How to Build Credit Without a Credit Card

Get Car Financing
Even with poor credit.

By

Megan Foukes is a recent graduate from Indiana University who graduated with a bachelor’s in journalism. Megan works as a content writer for Auto Credit Express and contributes to several automotive and finance blogs.


, - May 3, 2018

Not everyone is comfortable with or ready to take on a credit card. Even though having a credit card is one of the best ways to build credit, it’s not the only way.

Three Ways to Build Credit

A consumer’s credit score can affect many large purchases in life, such as buying a house or car. If a consumer finds themselves with no credit built up, it can make getting approved for financing difficult. The good news is that there are options to build credit, and a consumer doesn’t necessarily need to take on the responsibility of a credit card to do so.

These are just three different ways to build credit without a credit card:

  1. Become an authorized user – Becoming an authorized user on a family member’s or friend’s credit card account is a great way to build credit without having the account in your name. An authorized user can benefit from the positive activity on the card, but if the primary card holder doesn’t make payments on time, the authorized user’s score will also be negatively affected.
  2. Ask for bill payments to be reported – A consumer who pays monthly bills such as rent, cable, electricity, and gas can sometimes get their payments reported to the credit bureaus. Providers always report missed payments, but in order to get on-time payments reported, account holders will likely need to ask if it’s possible. Not all providers can or will do this. At the same time, if a consumer’s landlord won’t report rent payments, they can use a third-party pay-for-report company to send monthly rent payment activity to the credit bureaus.
  3. Take out a loan – There are multiple types of loans a consumer can take out. Specific loans such as small personal loans or credit-builder loans are perfect for borrowers who are looking to improve their credit. If a consumer needs a car, in many cases, they can finance one and build up credit by taking out a subprime auto loan and making on time payments.

Bottom Line

Although getting one is highly recommended, a credit card isn’t required to build credit. There are other options that can work just as well.

If you're in the process of building credit and want to apply for a car loan, CarsDirect wants to help you find financing. We work with a nationwide network of special finance dealerships that have the lenders available to handle unique credit situations. Get started today by submitting our secure auto loan request form.

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Megan Foukes is a recent graduate from Indiana University who graduated with a bachelor’s in journalism. Megan works as a content writer for Auto Credit Express and contributes to several automotive and finance blogs.


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