no credit history

What if you have No Credit History?

If you don’t have an extensive credit history, or have never had a credit card, catalogue account, or other loans, you might find it hard to get approved for certain loans and cards. For this reason, you should understand which cards to apply for, what to forego, and how long to wait, before you will be approved for certain cards/loans you would like to apply for, when you don’t have a long-standing line of credit.

Can you apply?

Yes; in fact, even if you are new to credit and financing, you should apply. But, don’t go out and apply for a £50,000 loan or mortgage. Rather, go with a catalogue site. Oftentimes these are a great way for you to get your feet wet, to build up your credit score, and start a credit history. These catalogue sites are more lenient, and even if you are approved for a low amount, it is a good way to build up your score.

Choose secured cards

Another great way to go about applying to build up your credit is through credit cards. However, many major credit cards won’t approve you without a credit line or history. So, instead, you can choose secured credit cards. Your limit is typically going to be around £200-£500, but this is a good way to build up your score. It allows you to make payments each month, show you are a responsible spender, and that you won’t be late on payments or miss payments. Over time, you’ll get more offers, and higher limit increases.

Try a school loan or secured loan

Student loans are a good form of debt; they help build your credit when you begin making payments on them and allow you to develop a credit history. The same goes with a car loan, or a mortgage. Your limits aren’t going to be high, but these accounts will allow you to build up your credit score and history over time.

Consider store cards

Like the catalogue accounts, you can also apply for gas-station cards, or store financing with a local boutique shop where you live. These accounts are typically easy to get an approval, and once you start making payments, you’ll have some credit history attached to your name.

Consider a cosigner

If you have a parent, or relative that is willing to cosign on an account, who has great credit history and a high credit score, this is a great option as well. Oftentimes you are going to be approved for an account, you start making the payments, and this will help build up your credit score as well.

Even if you don’t have any open accounts and are new to obtaining credit, you can build up your credit score relatively quickly if you take the right approach and steps in doing so. These are a few simple tips anyone can utilise, which will not only help increase the score in a short period of time, but will lead to quick approvals of new accounts, and invitations to new accounts, in no time at all.