Eli5: how people initially start building credit.

1.02K viewsEconomicsOther

It’s weird to me. I recently applied for a bunch of rentals and my lack of credit has been the main thing holding me back. I have resolved to get a secured credit card but like how tf do people usually build credit anyway? I got denied by several other credit cards.

I also tried to apply for a loan earlier last year for a tow behind camper and even with 10k down on a 16k camper they said no. It’s like they can’t comprehend what I mean when I said I don’t have a credit score…it’s not a bad credit score….it’s that I have literally zero history. I’ve paid for everything in full including my car and the travel trailer that I ended up buying and yet I’m punished for it.

Anyways, how do most people get their name in the system? Is it always with a secured credit card?

In: Economics

20 Answers

Anonymous 0 Comments

You build credit by borrowing money and then paying it back.

Of course, this means finding someone willing to lend you money in the first place.

Some banks, for example, are willing to give (unsecured) credit cards to college freshmen, knowing that the odds of being paid back are sufficiently good to make this work despite the college freshmen are all young kids without any credit history.

You are viewing 1 out of 20 answers, click here to view all answers.