Building Credits Without Credit Cards

The very key to avoiding the snags people experience through their everyday lives is by building credit. The responsible usage of credit cards is one of the best ways to create and build good credit scores. However, if a person prefers not to use credit cards, then he or she must know how to build credit solely without the use of the said cards.

These alternative methods generally focus on the application of loans for which differ depending on the type of loan convenient and appropriate for the client. And for the rundown, compiled below are some examples of the solutions commonly used by people having this similar situation.

Using credit builder loans

One of the best solutions on how to build credit without a credit card, credit builder loans are loans that are similar to secured credit cards. The funds from the loan are transferred in a saving account until the client was able to repay the loan. The payment history will be included in the credit reports, so the timely payments will help boost the credit score as long as the client was able to make the monthly dues and cause no default to the transaction.

Repay the student loans

Student loans are usually granted up to the standard maximum amount as long as the client is still enrolled in any eligible learning institution. Depending on the type of loan they have, the clients may not be required to start paying until they can finish their academic requirements. But, in building the credit score, the customers can start sooner by paying for the monthly student loans while they’re still studying at their college. However, these individuals should make sure to pay the dues on time and create no default to maintain having a good credit score.

Repay car loans or mortgages

Repaying car loans and mortgages would help any individual build good credit scores because these loans are also reported to the credit bureaus. Also, people mustn’t worry about applying for these loans even without having an established credit history because good down payments and steady incomes would still get people approved.

For the mortgages, if the individual has at least a year of timely rental payments, no accounts other than medical bills, and on-time payments on any other expenses, then he or she could be approved to have a loan with the assurance of the Federal Housing Administration.


Having a good credit history is important for most of the individuals. This comes in handy especially if a person decides to buy a home or a car, obtain a mobile phone, set up new accounts for utility, rent an apartment, and handle other transactions related to finances. Although one of the methods for creating a good credit score is to have a secured credit card, people could still find other alternatives. As such, to answer problems on how to build credit without a credit card, people could apply for any loan that best fits their current financial situation; these loans depend on how it could be convenient and appropriate for the client.

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