Writer: Ashley Fricker
Editor: Lillian Guevara-Castro
Reviewer: Jon McDonald
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Many consumers use starter credit cards to build their credit history without the upfront cost of a secured credit card. These cards provide you with a revolving line of credit without needing a refundable security deposit to activate your account.
Choosing a well-known credit card issuer for your starter card can lead to exciting opportunities. As you build your credit, you might qualify for an upgrade, taking you further on your credit journey.
The best part is that you can apply for any of these cards online and receive a credit decision within a matter of seconds. That means you can qualify for your starter credit card before you even get out of bed in the morning.
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Best Overall Unsecured Card for No/Limited Credit
The Capital One Platinum Credit Card is the bank’s entry-level offering and is a great starter card for anyone who is serious about building credit. Not only does the card charge almost no fees and a competitive interest rate, but your responsible credit behavior may also help you qualify over time for one of Capital One’s many rewards credit cards.
- No annual or hidden fees. See if you're approved in seconds
- Be automatically considered for a higher credit line in as little as 6 months
- Help build your credit through responsible use of a card like this
- Enjoy peace of mind with $0 Fraud Liability so that you won't be responsible for unauthorized charges
- Monitor your credit score with CreditWise from Capital One. It's free for everyone
- Get access to your account 24 hours a day, 7 days a week with online banking from your desktop or smartphone, with Capital One's mobile app
- Check out quickly and securely with a contactless card, without touching a terminal or handing your card to a cashier. Just hover your card over a contactless reader, wait for the confirmation, and you're all set
- Pay by check, online or at a local branch, all with no fee - and pick the monthly due date that works best for you
- Top rated mobile app
Capital One will monitor your account every six months to see whether you qualify for a credit limit increase. If you qualify, the bank will automatically boost your spending limit without any additional fees or charges.
- Earn unlimited 1.5% cash back on every purchase, every day
- No rotating categories or limits to how much you can earn, and cash back doesn't expire for the life of the account. It's that simple
- Be automatically considered for a higher credit line in as little as 6 months
- Enjoy peace of mind with $0 Fraud Liability so that you won't be responsible for unauthorized charges
- Help strengthen your credit for the future with responsible card use
- Earn unlimited 5% cash back on hotels, vacation rentals and rental cars booked through Capital One Travel
- Monitor your credit score with CreditWise from Capital One. It's free for everyone
- Check out quickly and securely with a contactless card, without touching a terminal or handing your card to a cashier. Just hover your card over a contactless reader, wait for the confirmation, and you're all set
- Top rated mobile app
The Capital One QuicksilverOne Cash Rewards Credit Card is the cash back sibling of the Platinum card listed above. This card lets you earn unlimited cash back on every qualifying purchase in exchange for a small annual fee.
By ensuring you pay off your balance in full each month, you’ll avoid interest charges, allowing your rewards to exceed the annual fee. Spending $217 monthly on your card can help achieve this.
Best Student Cards for No/Limited Credit
These cards are specifically for students starting their credit-building journey. They offer similar benefits to cards for good credit, plus unique student perks.
The Discover it® Student Cash Back offers generous cash back rewards (subject to a purchase limit) in quarterly rotating categories that you must activate.
You’ll be charged a competitive APR on balances that aren’t paid off each billing cycle, and will never have to pay an annual fee.
- Earn unlimited 1.5% cash back on every purchase, every day
- Early Spend Bonus: For a limited-time, earn $100 when you spend $300 in the first three months
- Enjoy peace of mind with $0 Fraud Liability so that you won't be responsible for unauthorized charges
- Enjoy no annual fee, foreign transaction fees, or hidden fees
- Lock your card in the Capital One Mobile app if it's misplaced, lost or stolen
- Earn up to $500 a year by referring friends and family when they're approved for a Capital One credit card
- Build your credit with responsible card use
- Whether you're at a 4-year university, community college or other higher education institution, this card might be an option for you
- Top rated mobile app
The Capital One Quicksilver Student Cash Rewards Credit Card offers an unsecured credit option for students with perks that fit students’ interests, spending, and lifestyle.
