How to Get a Credit Card With No Credit History or Bad Credit
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It’s true that credit is an extremely important aspect of your financial identity. Your credit is shaped and molded depending on how you treat it. For those with a blank slate of credit, or damaged credit, it can feel as though getting a credit card will be impossible for you.
However, that’s not exactly the case. Though you may not qualify for the types of credit cards that someone with good credit will qualify for, there are still options for you. Through checking your credit you’ll have a better understanding of where you stand and what to do next.
Check Your Credit Score and Read Your Credit Report
It is possible to get a credit card even if you have no credit history, or if you have a poor credit score and need a credit card to start rebuilding. The options for both situations are actually very similar. The starting point should always be to check your credit score and read your credit report. You may have more history than you realize, your score may not be as bad as you think, and/or you may even be able to take some simple steps to rebuild or begin building a credit history.
There are a number of ways to check your FICO score to find out where your credit stands. Once you’ve done that, you’ll have the information you need to figure out which kind of credit card you are able to get and how to use it wisely.
Consider Getting a Secured Credit Card
A secured credit card is one way to get a credit card even if you have a bad or limited credit history. Credit cards are a great way to help your credit health and secured cards offer a way to do that without taking on substantial debt. A secured card basically requires a deposit equal to the amount of your credit limit. This reduces the risk for the company issuing you your credit card and reduces your risk to spend more than you have and dig yourself into a deeper credit hole.
Paying your credit card bill on time is one great way to build credit. For that reason, it can be frustrating for those who would like to use one to fix a low credit score or absence of credit history. Luckily, secured credit cards are perfect for this type of situation.
Become an Authorized User on a Credit Card
The idea behind authorizing users on a credit card is that the primary cardholder will be responsible for payments, and the authorized users on the account can charge purchases to the card without being responsible for the payments. The authorized user does, however, gain good credit by the responsible use of this card, even though they are not directly responsible for the payments.
Clearly this is a great deal for the authorized users, but potentially dangerous for the primary cardholder. However, this is a great opportunity for both situations of poor credit or no credit when handled responsibly. If you’re allowed to be an authorized user on a credit card, it’s important to respect the risk the cardholder is taking and handle the card wisely.
Get a Cosigner
As someone with poor credit or minimal credit history, you may qualify for some types of credit cards. Unfortunately, those cards tend to have high interest rates. Once you have your credit card, there are some ways to utilize your credit card that can avoid the interest. However, you may have better luck finding a card with a manageable interest rate if you find a cosigner.
Cosigners are utilized for a variety of reasons like getting your first apartment, buying your first car, or renting an apartment with poor credit, among others. Leveraging a cosigner for a credit card is done for similar reasons, and carries with it many of the same risks. It’s important to be committed to responsible credit card utilization due to the risk your cosigner is taking by agreeing to cosign for you.
Apply for Retailer-Specific and Limited Purpose Credit Cards
Though it may be difficult to obtain a regular credit card without a deposit or a cosigner, you may be able to qualify for a limited use credit card through a retailer. These cards are only applicable for purchases made within that store. However, they do tend to have low credit limits and high interest rates, so it’s best to use these cards conservatively.
By making small charges and paying the balance in full each month, it’ll help to build credit while avoiding the interest charges. Though you should always be careful with your spending, especially when your credit needs to be built, you may also find extra perks similar to those that come with a normal credit card. You may be able to gain rewards while shopping, though you should make sure you keep that in perspective and not allow spending to get away from you.
Having bad credit or limited credit is a similar problem to have. It can cause feelings of being financially stuck. It’s a catch-22 when you consider needing a credit card to build credit, but needing good credit to get a credit card. Fortunately, that’s not exactly the case.
In reality, you can obtain a credit card even if your credit is limited or low — you just might not be able to get a credit card in the same way. By checking your credit score you’ll be able to get a better idea of your financial identity. After that, if your credit is too damaged or limited, you can look into obtaining a secured card, establishing a cosigner, or applying for a limited purpose credit card. By doing that, you’ll be able to utilize your credit card to increase your credit and take your financial identity to the next level.
For more information on credit cards, visit our credit card resource center. Need more information on credit scores, and how to dispute inaccuracies? Visit our credit score resource center and dispute letter resource center.
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Chelsy is a writer from Montana who now lives in Boise, Idaho. She graduated with her journalism degree from the University of Montana in 2012. She enjoys talk radio, cold coffee, and playing Frisbee with her dog, Titan. Follow Chelsy on Twitter @Chelsy5
This post was updated May 8, 2018. It was originally published April 7, 2018.