3 Credit Card Tips for Those with Little to No Credit!

Getting started in the world of credit seems like an uninviting cycle where you need to already have credit to even start building your credit. Good credit is required for so many decisions we make in life such as taking out a mortgage, buying a car, obtaining low-interest credit cards, and even renting an apartment.

Here is a short guide of steps, tips, and tricks to follow to begin establishing your credit.

1) Get Added as an Authorized User on Someone’s Credit Card.

If you have a financially responsible family member with credit cards that are in good standing and have a low accumulated balance, they can add you as an authorized user on their card. As an authorized user, you will obtain credit even if you never use the card! You just want to make sure that the owner of the credit card will be in good standing for the time to come - if they miss payments or rack up too much debt, this will show up on your credit!

2) Get Pre-Qualified for Credit Cards Online.

In 2019, we are able to see if we are likely to qualify for something based off of a soft-pull of our credit report. This will not count as an inquiry for future lenders to see. Before entering your information - you typically want to make sure it says that there will be no impact to your credit score somewhere on the website.

After you fill out the qualification application, it will typically provide a list of realistic credit cards you are pre-qualified for. Select the one with the best approval odds, but also the best features. You will want a lower APR and either a no-or-low annual fee.

Click here for the pre-qualification form on creditcards.com.

3) Get a Secured, Student, or Starter Credit Card!

• Secured Card: A secured card is a credit card that typically requires a down payment as collateral for you to obtain and use the card. It can be as low as $49 and be as high as the balance they allow you to have. Example, for a $300 limit - they may require a $300 deposit. This deposit is usually refundable if you cancel your credit card while it is in good standing.

  Capital One Secured Card is a good card to start with. The annual fee is $0 and security deposit for no credit is usually $49 and for bad credit it can go higher.

  Click here for a list of other secured cards you might qualify for.

• Student Card: If you are enrolled in college, you are typically eligible for some student credit cards. These offer relatively low fees and interest rates for students. They can even offer other incentives if you have good grades!

  Discover Card has a great credit card for college students.

• Starter Card: These types of cards typically don’t require any previous credit history. They sometimes can have higher annual fees and interest rates with a low starting credit limit. A higher credit limit does help impact your score.

  Check out Petal Card, they market towards those with no credit and have a great rate and no fees.