A family member or significant other may be willing to add you as an authorized user on his or her card. Doing so adds that card's payment history to your credit files, so you'll want a primary user who has a long history of paying on time. In addition, being added as an authorized user can reduce the amount of time it takes to generate a FICO score. You don't have to use — or even possess — the credit card at all in order to benefit from being an authorized user.
Ask the primary cardholder to find out whether the card issuer reports authorized user activity to the credit bureaus. Rent-reporting services such as Rental Kharma and LevelCredit take a bill you are already paying and put it on your credit report, helping to build a positive history of on-time payments.
Not every credit score takes these payments into account, but some do, and that may be enough to get a loan or credit card that firmly establishes your credit history for all lenders. Experian Boost offers a way to have your cell phone and utility bills reflected in your credit report with that credit bureau. Note that the effect is limited only to your credit report with Experian — and any credit scores calculated on it.
Building a good credit score takes time and a history of on-time payments. Practice these good credit habits to build your score:.
Try to make your payments on time and pay at least the minimum if you can. Paying credit card or loan payments on time, every time, is the most important thing you can do to help build your score.
If you are able to pay more than the minimum, that is also helpful for your score. If you use credit cards, keep your credit utilization low — utilization is the percentage of your credit limit you use.
The lower your utilization, the better it is for your score. Avoid applying for multiple credit accounts close together ; applications for credit can cause a small, temporary drop in your score. Multiple applications can cause significant damage. NerdWallet recommends spacing applications by about six months if you can, and researching the best credit card for your needs before you apply. Establish banking relationships - open checking and savings accounts.
This will not directly establish your credit history, but lenders typically ask for bank account numbers on credit applications. If the account remains in good standing, this can help the lender know that you can responsibly manage money. Be consistent. When reviewing a credit or loan application, lenders look for a stable income source, work history, and place of residence. Apply for a department store card or a gas card.
These may be easier to obtain than regular credit cards and typically have lower credit limits. As you work to build a good score, it's important to avoid these moves. Here are three common mistakes people make that can have a negative impact on credit:. Regardless of whether you are building your credit from scratch or rebuilding a struggling score, regularly monitoring your credit is critical to make sure your efforts are paying off. To keep your eye on your credit reports and scores, consider enrolling in Experian's free credit monitoring tool so you can regularly log in to check on your progress.
You can also get a free copy of your credit reports and scores from Experian. Experian Boost helps by giving you credit for the utility and mobile phone bills you're already paying. Until now, those payments did not positively impact your score. The purpose of this question submission tool is to provide general education on credit reporting. The Ask Experian team cannot respond to each question individually. However, if your question is of interest to a wide audience of consumers, the Experian team may include it in a future post and may also share responses in its social media outreach.
If you have a question, others likely have the same question, too. By sharing your questions and our answers, we can help others as well. Personal credit report disputes cannot be submitted through Ask Experian. To dispute information in your personal credit report, simply follow the instructions provided with it. Your personal credit report includes appropriate contact information including a website address, toll-free telephone number and mailing address.
To submit a dispute online visit Experian's Dispute Center. If you have a current copy of your personal credit report, simply enter the report number where indicated, and follow the instructions provided. If you do not have a current personal report, Experian will provide a free copy when you submit the information requested.
Additionally, you may obtain a free copy of your report once a week through April at AnnualCreditReport. Some may not see improved scores or approval odds.
Not all lenders use Experian credit files, and not all lenders use scores impacted by Experian Boost. Learn more. Editorial Policy: The information contained in Ask Experian is for educational purposes only and is not legal advice. You should consult your own attorney or seek specific advice from a legal professional regarding any legal issues. Please understand that Experian policies change over time. As an authorized user, you can piggyback off the primary account holder's credit and as a result, establish your own credit history.
Authorized users also have zero liability, so this is a low-risk way to build credit. But before you become an authorized user, make sure your family member or friend has good credit and uses their credit card responsibly. You don't want to become an authorized user on an account that has debt or late payment history, since those negative actions will appear on your credit history and counteract any credit building you plan on achieving.
Also, make sure you practice responsible behavior as well. You'll want to make a clear plan for how you'll pay back any purchases you make with the card, so you don't risk wracking up debt on someone else's card. Learn more: What's the minimum age to be an authorized user on a credit card?
Secured credit cards are a great way to build credit if you have none. These cards are typically easier to qualify for if your credit history is poor or non-existent.
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