How to build credit (when you have no credit)

Trust us, it’s possible

Credit is necessary in the economics of American society. If you want to get a credit card, an apartment, a car, or even a loan—your credit is important.

Your credit score provides lenders with an idea of how likely you are to pay them back. Many things go into building your credit score: paying your bills on time, your credit cards as well as assets like paying your mortgage. However, we understand not everyone has a credit card or a mortgage.

We also know that someone with poor credit may not have lenders willing to extend you a line of credit. So how do you build credit to set yourself up for bigger purchases and/or lower interest rates? First off: pay your bills on time. This will automatically increase your credit score. However, there are a few additional ways to increase your credit score quickly.

theGrio spoke with financial expert Aisha Taylor, founder of Frugal-N-Phenomenal, who shared three ways on how to build credit in a short period of time if you have no credit, poor credit, limited income, or you are unemployed.

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(Adobe Stock Image)


 Your bills are only reported to the major credit agencies (Experian, TransUnion, and Equifax) when you are delinquent or go so long with non-payment that they are sold off to a collection agency. However, do you know they can also boost your credit?

Taylor shares, “Experian will allow customers enrolled in their Experian Boost program to include their utility, phone bills, Netflix, Hulu, Disney +, and HBO payment history to help improve their credit score.” Now while you Netflix and chill, you credit score can be increasing!


This might sound scary, but can benefit your credit immensely. If someone you trust has excellent spending habits and credit, see if they’ll add you as an authorized user to their credit card.

Taylor reveals, “They don’t have to give you the card to use. If you do this please understand that whatever that person does, both positive and negative, will impact your credit score. Therefore, choose someone who has good credit and uses their credit responsibly so you can reap the positive benefits of being an authorized user on their credit card account.”

This Aug. 11, 2019 file photo shows Visa credit cards in New Orleans. U.S. consumers increased their borrowing in September 2020, helped by the first gain in the category that covers credit cards in seven months. (AP Photo/Jenny Kane, File)

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Make your cash work for you. A secured credit card simulates a credit card with the only difference being that a secured credit card is one where you put down a cash deposit in advance that will serve as your credit card limit.

Taylor shares this credit hack, “If someone has a low income and cannot qualify for a standard credit card, then they can save for a couple of months and then open the secured credit card.”

Using the card to make payments will help build your credit and is worth the saving investment. Most secured credit cards require anywhere from a $200 to $300 minimum cash deposit. The deposit is normally refundable and becomes your credit limit.

Taylor affirms, “This is also a great strategy for someone with poor credit who is unable to open a new credit card or increase their credit limit.” Debit cards don’t build credit, so this is a great option if you are trying to build credit and have no credit.

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