This includes cash back rewards, a competitive interest rate, no annual fee, and a signup bonus.
With the Capital One Savor Student Cash Rewards Credit Card, cardholders can earn elevated cash back rewards on dining, entertainment, streaming services, and at grocery stores. All of which are popular spending categories for young adults.
This card offers generous rewards for a student card, and these rewards can really add up fast. But be sure to pay your bill off each month so the interest charges don’t eat away at your earnings.
Lower-Rated Unsecured Starter Cards
The cards below are all for poor or no credit history. Although these cards are more affordable at first, they may provide you with a smaller credit line until you can prove you can responsibly manage credit.
Many also come with fee structures that may be undesirable if you are on a tight budget.
- Up to $1,000 Initial Credit Limit
- See if you Pre-Qualify with No Impact to your Credit Score
- Less than perfect credit? We understand. The Surge Mastercard is ideal for people looking to rebuild their credit.
- Unsecured credit card requires No Security Deposit
- Perfect card for everyday purchases and unexpected expenses
- Monthly reporting to the three major credit bureaus
- Use your card everywhere Mastercard is accepted at millions of locations
- Enjoy peace of mind with Mastercard Zero Liability Protection for unauthorized purchases (subject to Mastercard guidelines)
- Apply with Confidence! There is no impact to your credit score if you’re not approved. See terms.
The Surge® Platinum Mastercard® is a decent starter credit card. But this card can also help rebuild your credit since this credit card company accepts applications from consumers who have bad credit.
Surge often provides larger initial credit limits to cardholders, but that doesn’t mean you should take advantage of the extra credit. Depending on your creditworthiness, you may only qualify for an interest rate that is higher than most credit card’s penalty APR.
7. OneMain BrightWay® Card
This card is currently not available.
The OneMain BrightWay® Card is an unsecured card with an initially high interest rate, but there’s a silver lining. You can actually work to lower it. By making on-time payments, you might qualify for rewards such as a credit limit increase or a reduced APR in just six months.
You may pay an annual fee to use the card, but it also offers 1% cash back on purchases, so you can earn a little something back while you build credit.
The Reflex® Platinum Mastercard® has an ongoing APR that matches the higher penalty APR of many cards — which can make this a very expensive option if you’re in the habit of carrying a balance from month to month.
But even if you pay your balance in full each month, you’ll still encounter some steep fees with this card. The first year’s annual fee alone is several times higher than the average fee in this category.
But, starting in the second year, you’ll also have to pay a monthly maintenance fee depending on your credit limit that can raise the cost of this card to more than $200 per year.
What is a Starter Credit Card?
A starter credit card is a tool designed to help newcomers establish a credit history. People lacking recent, reliable credit information are often referred to as credit invisible.
This situation is distinct from having bad credit, which involves a history of financial errors. In contrast, having no credit means there’s simply no recorded borrowing history with the credit bureaus.
A starter credit card can be used to add to that history. These are typically no-frills cards that may not provide cash back or other rewards. They may also have a slightly higher interest rate or annual fee to offset the risks associated with lending to someone who has no traceable credit history.
But these cards help you out by reporting your payment and balance history every month to at least one major credit bureau — TransUnion, Equifax, and Experian.
Each major credit bureau collects this information and adds it to your credit file to help build your credit history. Then credit scoring systems such as FICO and VantageScore use this data to calculate your credit scores.
As you might expect, positive information — including on-time payments and a low balance — can help you build a good credit score. Negative information — including a high balance or late payments — will lower your credit score until the debt is paid down.
If you have no credit score at all, you may need up to six months of payments with your new card until you have enough payment history to generate a credit score. Your credit rating will continue to evolve based on your financial behaviors.
Depending on the credit card company you choose for your starter account, you might eventually qualify for a card upgrade.
