Fixing a Thin Credit File

The best way to address a thin credit file is to actively develop credit. The easiest way to build your credit is to use credit cards. However, without a credit score, you will likely have a hard time getting approved for a typical credit card. In that case, a secured credit card can help you establish credit when you don’t have any.

A secured credit card requires a security deposit or collateral in exchange for a credit limit. In most cases, the security deposit is equal to or a percentage of the total credit allowance. If you pay your bills and eventually reach a zero balance, you’ll be able to recoup the deposit upon closing the account or when the lender converts your account from secured to unsecured. With a credit card (secured or unsecured) in hand, you’ll be able to start building or re-establishing your credit. To do this, you can regularly use your card in small, manageable increments and regularly make payments.

Your goal is to build or re-establish credit and not make huge or unnecessary purchases with your card. High credit utilization will not help build your credit. Only use your card if you are confident you can pay off the debt at the end of the month. Your credit card activities will be reported one way or another, so it’s important that you add positive history as you rid yourself of a thin file.



Some information on this page is adapted from content that originally appeared on, a Venturize supporter.

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