How to build credit without a credit card

Your credit score can impact your life in many ways. When you want to do things like rent a place to live, get a good rate on a private student loan, or even get a job, your credit can be important

Using a credit card responsibly is one way to build credit. But what if you’re not ready for a credit card or aren’t approved for one? How can you get a good credit score

Luckily, you can still build your credit without a credit card. 

Key takeaways

  • Becoming an authorized user on someone else’s credit card can help build your credit. Just be sure the primary cardholder pays their credit card bills on time or it could affect your credit negatively.
  • Taking out a credit-builder loan and consistently making payments is another way to boost your credit score.
  • If you rent, you can ask the landlord to report your rent payments to credit bureaus.
  • Keeping your existing loans and bills in good standing can support your credit-building efforts. 
  • If a traditional, unsecured credit card isn’t an option, a secured credit might be worth considering.

1. Become an authorized user

Does someone you trust, like a family member, have a good credit score and credit history? You may consider talking to them about becoming an authorized user on their credit card account. But remember, an authorized user and a co-signer aren’t the same thing, and major credit card companies typically don’t allow co-signers.

Becoming an authorized user on someone else’s credit card means you’ll have access to their account and be able to make purchases with your own card. But only the primary cardholder will maintain ownership of the account and be responsible for making payments on time. But some issuers, like Capital One, may also provide online access for eligible authorized users.

Missed payments by the primary cardholder might negatively impact both their credit score as well as yours if the card issuer reports authorized user activity to credit bureaus. But, on the flip side, their responsible credit use could have a positive effect on your score. Just make sure the issuer reports authorized user’s information to the credit bureaus.

2. Apply for a credit-builder loan

According to the Consumer Financial Protection Bureau (CFPB), credit-builder loans are typically between $300 to $1,000 and can be a good option to help build your credit. They’re different from most traditional loans, however. With a credit-builder loan, you’re required to pay off the amount owed before you’re allowed access to the money. 

Getting approved for a loan but not having immediate access to your funds may seem contradictory. But one benefit of this type of loan is that you’re building a payment history. Lenders report that information to the credit bureaus. And if you’re on time with all your payments, you could see a positive impact on your credit score.

3. Use personal loans responsibly

A personal loan can positively impact your credit score if you consistently make your payments in full and on time. 

Personal loans are a type of installment loan that don’t have to be used for a particular type of purchase. And unlike credit-builder loans, you’re given an approved amount upfront. If you have personal loans—or you’re considering one—it’s worth checking whether the lender reports payments to credit bureaus.

4. Make rent payments on time

Rental payments could appear in your credit report, so consistently making monthly payments on time could help your credit scores.

If you’re a renter, consider asking your landlord if they report your payments to any of the three major credit bureaus: Experian®, Equifax® or TransUnion®. Many landlords run credit checks on potential tenants, but not all landlords report rental payments. If yours doesn’t, you can ask them to report your payments to Experian RentBureau or another rent-reporting program.

You might consider setting up automatic payments to ensure you don’t miss a payment due date. You could also use email reminders or calendar alerts to remind yourself.

5. Pay all other bills on time

Your payment history—specifically, making on-time payments—is usually the most important factor in determining your credit scores. Credit-scoring company FICO® says it makes up around 35% of its scores. Payments to installment loans like federal student loans are typically reported to credit bureaus. So be sure to make payments according to the loan terms on any loans you already have.

It’s also a good idea to make consistent on-time payments for things like your cellphone and utility bills that tend not to get reported to credit bureaus. Not only is it a good habit, but you might also be able to use a service to report payments to credit bureaus—and raise your score.

6. Watch your credit utilization ratio

Your credit utilization ratio is a measure of how much of your available credit you’re using across all your credit accounts. It’s an important number, which can account for 30% of some credit scores. Only revolving credit figures into your credit utilization ratio, so installment loans typically won’t impact it. 

In general, it’s best to keep your credit utilization at 30% or under—and ideally at 10% or under.

7. Consider a secured credit card

If you’re not ready or weren’t approved for a traditional credit card, there may be another option. 

You may be able to build credit without a regular credit card by applying for a secured credit card. Unlike unsecured credit cards, secured cards require a security deposit. But with responsible use, they could be a good way to build credit. You might also become eligible to upgrade to an unsecured card.

Some credit card issuers may not report the status of secured cards. So if better credit is your goal, look for a secured card that reports to at least one of the three major credit bureaus.

With or without a credit card, you can still take steps towards building good habits and a better credit score.

8. Practice good personal finance habits

It’s important to build and maintain good financial habits. In addition to making payments on time every month, it could help to:

  • Create a budget. Creating a budget to compare your income to your expenses is a key step to reaching your financial goals, the CFPB says. Seeing where your money goes each month could help you set aside loan or credit card payments before you start spending each month.
  • Build an emergency fund. An emergency fund can help you weather an unplanned expense or situation and still be able to pay bills and avoid additional debt. The CFPB recommends setting a goal, making regular contributions, and monitoring and celebrating your progress. It also suggests keeping your funds somewhere accessible and safe, such as a savings account that won’t be tempting to pull from. 
  • Monitor your credit score. CreditWise from Capital One makes it easy to monitor your credit. And it’s free to use whether you’re a Capital One customer or not. Plus, using CreditWise won’t hurt your credit, so you can check it as often as you like.
  • Request your credit reports. Federal law allows you to request one free credit report from each of the three major credit bureaus every year from If there are any errors on your credit report, they could be affecting your score.
  • Have a good mix of credit types: Credit mix is another factor in credit scoring. Credit cards are a type of revolving credit. Installment loans, such as mortgages, car loans and student loans, are another type. Having a healthy mix of loans and credit might improve your credit.

How to build credit without a credit card—in a nutshell

Building credit takes time. But it can be done, even if you don’t have your own credit card. From becoming an authorized user on someone else’s account to keeping other loans and accounts in good standing, there are simple ways you can focus on growing your credit.

Practicing good financial habits and avoiding debt you can’t manage can also help. And it might be a good idea to monitor your credit and track your progress with a tool like CreditWise.

When you’re ready to explore credit card options, learn how credit-building cards could help you establish a financial foundation.

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