Larger banks, including Capital One, offer massive portfolios of unsecured credit card options. As your credit score improves and you outgrow your current card, you may be able to move up to a new card with a better interest rate or richer rewards.
That’s something you can’t do with a bank that only offers starter or bad credit cards, making it a key factor to consider when deciding which card to apply for.
How Do I Apply For My First Credit Card?
Most credit card issuers allow you to complete an online credit card application that takes only a few minutes to submit and a matter of seconds to process.
These applications require basic identifying and financial information, including your name, address, phone number, email address, Social Security number, and income details. Some credit card issuers may even require you to link your bank account to their online system to verify your income.
If you’re applying for a student credit card, the bank might pause your application until you can confirm your current enrollment in classes. Typically, they might ask for a copy of your class schedule, your latest semester grades, or a school transcript.
Once you submit your credit card application, you should receive a decision within a minute or less.
On some occasions, the bank may require more information from you before it can make a credit decision, or the bank may need to have a loan officer take a closer look at your application. Other times, you may need to link your bank account online to verify your mailing address or income information.
If you qualify, you will see an approval screen that shows your card’s spending limit and an invitation to sign up for an online account to manage your new card. The credit card issuer will then print your new card and you should have it in the mail within seven to 10 business days.
If you do not qualify for the card, the bank must send you an adverse action notice within seven to 10 business days that details why it did not accept your application. While this is disheartening, do not succumb to the temptation to apply for another credit card right away.
Every time you apply for a loan or credit, the lender places a hard inquiry on your credit report to access your credit history for a credit check. Each inquiry lives on your credit report for two years.
Lenders are typically fine with three or fewer inquiries on your report. But as you start to build up a large number of credit applications, you may see a slight drop in your credit score.
To avoid accruing too many inquiries, consider prequalifying for the credit cards you’re interested in. This is a shortened version of a credit application that will tell you whether you meet the bank’s initial requirements for approval.
When you submit a prequalifying form, you allow the credit card company to conduct a soft credit pull on your file. This gives the bank access to a modified version of your credit file and typically provides enough data for the bank to see whether you are likely to be approved for the credit card if you officially apply
You will not receive a hard inquiry on your credit report for a soft credit pull.
If you prequalify and decide to continue with the process, you can officially apply for the credit card in the manner outlined above. This will add a hard inquiry to your credit report — but that’s not bad if you are likely to qualify for the card.
Prequalifying doesn’t guarantee you’ll receive the card when you apply. Sometimes, the bank discovers something on your full credit report that wasn’t on the prequalified version. In such cases, the bank might revoke its prequalification offer.
In most cases, though, prequalification is a good indicator of success if you decide to formally apply.
Prequalifying can take less than five minutes to complete. The formal application will take a similar amount of time.
What is the Best Credit Card for New Users?
The best credit card for new users is one that allows you to eventually upgrade to a better card and continue your credit-building journey with better terms.
That may mean sticking to an established bank with a large portfolio of credit card offerings. Capital One and Discover all offer great starter credit cards as well as cards that provide rich rewards and fair interest rates.
We’ve rated the Capital One Platinum Credit Card as the best overall card for new credit users. This card will periodically review your account for credit limit increases and eventual upgrades.
As you demonstrate your creditworthiness over time, many credit card issuers will raise your credit limit, giving you more spending power. If you continue to be a responsible borrower, the bank might upgrade you to a better credit card.
If this happens, you may receive a new card in the mail and any balance you have with your old account will carry over to your new card.
You can also contact your credit card issuer to see whether you qualify for a card upgrade. It usually takes six months to a year after opening your current card account to qualify, so consider the timing before calling customer service.
Building credit is a long journey taken in small steps. If you start off with a credit card issuer that does not have a large portfolio of cards, you may have to cancel your current card and apply for a new one when your credit score improves.
When choosing your starter credit card, it’s smart to think about the future. Look into the bank’s card options to see if there’s one you hope to qualify for down the line.
