Limited or No Credit History

Know Your Credit

Getting an unsecured card can be somewhat difficult when you have no credit or a limited history. The inability to determine the risk is what scares away the issuer, but a little knowledge may be a big step towards an approved application. First of all you can eliminate 95% of the credit cards, because most major card issuers does not accept someone with a bad score or no history at all. There are some companies that do have offers for those individuals in that situation, but be prepared to pay an annual fee, higher interest rates and do not expect any rewards program to be included.

When you open the account it is vital to know how credit works, otherwise it can get very expensive. Each month you will receive a statement and that balance must be paid on time each month. There is a grace period of about 20 days where no interest is accrued, but after that point the interest will be applied to any remaining balance. The most important thing is paying on time, whether it is the full or minimum amount because on time payments is reported on your credit history and has a positive effect. Late payment fees and default APR are two more good reasons to have your budget under control.

You have every reason to upgrade your card as soon as possible, but it is going to take some time before major issuers are willing to take on the risk. Be patient and wait for at least 9 months until the exchange, and if your first application is denied do not try a second time. Every time you submit an application it is also reported on your credit history. Numerous attempts can be seen as desperation, so it is better to wait 2-3 months before trying again.

Your credit score is not a secret number and is easily accessible from any of the 3 major credit bureaus for a small fee. They will each give you a different score, however unless there is an error on your report the numbers are going to be almost identical.