus on maintaining a low balance compared to your limit.


  • You can use your card to make purchases and take care of expenses — just be sure to pay back at least the minimum amount each month.
  • Maintaining a balance of less than 30% of your limit means you’ll have a good credit-to-debt ratio, or credit utilization ratio, which is great news for your credit score.
  • This system of revolving credit, where you borrow and pay back in a cycle, is an effective way to build credit when you have none.


  • You shouldn’t use too much of your credit limit at any one time.
  • You shouldn’t spend more than you can easily pay back in the same month. 

Why You Should Pay Your Bills on Time

Once you qualify for a credit card or loan, you should always make your payments on time every month. Delinquent payments will show up in your financial history and negatively affect your credit score. 

On the other hand, you may think that being responsible and paying your utility bills on time each month will lead to a great credit score. But, generally, that’s not the case. 

It’s important to note:

  • Your punctual utility bill payments probably won’t show up as positive features of your FICO credit score financial history. 
  • If you don’t pay your utility bills on time and they’re referred to a collection agency, this will likely hurt your credit score. 
  • If you don’t pay your credit card bill or loan payment on time, it will negatively impact your credit score.

How a Credit Card Can Make Great Credit History

Now that you know how to build credit when you have none or little to start with, here’s how you can boost your credit score even more with a credit card.


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