If there’s a specific card you’re aiming to qualify for someday, you can nurture a successful relationship with that bank. If not, it might be wise to explore other options.
What Fees Do Starter Credit Cards Have?
Banks can charge any fees they want to — as long as the fee is legal. As a result, you may find different fee types across the various credit cards available.
An example of some of the types of fees you may find on your starter credit card include:
- Annual Fee: This is a somewhat common fee some credit cards charge to your credit account every year on your account anniversary. The fee can vary from as little as $30 to hundreds of dollars each year for more exclusive rewards credit cards. Some cards charge no annual fee at all.
- Interest Rate Fee: Banks make money with credit cards by charging interest on all of the money they lend out. Interest is calculated as a daily percentage of your card’s balance that is not paid within the card’s purchase grace period.
- Late Fee: Most cards charge a late fee if you submit a payment after the due date. The fee amount will vary by the card you choose. Some banks may also initiate a penalty APR that increases your interest rate after you make a late payment.
- Balance Transfer Fee: Some cards charge a balance transfer fee when you transfer an existing balance from one card to another. A balance transfer may make sense if your new card has a lower interest rate than your old card. This fee is usually 3% to 5% of the amount of debt you transfer.
- Over-Limit Fee: Some banks will simply decline any transaction that attempts to charge more money than your available credit limit. Other cards provide a purchase cushion that lets you exceed your spending limit by a set amount. If you do this, though, you can expect to be charged a fee.
- Cash Advance Fee: Most cash advance fees are around 3% of the amount withdrawn from your credit line. You will also have no grace period for this type of transaction and will start immediately accruing interest charges on the amount you withdraw. Most credit cards also charge a higher interest rate for cash advances than they do purchases.
- Foreign Transaction Fee: If you make a purchase in a foreign country — or one that requires payment in a currency other than your native currency — your issuing bank may charge a foreign transaction fee to convert the amount spent. This is usually a small percentage of the total transaction.
- Returned Payment Fee: You will likely encounter a returned payment fee of $25 to $40 if your check or online bank transfer for a payment bounces due to insufficient funds.
- Card Replacement Fee: If you lose your credit card, the bank will need to freeze your account and print and send you a new card. You may be charged a fee that varies based on the card issuer, but most banks replace cards for free.
Some credit cards offer new cardholders promotional deals that waive certain fees. For example, a card may offer a 0% intro APR for new applicants for a period of between six and 18 months.
Some banks may also offer a balance transfer offer that waives interest charges or balance transfer fees on debt you move from an existing card to your new card. This can be a great way to eliminate debt without incurring heavy finance charges along the way.
For the most part, standard fees — such as a late payment, returned payment, over limit, or card replacement fee — are not covered under promotions and will charge to your account when they apply.
What Credit Card Can I Get With No Deposit?
An unsecured card does not require a deposit for activation and will not require upfront money for approval.
To find the card that best fits your needs, take a look at your current credit score and financial situation. After all, if you have good credit, you shouldn’t waste time on cards meant for those with bad credit.
Your FICO credit score can range between 300 and 850. A bad credit score is any number below 580. A score of between 580 and 669 is considered fair credit or limited credit. You have good credit if you fall between 670 and 739. You have very good credit if you’re between 740 and 799. Any score at or above 800 is excellent credit.
| FICO Score Categories | Score Range |
|---|---|
| Exceptional | 800-850 |
| Very Good | 740-799 |
| Good | 670-739 |
| Fair | 580-669 |
| Poor | Below 580 |
Cards for bad credit will charge a higher interest rate, and will likely have annual fees and other charges that make them more expensive for consumers. Depending on how bad your credit is, you may have to settle for a secured credit card that requires a refundable security deposit for approval.
Cards for fair credit will have slightly better terms than cards for bad credit, including lower interest rates. Some of these cards will also offer cash back and other rewards.
You’ll have a much more robust selection of cards if you have good credit. These cards generally offer low interest rates, solid rewards, lower overall fees, and a higher credit line.
