Credit Cards or Installment Loans for Building Credit (no credit history)

[Ahava18]

Hi everyone,

I’m looking for suggestions on the easiest credit cards or installment loans to get approved for when you’re starting completely from scratch. Tried applying for a couple of credit-building cards like the Petal 2, but unfortunately wasn't approved.

Entry-level products are totally fine, preferabley no Secured cards or only those where the deposit isn’t locked up for too long. Just looking for something to begin establishing a score.

If anyone has recent experience or recommendations for lenders, CU, etc. who are friendly to people with no credit, I’d really appreciate the help.

Thanks in advance!

[pizzadude]

If you have absolutely no revolving credit history then it will be difficult to get approved, so secured cards aren't a bad option in this case.  

Do you have any credit history at all ?   Are you an authorised user on anyone else's cards or could you be added ?

[coldfusion]

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@pizzadude wrote:

If you have absolutely no revolving credit history then it will be difficult to get approved, so secured cards aren't a bad option in this case.  

Do you have any credit history at all ?   Are you an authorised user on anyone else's cards or could you be added ?

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+1 to all of the above. 

Being added as an authorized user on a card held by someone with a good credit profile will at least get a credit profile started.

However, a secured card from an issuer like a Discover IT Secured card is IMO a better choice because a) the reporting will also reflect your own payment history b) with Discover you can check for a preapproval for the secured card before you apply c) Discover (and Capital One) has historically been friendly toward applicants with thin credit profiles d) you can get a card with a $200 security deposit  e) with a good usage and payment history the card can graduate to an unsecured card, sometimes in less than a year.

[Thomas_Thumb]

Revolving CC accounts provide more credit score bang for the buck.

Get a $300 or $500 secured credit card to start the credit building process. Then, after 6 months Fico will generate a credit score for you. Likely initial reporting score will be in the 670-680 range - assuming you use the card and Pay monthly statement balances in full.

Side note: For a good score you need to ensure reported statement balance is less than 29% of the card's credit limit. So, if your card has a $500 CL, keep reported balance under $145.

You can charge $300 or $400 on the card during a month. The key point is to make a interim progress payment so statement balance is under $145. Then pay the statement balance in full before due date.

Once you have a credit score you could make a small, say $100, purchase using Affirm's 0% interest 4 payment BNPL. The 4 bi-weekly payments can be auto charged to your credit card or set-up to pay from a checking account. This can generate installment loan history - assuming Affirm reports the account (Klarna does not report). I think this may be a simpler approach than a credit builder loan. Just avoid any late payments! 

[GZG]

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@Ahava18 wrote:

Hi everyone,

I’m looking for suggestions on the easiest credit cards or installment loans to get approved for when you’re starting completely from scratch. Tried applying for a couple of credit-building cards like the Petal 2, but unfortunately wasn't approved.

Entry-level products are totally fine, preferabley no Secured cards or only those where the deposit isn’t locked up for too long. Just looking for something to begin establishing a score.

If anyone has recent experience or recommendations for lenders, CU, etc. who are friendly to people with no credit, I’d really appreciate the help.

Thanks in advance!

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chase freedom rise, easily should be approved with a bank account with some money in it

[SouthJamaica]

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@Ahava18 wrote:

Hi everyone,

I’m looking for suggestions on the easiest credit cards or installment loans to get approved for when you’re starting completely from scratch. Tried applying for a couple of credit-building cards like the Petal 2, but unfortunately wasn't approved.

Entry-level products are totally fine, preferabley no Secured cards or only those where the deposit isn’t locked up for too long. Just looking for something to begin establishing a score.

If anyone has recent experience or recommendations for lenders, CU, etc. who are friendly to people with no credit, I’d really appreciate the help.

Thanks in advance!

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I agree with @pizzadude @coldfusion and @Thomas_Thumb 

Get yourself a good secured card