How to Build Credit

Author Chandler Sullivan
May 24, 2022 | 11 Min. Read

Knowing how to build credit is something everyone will need to learn in their lives. Credit reports and scores are used in a variety of decisions like getting a mortgage or buying a new car.  When you have little to no credit or a low credit score, it can be difficult to get approved for a credit card, loan, and even renting an apartment.

These important factors may have you thinking about how to build your credit as quickly as possible. Although there is no fast fix to getting credit up, there are many ways you can start building, improving, and maintaining your credit score.

What is a Credit Score?

Credit may be a confusing topic to understand if you have limited experience dealing with credit. To understand credit a little more before reading about how to build credit, you may want to check out our blog topic Understanding Credit.

A credit score is a personalized, three-digit number that evaluates your history of borrowing and likeliness to pay back debt. Scores typically range from 300 to 850.

Is 600 a good credit score?

Lower scores mean more risk. In general, scores between 300-626 are considered poor credit. Good credit is considered 690 and above, with 720 being a score to aim for.

There are many rewards for managing your debt properly but it is completely normal to be in a poor credit spot. Good credit comes with time and proper management. Just because you have poor credit now, doesn’t mean it will be that way forever.

Credit Score Ranges

Types of Credit & Credit Bureaus

There are 3 different types of credit you can encounter.

  • Revolving credit: These accounts have set credit limits you can borrow, pay back, and borrow again. This is most often seen in credit card accounts.
  • Installment credit: These are often personal loans, student loans, car loans, and mortgages. These credit accounts let you borrow and pay back in fixed installments, usually monthly payments.
  • Service credit: These accounts are usually for service and bills you pay monthly i.e. utility and wifi bills.

The 3 main credit bureaus are Equifax, Experian, and TransUnion. A credit bureau is a company that gathers various information on you and your financial history. This history is then turned into a credit report which is the basis for your credit score. You can often see these reports grouped together but they are separate companies. Although these are the largest and most common bureaus that collect this information, they aren’t the only bureaus out there.

Establishing Credit from Scratch

There are many people who have yet to establish credit, especially those who are younger. Some people have been introduced to credit automatically with credit cards or student loans but how do you get credit if you have none? It may sound hard if you have no idea where to start, but it is certainly possible to establish history from scratch.

Here are some ways you can establish credit with no history:

Become an authorized user

An authorized user is an added account to an existing credit card account. The authorized user is able to use the credit card without actually being responsible for payments. The card’s history will be tracked and reflected in your own credit report. As long as the account holder is making on-time payments, you should see your credit score increase.

Find a co-signer

Co-signers make it possible to get a loan or credit card because they are used as a backup to help with payments. Make sure your co-signer understands their responsibility to pay the bill in the event you don’t pay.

Get a credit-builder loan

Credit builder loans, like Marine Credit Union’s Get Credit, are specifically meant for people with no credit history. This loan is specifically there to help report your debt history to the credit bureaus so that you can start building your score. They are often offered at local banks or credit unions.

Experian Boost or UltraFICO

Experian Boost takes your utility, streaming, and other bill accounts, and adds the on-time payments to your Experian credit report. UltraFICO adds information about your bank account, cash flow, and transactions. Keep in mind that not every lender uses these bureaus or scores.

Get credit for bills you pay (if you don’t already)

Your credit isn’t automatically tracked through your utility or Wi-Fi bills. You can request these items be tracked through Experian Boost. Additionally, rent reporting services can add your on-time payments to your credit report.

How can you build your credit fast?

The main ways to build and improve credit rely on behavior changes, resources, and time. You can build your credit score rather quickly when you have a lower score because there is a lot of upside to small changes that can lead to a greater score increase in a shorter time period. Although it can be possible to build your credit fast, it will take a lot of consistency.

Can you build your credit in 30 days?

In short, it is unlikely you will be able to get your credit score to drastically improve in 30 days. While you can increase your score by over 100 points (especially when you have a lower score), it probably won’t happen in just 30 days. But since credit scores are evaluated month to month, you are likely to see improvement in this comparison.

How to Build Credit With a Credit Card

*Marine Credit Union does not offer credit cards.

If you already have some established credit and a steady income, a credit card may be a good option to continue to build and maintain credit. Credit cards are exactly what they are named for– to have credit. They are the most common form of credit usage.

Here are ways you can increase your credit score with a credit card:

Find a card that fits you

A secured credit card is made to help people build their credit. A secured credit card has a smaller credit limit than a regular credit card which makes it a good alternative to having a regular credit card. You can learn to borrow and repay on your own deposit limits.

Find a good first-time credit card

Consider what cards are at your disposal with your current credit score. They may not have all the perks or interest rates you want but as your score goes up, you can always get a new card with more perks with a higher score. Nerd Wallet is a good place to compare credit cards.