If you have very good or excellent credit, you should have little trouble qualifying for any credit card you want. You can usually find a good rewards card with travel points or cash back and other valuable perks, including a much higher credit line.
And since your credit score ranks among the top compared with those of most consumers, you can leverage your spending power to potentially negotiate fees or improve your rewards structure on new and existing cards.
What is the Difference Between a Secured and Unsecured Credit Card?
While both cards serve the same function at the register, a secured credit card requires a refundable security deposit for approval, whereas an unsecured credit card doesn’t require any deposit.
Secured credit cards are crafted to assist individuals in establishing or rebuilding their credit. They offer an option for those who might not be eligible for a standard unsecured credit card.
But since these consumers may have a history of late payments or defaults, a secured credit card has a mandatory deposit requirement that serves as security for the bank in case the debt goes unpaid.
Unsecured credit cards do not require a deposit for approval. Banks determine an unsecured card’s credit line by evaluating the applicant’s credit history, current debts, and income. A solid credit history and a low debt-to-income ratio will net you a high spending limit.
With most secured credit cards, you can set your own credit limit based on your security deposit amount. For instance, if you put down a $600 deposit, you’ll have a $600 spending limit.
Some secured credit cards start all new cardholders at the same spending limit and allow them to earn credit limit increases over time and with responsible use.
Unsecured cards don’t provide banks with a safety net for missed payments or defaults, making them generally tougher to get if you have very bad credit. However, if you’re new to credit and have no credit history, it’s often simpler to qualify for a basic unsecured credit card that doesn’t need a deposit.
Whichever type of card you choose — secured or unsecured — the bank that issues your card will report your payment and balance history to at least one major credit bureau. This is how you build a credit history and eventually develop a credit score.
If you have financial mistakes in your past, this new information can help push your previous mishaps further down your credit file and give you a fresh start on your financial journey.
Although many consumers think that secured credit cards are not as helpful as their unsecured counterparts, they are indeed a good way to stick to a budget while growing your credit history.
And since many large banks offer both secured and unsecured credit cards, you can potentially work your way up to an unsecured offering as you improve your credit.
What is the Easiest Credit Card to Get Approved For?
Secured credit cards are the easiest credit cards to get approval for because your refundable security deposit makes up for your poor credit history. In fact, many secured credit cards don’t even require a credit check for approval.
But as with most things in the financial world, the easiest does not always equate to the best.
If a bank makes a product — such as a credit card — easy to get, extra fees and charges are often tacked on to make up for that convenience. In the case of a secured credit card, that isn’t just the upfront security deposit.
Even after you put down several hundred — or even thousands — of dollars for your deposit, your new secured card may also charge an annual fee, an account setup fee, or another charge you have to pay before you can use your card.
These fees come directly out of your available balance. Let’s say you open a secured card account with a $400 deposit. This gets you a $400 spending limit.
If your card carries a $75 annual fee due at activation, your available credit will drop to $325 until you pay that fee.
You may also find that a secured credit card has a higher interest rate, late payment penalty, or other fees that can make your credit builder account even more expensive.
With an unsecured credit card, you might face an annual fee and a higher-than-average interest rate, but the absence of up-front costs makes them affordable options for building your credit.
If you have no credit or very limited credit, you’re not likely to qualify for a premium unsecured credit card filled with perks. Instead, you might need to start with a basic card that doesn’t provide cash back or other rewards.
But as you build your credit history and prove your responsibility, you can work your way up to a top-shelf credit card that is worthy of your hard work and determination.
How Can I Get a Credit Card With No Credit History?
Banks understand that everyone has to start somewhere. That’s why they offer entry-level credit cards for folks with little or no credit history. These cards might not have a lot of perks, but they’re a fantastic way to establish your credit and eventually upgrade to more rewarding credit cards.
In many cases, you can check to see whether you’ll qualify for a credit card before you officially apply.
