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2 Ways to Build Credit Without a Credit Card

Building Your Credit

After bankruptcy, one of the first things people want to do is get a credit card. However, it can sometimes be difficult to get a credit card with a low interest rate.

Luckily, there are some things that you can do to build credit without a credit card. Once you’ve established a basic record of using credit, you should get credit card offers with lower interest rates.

When you are building your credit score, one thing that matters is paying your bills on time and managing your money wisely. Making late payments on your rent or utility accounts may not show up on the big three credit reports, but they will if you delay in making payments for so long that it’s reported to a credit agency.

Here are some credit-building options for you:

Installment Loans

Essentially, you are lending $1,000 to yourself. Depending on the lender, you either pay $1,000 into an account as a lump sum or by making deposits over time. When the entire amount is in your account, you can then take out a line of credit for $1,000 with your deposit as the collateral. You can borrow and repay against the line of credit, and your timely payments will show up on your credit record.

CD Loans

If you have a CD or savings account, your bank may let you use that as collateral for a loan. Some lenders will let you borrow up to 100 percent of the amount in your account, while others restrict the amount. You will pay a small fee plus interest, and you won’t be able to touch the CD or savings account until the loan is paid back. However, your payments will show up on your credit report as a secured installment loan.

If you are overwhelmed by bills and are considering bankruptcy, call us today at 816-842-6200 to speak with an attorney. Or you can email us and schedule your free consultation.


Jason C. Amerine
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President and Owner, Castle Law Office of Kansas City
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