Pay off the lowest balance first

Paying down debt is something that is important when reducing overall debt. It is strategic to pay down the lowest balance first but paying down any existing debt is better than nothing.

Request a credit limit increase

As your limit goes up, your balance stays the same and your utilization goes down. Sometimes asking for a credit limit increase is an easy way to instantly improve your score. If you have good payment history, are a long-term member, or have any increase in income, you may be approved for a credit limit increase.

Consistent, low credit usage

When it comes to using credit cards, it is important that you keep your usage consistent but low. Lenders like to see that you have active use of credit, no matter how small, but prefer to see that usage under 30% of your credit limit.

How to Build Credit Without a Credit Card

Although credit cards are a good way to build your credit, there are other options to consider when looking to build your credit. Any current accounts that you have established credit in can be used to boost your score. Many of the suggestions for building credit with no credit history can be applied here as well.

Here are ways you can increase your credit score without a credit card:

Paying existing loans

When you already have existing debt, it is important to focus on paying it down in full or paying the minimum amount when required. By paying off existing loans, you are showing lenders your ability to manage your current debt.

Installment loans

As mentioned as one of the types of credit, an installment loan is a set amount you pay back in monthly payments.

Lending assistance

The Mission Asset Fund is a nonprofit that specializes in borrowing and credit-building through peers that lend to each other. It is a type of community-building effort that has helped many people build their credit while helping others do the same.

Authorized user

Again, as an authorized user you have all the benefits of using a credit card without actually having to pay the credit bill.

Get Credit is a simple way to build your credit while building a secure bucket of cash. In this program, you will choose your monthly payments – to yourself, and then cash it out at the end. With the on-time payments, your credit score will improve and so will your savings.

MCU employees are ready, educated, and willing to help you out with any of your credit concerns. If Get Credit is of interest to you, you can enroll here.

Get Credit Logo

How to Maintain Good Credit

Practicing good credit habits will always be the best way to maintain good credit in the long run. Credit maintenance is a long-term journey that has highs and lows. Over 70% of your current credit score weight comes from the past 2 years alone. Although you can probably increase your score by 100 points in a moderate time frame, it takes about 24 active months of good-decision making before you see any drastic changes.

Here are some good credit habits you can be doing during that time:

  • Budgeting
  • Paying bills on time
  • Reducing your credit usage (30% or less)
  • Paying down your debts
  • Disputing credit errors
  • Not applying for multiple credit cards within a 2-year time frame
  • Communicating with creditors                  

It is important to stay educated on how credit works and what may affect your score. Checking your credit score on a monthly basis will help you keep track of what is increasing or decreasing your score.

Things to Watch Out For

FICO Score vs VantageScore

FICO score and VantageScore are two different credit report scores with their own reporting. 90% of the top lenders use FICO Scores. Other scores that are used, like Vantage Score, can differ up to 100 points from FICO. This is why it is important to understand what score you are monitoring, what score your lenders are looking at and what credit bureaus are looking at FICO scores.

Since FICO scores have been the standard for a long time, it is a good idea to always refer to these scores when keeping up with your credit. If you look at different scores, you can be misled about your creditworthiness. That is because the ranges of poor, fair, good, and excellent credit scores can range quite a bit from each credit score company.

The other commonly known credit score is VantageScore. VantageScore was jointly developed by the 3 major credit bureaus to help predict your credit report. VantageScore may be beneficial to new borrowers because it takes less time to establish a score than a FICO score. Just make sure you understand the differences and which score your lenders are tracking.

Credit Karma is actually a great resource for free credit reports and credit information. The thing you have to watch out for when using Credit Karma is that they pull your VantageScore and not your FICO score.

If you’re a member of Marine Credit Union, you can see your FICO score in online banking.


You should NEVER be paying to improve your credit. Credit counseling agencies, like GreenPath, offer free consultations. Working with a counselor can help you understand your financial goals, issues, and steps. They are here to help improve your credit score without breaking your bank. Also, watch out for ads and sites that promise they can improve your credit score in a short time frame in exchange for payment. This is often a scam as building credit should be completely at your own expense and time.

Identity theft is also an issue to be aware of. Make sure you are always checking your card statements and usage to make sure your card and/or identity isn’t compromised. Dispute and report any suspicious or unrecognized claims to your card company or creditor. Experian offers free identity theft checks and most card companies have card-locking features to help protect you. Check out for more information.

Additionally, you can check out the Consumer Financial Protection Bureau (CFPB) or Next Gen Personal Finance (NGPF) for more assistance with credit building, credit scores, and credit bureau issues. Should you need more information about credit, check out the resources listed below.

More Credit Resources