Capital One, for instance, provides a prequalifying tool that takes less than five minutes to complete. You’ll submit basic information, including your name, address, phone number, email address, Social Security number, and income information. The bank will then process that data and conduct a soft credit pull that will not affect your credit score.
In just a few seconds, you can see if you prequalify for a particular credit card. If you do qualify, you’re ready to officially apply. This involves submitting a formal application and consenting to a complete credit check.
The entire process typically takes less than 10 minutes and can return an instant credit decision. Prequalifying for a credit card does not guarantee that you will get the card when you apply, but it is typically a strong indicator of success.
During the prequalifying process, the bank performs a soft credit pull, accessing a modified version of your credit history. The official application will provide the bank with your complete credit report.
Occasionally, your full credit report might reveal something not seen on the modified version. If this occurs, the bank might revoke your prequalifying status.
If you’re approved for a credit card, you’ll see your new card’s credit limit on the approval screen. The bank will then print and mail your card, which should arrive in about seven to 10 business days.
Once you receive the card, you can activate it over the phone or online. Your card is then ready to use.
If the bank rejects your application, you will receive an adverse action notice in the mail within seven to 10 business days. This letter will outline the reasons why the bank did not accept your application and may give you some tips on what you can work on to improve your chances of approval when you apply later.
How Can I Build Credit If I Can’t Get Approved For Anything?
If you’re having trouble finding approval with a credit card company or lender, you may want to retrace your steps to see where the issue stems from. A lender may reject your application for several reasons, but that doesn’t mean you don’t have a way to build credit.
You May Be Setting Your Sights Too High
All credit cards aren’t created equal. Some cards are designed for people who have a good credit score. Others are credit rebuilders for people who have bad credit. If you apply for a card that is a tier or two above your current credit status, you will almost always be rejected.
Instead, focus on your current credit level. While these cards may not be the most appealing, they’re the stepping stone you need to move up to a bigger and better card.
Start With a Secured Card
A secured credit card will require a refundable security deposit that typically matches your credit limit. These cards will report your payment and balance history to each major credit bureau, which helps you build credit. And some of these cards don’t even require a credit check for approval.
Diversify Your Options
If you’re having trouble qualifying for a credit card, consider a small personal loan. While this won’t provide a revolving line of credit like a credit card, it can give you a quick infusion of cash and allow you to show a pattern of on-time payments that credit card issuers will like.
And many online lenders specialize in extending small loans to consumers who have bad credit. And with online lending networks, you can complete the loan process in a couple of hours and have your money by the next day.
Start small With a Credit-Builder Loan
If you have very bad credit and can’t qualify for any of the card options above, consider a credit builder loan from an online financial institution or a local bank or credit union. These loans allow you to essentially lend money to yourself.
When you take out a loan, you’ll make monthly payments, and the bank will report these to the credit bureaus, helping to boost your credit score.
All of your payments will be deposited into a savings account. Once you make your final payment, the bank will report the loan as paid off and remove its fees from the money you’ve paid. The rest of the funds are returned to you. This is a great way to build your credit score and create a small savings cushion at the same time.
Limit Your Applications
It’s easy to succumb to temptation and apply for another credit card as soon as you receive a rejection from another. But doing that can hurt your credit score even more. Every time you apply for a loan or credit, the lender will run a credit check that places a hard inquiry on your credit profile.
Each inquiry stays on your credit file for two years. A few inquiries are okay, but having several can slightly lower your credit score.
Facing rejection is tough. When you’re frequently told “no,” it might feel as if building credit is out of reach.
Sometimes, the most effective route to success isn’t the most glamorous. You might need to begin modestly and aim a bit lower. Doing so can lay the groundwork for a more secure financial future.
What is the Fastest Way to Build Credit?
It’s easy to be impatient when you have big plans and goals for your future. Those goals may require a credit score that’s better than what you currently have. And while you may want to get there fast, banks want to see that you are a responsible borrower over a long period.
You’ll build credit fast by adding positive information to your credit history. That means maintaining on-time payments and low balances.
