How can I build credit without a credit card?

A great way to build credit without using a credit card is by taking out different types of loans. Now, we’re not saying you should take out a car or student loan, but if you have them already, that can work in your favor. Making those car and student loan payments on time helps build your credit history and shows that you not only are reliable, but you can use different types of loans for different situations. Also, signing up for utilities in your name helps build your credit. While it won’t establish a credit score, it can help first-time borrowers because it shows a history of responsible financial transactions.

If you’re still curious how to obtain credit without having it, here are two resources that can help guide you in the right direction: “Build Credit – Learn How to Establish a Solid Credit History” and “How to Establish Credit.”

Written by Alex Ziskind, University of Illinois USFSCO Student Money Management Center

Tweet Chats

Join the USFSCO Student Money Management Center every Thursday at 4 p.m. (CST) for a dynamic way to interact and talk with your peers on a variety of personal finance topics. Think of it as a weekly coffee date with your friends where you can share ideas on how to have a frugal Valentine’s Day or how to repay student loans. For a list of topics we cover, check here: http://go.uillinois.edu/smmctweetchats.

In order to join the conversation on Twitter, just follow us at @ILStudentMoney, search the hashtag #UIMoney, and use that hashtag to ask and answer questions. Tweet ya on Thursday!

Written by Alex Ziskind, University of Illinois USFSCO Student Money Management Center

Can I get a credit card if I don’t have any credit or a job?

The answer is complicated. Trying to get credit without having credit is a catch-22, because you need credit to build credit. Fortunately, there are some loopholes to this situation.

For one, you can build credit by getting a secured credit card from your bank or credit union. The different between a secured card versus a traditional credit card is that you must deposit money in a savings account before using the credit card. Therefore, any spending you do with the card is “secured” by the money you deposited. Keep in mind a secured credit card is different than prepaid debit card; you can’t build credit with a prepaid debit card, but you can with a secured credit card.

If you’re still curious how to obtain credit without having it or a job, here are two resources that can help guide you in the right direction: “Build Credit – Learn How to Establish a Solid Credit History” and “How to Establish Credit.”

An important law that dictates whether or not you can get a credit card is the Credit Card Act of 2009. This law states that if you’re under the age of 21, you cannot get a credit card unless you have a cosigner or proof of your ability to repay the lender. A secured credit card is also a good way to establish credit if you’re under 21 since it shows you have the ability to pay up to the amount that is deposited in the savings account associated with the secured credit card.

Written by Alex Ziskind and Andrea Pellegrini, University of Illinois USFSCO Student Money Management Center

Get your deposit back!

When moving out of your apartment, the most common issue you might encounter is with the security or damage deposit refund. Cleaning the apartment thoroughly upon move out and taking pictures will help save you money. Sometimes landlords keep the entire deposit and charge the tenants more! Protect your money and CLEAN! CLEAN! CLEAN! & snap pictures of the condition that you’ve left the apartment in. If the landlord does not provide you with an itemized list of damages before deducting from your deposit, and/or provides you with a refund check that is less than the full amount, do not cash the check.

Have questions? Contact the Tenant Union by submitting an information request form: http://tenantunion.illinois.edu/RequestInfo.aspx.

Happy saving!

Written by Tanisha King-Taylor, Tenant Union

What do I need to know about the borrowing process?

Many students and families rely on borrowing to finance their education and Federal student loans are often the primary source of these funds.  The Office of Student Financial Aid (OSFA) encourages students and families only to borrow when it is a necessity, rather than borrowing as a convenient way to finance their educational expenses.

Once a student and family make the decision to finance their educational expenses through borrowing, it is important they make informed and educated decisions about the type of loan(s) to borrow and the amount of borrowing required to pay their educational costs.  Factors that should be considered and discussed throughout this process include: understanding what is means to be a responsible borrower, understanding the types of loans available and the application process for each, and understanding the repayment requirements and options for any loans borrowed.
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