If you have a long credit history and excellent credit score, it’s typically easy to secure a credit card. But what if you’re fresh out of college? What if your credit history is limited? Can you still obtain a credit card? A history of no credit could pose a challenge.
There’s no two ways about it: getting a credit card with no credit can be a challenge. However, with the right approach, you can kickstart the process and find yourself on the right path.
Here are some tips that can work in your favor:
1. You Need a Steady Income
Without this, credit card issuers have no reason to believe that you can repay your balance. So, don’t apply for a credit card until you secure a job that pays you a steady income.
Note: you’re asked to include your income on your credit card application, and doing so accurately is important.
2. Start with a Student Credit Card
If you’re still in college, a student credit card is a great place to start. Here’s why: the issuer doesn’t expect you to have a long credit history or high income.
In most cases, proving that you’re enrolled in college is enough to help you secure a card. Add in a regular source of income, even through a part-time job, and you’re on the right track.
3. Opt for a Secured Credit Card
A secured credit card is designed for consumers with no credit or bad credit. You’re required to make a security deposit to obtain a credit limit.
For example, if your security deposit is $500, your credit limit is typically the same. Even though this is a big difference when compared to unsecured credit cards, the way you use it is exactly the same.
Note: after six to 12 months of responsibly using a secured credit card, see if you can parlay your strong payment history into an unsecured credit card.
4. Find a Co-Signer
If you’re struggling to get a credit card on your own, find someone who is willing to co-sign. This can be anyone from a parent to a sibling to a spouse. By doing this, you take advantage of their credit history and score.
The one thing you need to remember is this: your co-signer is just as responsible for making payments as you, so if you slip up you put their good financial standing at risk.
In simple terms, you can absolutely get a credit card with no credit. It’s a bit more challenging than if you have a strong history and high score, but that shouldn’t stop you.
Once you know the type of credit card you’re interested in – such as a student or secured offer – it’s easier to compare your options and make a decision as to what you should do next.
Do you remember applying for a credit card when you didn’t have a long history? What steps did you take? Did your approach work?