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How Do You Build Credit Without a Credit Card?

October 12th, 2022 | 6 min. read

How Do You Build Credit Without a Credit Card?

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So you’re ready to establish or build your credit score and are looking for ways to do it? In your credit building research, you’ve probably come across the recommendation to open a credit card.

On one hand, credit cards can help you build credit, earn rewards and access exclusive benefits, and provide you with extra cash flow when you don’t have the money at your disposal.

On the other hand, a credit card could hurt your credit score, your credit history, and your wallet if you used too much of your limit, carry a balance and rack up interest charges, or miss a payment. 

Since this financial tool comes across as a blessing if used properly and a curse if misused, you may want to avoid credit cards altogether. 

Luckily, when building credit, it doesn't have to be with a credit card! There are other ways. 



I know you want to go about building credit the right way since credit affects your everyday life. While many people are concerned about building credit to have better approval odds on their next loan, having good credit affects more than just future loan rates. Other than acquiring another tradeline, having good credit affects:

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  • Where you live: Landlords look at your credit history when you apply. It tells them whether or not you’ll default on paying your rent. 
  • Your employment: Some employers (not all) look at your credit to see how you handle large sums of money.
  • Your utility bills: Your utility bills are not loans, but it could affect your credit score should you fail to pay your electricity or gas bill. If you have a bad credit history, you could be required to put down a deposit or have a cosigner set up your utility account. 
  • Your auto insurance rate: Auto insurance companies look at your credit history to determine your insurance risk score. So, if you have a good credit score, you could pay less for insurance.   

Now that you know what a good credit score is good for and how it can affect you, here are some actionable steps to take to boost your credit score without using a credit card.


Tools-Iconhow do i build credit without using a credit card? 



Whether it's an auto loan, credit card bill, mortgage, or any other tradeline, paying your current creditors is a great way to build your credit. The notion of getting a loan and paying your monthly balance when it’s due gets reported to the credit bureau, which goes towards your credit history.  


QUICK TIP: If you’re making monthly payments on revolving credit accounts like an existing credit card, make sure you don’t use more than 30% of your credit utilization. Keep your balance low. Your credit utilization is the amount of credit you're spending in comparison to the amount of credit you have available). Psst… that utilization ratio helps make up 30% of your credit score


become an authorized credit card user

Say you have a loved one who has a credit card, you could be added to their card as an authorized user. Once you're an authorized user, you get a card too and make charges, but since your loved one is the owner of the card, they are the one who is ultimately responsible for the account and the one to repay the lender. (Just make sure your loved one is comfortable with adding you to their card and you work out an agreement to pay them back for your charges before you start swiping!)

Once you're added, activity will be reported to the bureau, and positive activity can help boost both of your credit scores. Woohoo!


Get a secured credit card

I know, I know… the point was to list ways to boost your credit score without a credit card but hear me out.  A secured credit card works a little differently than a regular - or unsecured - credit card. If you were looking for ways to boost your credit score because you couldn’t get approved for a regular or unsecured credit card, then a secured credit card is your best bet! This credit card was created for anyone looking to build or establish their credit - so it’s perfect.  You just need cash as your collateral to open the account. Here’s more on secured vs. unsecured credit cards. 


apply for a credit builder loan

Financial institutions offer credit builder loans that hold $500 - $1000 in a special account, and you would pay the amount back to the institution to access the proceeds. This gives you a chance to make monthly on-time payments and establish credit or rebuild it.

QUICK TIP: Skyla offers credit builder loans. We call it "No Score". Interested? Give us a call at 704.375.0183, or visit any of our branches where our Customer Service Representatives will be happy to help. 



ready to get your credit score on track?

Now that you know what to do and don't need a regular credit card to do it, it’s time to get your credit score on track. And you're not alone here. Many people look for ways to rebuild or improve their credit scores. Using another loan to do it can help. When it comes to your existing loans make sure you do the following to help your credit score.  

  • Pay On-Time: Missed or late payments can have a major negative impact on your score. A 30-day late payment could decrease your score by 60 points.
  • Get Current: If you’re behind on your payments, get current and try to stay current. Your score should increase the more you’re on time.
  • Keep Balances Low: On revolving credit, such as a credit card, make sure to keep your balance low. You should also try to keep your utilization under 30%.
  • Be Responsible: Credit cards and installment loans help build credit, but lenders need to see a score that reflects responsibility. Don’t open a line of credit unless you’re confident you can manage it.

Learn More About Credit Scores



If you have any questions or comments, our Customer Service Representatives are here for you. You can send an email, give us a call at 704.375.0183, or visit any of our branches




As the Content Specialist and author of the Learning & Guidance Center, Yanna enjoys motivating others by uncovering all that's possible in the world of finance. From financial tips and tricks to ultimate guides and comparison charts, she is obsessed with finding ways to help readers excel in their journey towards financial freedom.

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