How do you begin to establish credit?

Establishing credit is often a Catch 22. It is difficult to access credit if you don't have credit history and you can't build a credit history without access to credit.

For most consumers, a credit card is the easiest way to establish your credit history. Student credit cards are a great starting point since they often have lower credit requirements and are designed to help establish credit. Secured credit cards are another option since they have 100% approval but require a security deposit and can often have high fees.

A second way of establishing credit is to have someone with good credit co-sign a loan for the person without credit. Remember that the co-signer is guaranteeing the loan and will be responsible should the borrower default.

Back to All Credit Q&A