How to Start Credit Without a Cosigner

You need a credit history to qualify for loans, credit cards and other accounts. Banks and companies use your past performance to evaluate you for new credit. It is tricky to start your credit history because you have no track record. You can get a family member to co-sign for you, but this isn't necessary. There are ways to establish a credit file on your own.

Instructions

1

Open a checking or savings account at a bank or credit union, the Money Matters financial website recommends. This shows creditors you are fiscally responsible because you have money to save or are able to manage your spending with checks.

2

Apply for a branded gas company or store credit card rather than a Visa, MasterCard, Discover or American Express card. Gas companies and retailers are usually more willing to take a chance on a young person than the major credit card issuers, Money Matters explains.

3

Use your gas card or store account for six months to a year. Make small purchases and send in your payment immediately. FICO, the largest credit score company, explains that your repayment history accounts for more than a third of your score. Every on-time payment makes you more attractive to major credit card issuers.

4

Apply for a Visa or MasterCard once you've used your gas or store card for six to 12 months. Do this with your current bank or credit union if it offers credit cards. You have a better chance of being approved if you have an established relationship with the issuer.

5

Use your Visa or MasterCard responsibly. Other lenders want to see activity on your credit report so you must make regular transactions. Don't overspend because FICO warns late payments will seriously damage your credit score. Missteps are especially dangerous when you're just starting out because your file won't have a positive history to offset negative items.