Credit card companies offer credit cards to those who have no credit history in order to assist them develop credit from scratch. You may build a solid credit history and a positive credit score by using a credit card responsibly, making on-time payments, and limiting how much available credit you utilize. These steps can lead to improved rates and terms for the financial products you require. To assist you find the best credit card for no credit history, we compared the finest offers from our credit card partners.
Individuals with no credit often have the hardest difficulty obtaining a credit card. This is because most credit card companies require a credit score before they can approve a new credit card application. You will not have a credit score, however, until you have had at least one active account on your credit report for six months. Some credit card companies recognize that people have difficulty getting their first credit card and have created credit cards exclusively for persons with no credit.
Make Certain You Have a Job
You must have enough revenue to pay off your credit card bill, especially if you are under the age of 21. The income you list on your credit card application must be your own; you cannot qualify for a credit card using the income of your parents, spouse, or other household members unless you have reasonable access to that money.
Income restrictions differ every credit card, but you must earn enough money each month to repay your credit card bill. Even if you don’t have a credit score, the higher your income, the better your chances of getting approved for a credit card.
Apply for a Credit Card in Advance
A few large credit card companies offer online pre-qualification, which allows you to see if a credit card is available for your credit profile. These pre-qualifications are often soft credit checks, which means they will not harm your credit score or appear on your credit report if someone else checks it.
If you eventually apply for a credit card, that hard inquiry will appear on your credit report and has the potential to reduce your credit score.
Pre-qualification for a credit card does not guarantee acceptance. Other criteria, such as your income, may cause you to be declined for a credit card for which you have pre-qualified.
If you are denied, you will get a letter in the mail explaining why. Utilize the information in the letter to help you determine what to do next.
Capital One Pre-Qualification
Apply for a Student Credit Card. You may be eligible for a student credit card if you are a student. These cards are intended for college students who do not have a significant income or credit history. You may be required to produce confirmation that you are enrolled in an approved institution or university in order to qualify. Choose wisely. Some student credit cards charge exorbitant interest rates and fees.
Request a Shop Credit Card
Retail store credit cards are known for approving credit card applications from persons with no credit. You are more likely to be approved if you use “closed-loop cards” that do not bear the Visa or MasterCard logo. You won’t be able to use the credit card outside of that specific store, but it will allow you to start building your credit history. Be in mind that retail store credit cards have minimal credit limits and hefty interest rates. To prevent paying a lot of interest, keep your balance low and pay it off.
Apply for a Secured Credit Card
Secured credit cards are used by persons who are unable to obtain a standard credit card.
There’s nothing wrong with having a secured credit card as long as it reports to the major credit agencies and has a low cost structure.
A secured credit card differs from regular credit cards in that you must make a security deposit in order to obtain a credit limit. Several secured credit cards have high costs, but there are a few credit cards that have low fees. If you don’t have enough money for a security deposit right immediately, you can save up for it over a few months. For a $200 credit limit, the Capital One Secured MasterCard requires a minimum security deposit of $49, $99, or $200.
Get a Co-Signer
If you are unable to obtain a credit card on your own, you may be able to benefit from someone else’s good credit. You might ask someone with a job and strong credit to apply with you, but keep in mind that acquiring a credit card with a cosigner has disadvantages.
You have someone else looking after your finances, checking your purchases and making sure you pay your credit card. If you are not responsible with the credit card, such as missing payments or maxing out the card, the cosigner’s credit will suffer as well. Before you get a credit card with someone else, think twice.
Avoid filling out numerous credit card applications. If you are denied for a big credit card, even if it is a student credit card, do not apply again. Look for a retail credit card or a secured credit card instead. Select these credit cards ahead of time so you aren’t scrambling for a credit card that will accept you.
Any credit card that assures acceptance without first verifying your credit score should be avoided. There is almost certainly a catch in the form of hefty fees, excessive interest rates, or both.
A prepaid card can be used in place of a credit card if you do not have a bank account or a debit card. Prepaid cards do not aid in the development of a credit history. These merely let you to conduct credit card-like transactions, such as paying at the petrol pump.
Once you’ve been authorized for a credit card, make sure you use it carefully in order to qualify for better credit cards and loans in the future. To develop a strong credit history, keep your debt modest and pay it off in full every month.