Many people think good credit means you make all of your payments on time, and while that’s part of the equation, keeping a low balance can be just as beneficial. Approximately 30% of your credit score is based on how much debt you have. Banks look at your credit utilization ratio to determine your debt.
You can calculate your credit utilization ratio by dividing the sum of your debts by the total amount of credit available to you. For example, a credit card with a $1,000 credit limit and a $500 balance has a credit utilization ratio of 50% — in other words, you’re utilizing 50% of your available credit.
Banks like to see a credit utilization ratio of below 30%. If you’re above that number, you may see a significant drop in your credit score.
While the amount you owe accounts for 30% of your credit score, you can still build credit fast by focusing on the other 70%.
- Payment history (35%): It doesn’t matter how large your payment is, only that it was made on time. Consistent on-time payments are the fastest way to build a positive credit history.
- Length of credit history (15%): There’s no way to speed this one up. Banks like to see that you have long and successful relationships with lenders. A general rule of thumb is that seven years is a good length of credit history.
- New credit (10%): Banks get scared if they see an applicant who has submitted several credit applications in a short period. Keep the number of inquiries you make low.
- Credit Mix (10%): Banks like to see a consumer who can juggle multiple types of debt. Beyond credit cards, a car loan, home loan, student loan, or personal loan increases your mix of credit. While you may think you can supercharge your credit-building journey if you add to your credit mix, adding new credit also increases your debt-to-income ratio.
Don’t take on new debt in the name of increasing your credit score. That rarely works. Instead, take the long-view approach and live within your means. Doing so will get you meaningful credit score gains that stick with you forever.
Plus, this builds good financial habits.
How Long Does it Take To Build Credit From Nothing?
If you have no credit score, it can take as long as six months with a starter credit card to generate your first FICO credit score, which is used by more than 90% of lenders to make credit decisions.
The process takes this long because each credit bureau wants to see that you have a consistent pattern of on-time payments. After all, one or two on-time payments can be an anomaly. But stringing together six months of positive payment history shows that you’re responsible and serious about handling and building credit.
Just remember that you can also build a negative credit history within those six months. Even after five months of on-time payments, a late payment during your sixth month can tank your credit score.
Lenders report payment and balance data to each credit bureau once a month. Your late payment will not show up on your credit history — or affect your credit score — until it is at least 30 days past due.
Late payments can be reflected on your credit file as 30-days late, 60-days late, or 90-or-more-days late. The longer you go without making a payment, the more it hurts your credit score. But a 30-day late payment can shave as many as 100 points off your current credit score.
When you generate your first credit score after approximately six months, your new score will likely change each month as you continue to add information to your credit file. Positive items will raise your credit score and negative items will lower your score.
What Credit Score Do You Start Off With?
Many people believe you start out with a credit score of zero and have to work your way up to the desired 800 range. This isn’t true. In fact, it’s impossible to have a credit score of zero.
Your FICO credit score will range between 300 and 850. But, even then, you will not start out with a score of 300. Credit newcomers start out with no score at all because they do not have enough reliable information on their credit file to generate a credit score.
Your first credit score emerges once you’ve established consistent financial habits. This usually happens about four to six months after you receive your starter credit card.
By making on-time payments, you’ll begin with a credit score in the fair credit range (usually in the low 600s). However, if you miss payments during the early months with your new credit card, you might start with a bad credit score (below 580).
Although credit scores and reports may seem confusing, the power is in your hands to determine your score. If you make on-time payments and keep your card balances low, your score will continue to grow, and you will have access to more lucrative and more affordable credit products in the future.
Research Starter Credit Cards With No Deposit Online
Building credit is a marathon, not a sprint. And when you’re on starting blocks, the finish line may look very far away.
But that just means you have time to build your credit history the right way. That means finding the right starter credit cards with no deposit, keeping your balances low, and making all of your payments on time.
If you do that, you’ll run the best race of your life — and, eventually, reach the finish line with a lot to be proud of.
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