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Building your credit score without a credit card

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    Making credit card payments is one of the major ways people can establish a credit score, but it's not the only way.

    Here are some alternative methods for building your credit score, without using a credit card to do so.

    Can you have a credit score without having a credit card?

    Yes, you can establish credit and have a credit score without a credit card. Credit card companies are not the only ones that report your payment and usage history to the three credit bureaus that report on your credit score, Experian™, TransUnion® and Equifax®. Other actions, such as making repayments to a federal loan under your name to applying for a phone line (if the phone company reports to credit bureaus) can help build your credit score.

    How to establish your credit history without a credit card

    Below are a few ways you can establish and build credit without a credit card:

    • Have a phone plan: If you have a phone plan in your name, your payment history may be reported to the three credit bureaus, depending on your type of contract and the phone company you are using. This means that on-time phone bill payments could improve your credit score over time. Your phone company may have also placed a hard inquiry (credit check) on your credit report when you first applied for service to the phone company, which also appears on your credit history. This could have a short term negative impact on your credit score. But be sure you're prepared and capable of carrying a phone payment before you apply. A rejected application could also reflect negatively on your new credit.
    • Rent payments: Rent payments may be reported to your credit bureau. This is not a very common practice among all landlords or property managers, but it is worth checking with yours to see if your payment history has been reported to the three credit bureaus as new programs and technologies allow landlords to opt for this.
    • Become an authorized user: Without having to apply for a credit card of your own, you can request to become an authorized user on another person's card. This person may be a parent, legal guardian, or a trusted individual with a good credit history, which can also impact your score overtime.
    • Federal student loans: Payments toward your federal student loans are reported to the three credit bureaus. If these loans are under your name and you have been making on-time payments, check your credit score to see if your payment history (which is highly influential to your credit score) is being applied. Be aware that missed or late payments on federal student loans could be negatively affecting your credit score.

    Establishing credit without a credit card

    If you do not want to commit to a credit card, there are other methods for establishing and building your credit score. Contact your utilities or loan companies to find out if your payment history is being reported to the three credit reporting bureaus, Experian™, Equifax® and TransUnion®. Consistent and on-time payments toward federal student loans can improve your credit score, which is important for future loans and credit card applications. Some rent and utility companies also report on your payment history, so it is worth understanding which ones do so you can avoid late payments that could negatively impact your score.

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