What's your credit score if you've never had a credit card?

Many of you have asked what your credit score is if you've never had a credit card or line of credit taken out under your name.  The FICO score range is 300-850, so if you've never had any type of credit, your score is in the 300's.  The best thing to do as soon as you turn 18 is to have a small credit card that you pay off every month so that you can start building your credit history.

Having no credit is worse than having poor credit.  Typically, those with poor credit are in the 500 credit score range.  People who have filed bankruptcy are in the low 500's range.  Those who have poor credit still qualify for high APR loans to balance out the risk, but people with no credit cannot get a loan without a co-signer.

If you don't have any credit, the best thing to do is start establishing it now.

Get Your Free Credit Report Today

Per federal law in the United States, each person is entitled to a free credit report from all 3 agencies (Transunion, Equifax, and Experian) once each year.  Companies and websites that provide this free service also make money off of showing more detailed information about your report and score, but if you just want to know the score, you can go the free route.  It's always good to know what's on your credit so that you can take steps for credit repair if necessary.

Here's a link to a site where you can get your credit report: https://www.annualcreditreport.com/cra/index.jsp

Does Adding Tradelines Increase Your Credit Score?

One method people use to boost their credit score (or repair credit) is adding tradelines, which is simply adding other credit accounts (usually credit cards) to your credit report to demonstrate more available credit.  If your ratio of outstanding credit to available credit is low (usually sub 20%), your credit score will not be negatively impacted.

However, when adding tradelines, you must be careful to to add multiple ones in a short period of time.  Opening up multiple credit cards and/or making a big purchase in a few months' span will greatly knock down your score.  Your credit score goes lower because you pose more risk when borrowing more money.  Fortunately, when all of these accounts are paid, your credit score usually increases to be a higher number than it was before.