How to Build Credit Without a Credit Card

Your credit history determines whether you'll qualify for a mortgage loan and what rates you can get. There are several ways to establish a credit history. And in some cases, you can build a strong credit rating without using a credit card.

Instructions

1

Open a bank account. Credit applicants typically inquire about a bank account, and having a bank account demonstrates your ability to manage finances. Contact a bank or credit union and open a checking or savings account.

2

Apply for an auto loan. Several dealership and auto lenders offer no credit or bad credit auto loans. These are ideal for individuals who want to build credit without a credit card.

3

Consider a small bank loan. Apply for a small bank loan and make timely payments, or pay off the balance within a couple of months. The lender will report this account to the credit bureaus, and this can help you establish a credit rating.

4

Add your name to someone's account. Ask a close relative (with good credit) to add your name to one of their credit accounts. This is a quick ways to build credit without a credit card. Their credit account appears on your report, and you'll establish a rating.

5

Practice good credit habits. Once you've obtained a few credit accounts, building credit involves wise choices. Pay your creditors on time to maintain a high rating. If possible, submit early payments.