How to Build Credit without a Credit Card

1. Pay student loans diligently. If you’ve got a college degree, you probably have at least some student loan debt. Student loans are reported to the credit bureaus, so making your student loan payment on time every month can help build your credit.
2. Take out an auto installment loan. Vehicle loans are among the easiest types of loans to obtain, although the interest rate and terms can vary greatly depending on who underwrites the loan for you. If you are planning to buy a vehicle, shop around for the best possible deal, secure the loan and make the agreed-upon payments on time every month. If you have trouble finding a loan on your own, you may need a co-signer to share responsibility for the payments. Other types of installment loans will also help you with builidng credit history, such as mortgages and personal loans.
3. Obtain a secured loan. Banks and credit unions understand it’s not always easy to build credit when you’re starting out with little credit history or negative marks on your credit report. Some offer credit-builder loans, or passbook/CD loans — low-risk loans designed specifically to help you build credit. They work much the same way a secured credit card works; for a credit-builder loan, you deposit a certain amount into an interest-bearing bank account and then borrow against that amount. The deposit is your collateral, and you’ll pay interest at a higher rate than your deposit earns it.
   For passbook or CD loans, some banks allow you to use an existing bank account or certificate of deposit as collateral for the loan. Before you take the loan, confirm with the lender that your on-time payments will appear on your credit report.
4. Non-profit lending circles. Organizations such as the Mission Asset Fund (MAF) and its non-profit partners have been gaining popularity and have expended across the nation by providing low-income borrowers a way to get financing while building credit. Organizations such as these can provide affordable loans and report positive payment history to the credit bureaus.
5. Ask for credit where credit is due. Just because you’ve never had a loan or credit card doesn’t mean you don’t know about paying bills. If you reliably pay your rent and utilities on time, you’ve demonstrated good money management habits and you can ask for credit for that good track record.
   Rental payments and utility bills don’t typically appear on a credit report — unless you fail to pay and the leasing company or service provider sends the delinquent amount to a collection agency or files suit against you to recover the past due amount. However, recently some companies have been taking steps to change that. Experian was the first to include positive rental payment information on its credit reports, so you can ask your landlord to report your positive payment history to the credit bureaus.
   Experian also offers an Extended View score, which incorporates information from public records and sources beyond credit reports to help give lenders a more complete picture of an individual’s money and credit-management habits. If you’re having trouble getting approved for an auto loan, for example, you can ask the finance company to request an Extended View score from Experian.