How To Build Credit In 2023: Increase Credit Score From Scratch

Updated: August 21, 2023

Written by Eddy Ballesteros Personal Finance & AI Expert: Learn More

Are you someone with a bad or no credit history? Are you looking to build credit from scratch in 2023? If yes, this guide is for you.

Here we'll discuss how to create a plan and take steps to build your credit score from the ground up.

I've worked in the credit repair industry for quite some time, and I've helped others :

  • Establish credit from nothing
  • Get approved for any credit card
  • How to refinance and get rid of high-interest charges
  • How to view their credit reports
  • How to dispute with the three major credit bureaus

I will show you exactly how to build and establish a good credit score for years to come. Let's get started.

We partner with awesome companies that offer products that help our readers achieve their goals! If you purchase through our partner links, we get paid for the referral at no additional cost! For more information, visit my disclosure page.

How To Prepare Yourself For Better Credit Scores

Before building credit, you'll need to ensure everything is in order, such as your credit reports, and check for errors or discrepancies. 

You'll need to know what your current credit score is and if any overdue accounts will require attention.

How Are Credit Scores Calculated?

When establishing credit, it's essential to understand how credit scores are calculated.

Your credit score is a numerical representation of your credit history and is used by lenders to determine your creditworthiness.

The credit bureaus will calculate your score and use their criteria to decide your credit score. The FICO score is the most widely used scoring system version, which ranges from 300 – 850.

How are credit scores calculated during credit building

Credit scores are typically calculated using a complex algorithm that takes into account a variety of factors, including:

  • Payment history: This is the most important credit scoring factor. It shows whether you've made payments on time, and if you've missed payments or made late payments, it can negatively impact your score.
  • Credit utilization: This is the amount of credit you're using compared to the total amount of credit available. The higher the credit limit, the better your utilization rate.
  • Length of credit history: This measures how long you've had credit accounts. A solid credit history can positively impact your score.
  • Credit mix: This measures the different types of credit accounts you have, such as credit cards, loans, and mortgages. Having a combination of different credit types can positively impact your score.
  • New credit: This measures the number of new credit accounts you've recently opened. Opening too many new accounts at once can negatively impact your score.

By understanding these factors, you can take steps to improve your credit rating over time.

One of the most important things you can do is establish credit and make on-time payments.

This will help build a good credit history, which can boost your credit score and make it easier to qualify for loans and credit in the future.

Get A Free Credit Report

To get a free copy of your credit report from each bureau, visit or use one of many available credit score apps that provide access to all three reports with just one click.

Annual Credit Report

By taking a few minutes to check your credit report annually, you can make sure the record information is accurate and up-to-date.

This allows you to take steps early on if any inaccuracies or outdated information appears on any of the reports so that you can prevent any negative impacts on your credit score.

Check For Discrepancies or Incorrect Personal Information

Checking your credit report for discrepancies or incorrect personal information is essential in managing your credit score.

Errors in payment history and other personal records can hurt your overall score.

Even minor errors, such as incorrect addresses or typos, can make a difference in the accuracy of your credit report.

build credit by fixing incorrect or negative items

If you find any errors in the information reported, it's essential to contact each of the three main bureaus to ensure that the inaccurate information is corrected and updated.

This can help you avoid potential issues when applying for loans or rebuilding your credit score.

Also, if you've been denied loan applications due to an error in your credit report, fixing the issue may improve your chances of getting approved next time.

Here Are The 9 Best Ways On How To Build Credit

It's time to get to the good stuff regarding building credit.

Luckily, there are simple methods to help you do this and get on the right track. Here are some of the most effective strategies:

1. Become An Authorized User

Becoming an authorized user of someone else's credit card can be a great way to improve your own credit history.

As an authorized user, you'll receive a copy of the credit card statements, and you'll be able to see how past payments have been made and managed.

This can help you better understand how to manage debt and build your credit score responsibly. Remember that as an authorized user, any late payments or delinquencies will appear in your credit history.

So if the primary cardholder isn't paying on time, it could affect your rating negatively. You want to ensure they have good credit habits and a high score. Talk with the credit card company about their policies for authorized users.

2. Get A Secured Credit Card

Secured credit cards are a great way to build or rebuild your credit history.

With a secured card, you'll be required to make a security deposit before you can use the card. The deposit amount becomes your line of credit, and most issuers report payments made with a secured card to all three of the major credit bureaus.

Making on-time payments is critical to successfully rebuilding your score with a secured card. Your payment history makes up 35% of your overall score, and missing payments can negatively impact your score.

If you stick to the issuer's terms and conditions, you could see an improvement in your overall rating within six months.

3. Credit Building Tools

Credit-building tools, such as credit builder loans and apps, are a great way to build your credit history without applying for a loan or credit card.

Credit builder loans allow you to borrow money from the lender, then pay it back in installments over time.

StellarFi Logo Box


  • Reports to all three credit bureaus
  • Amazing customer support
  • Perfect for credit-building

As you make monthly payments, the lender reports your payment activity to all three of the major credit bureaus, helping you build positive credit history.

Credit-building apps also offer helpful resources like reporting and budgeting tools to help you track and manage your finances.

Both tools can help you achieve better financial health with consistent use.

Unlike loans or cards, a credit builder loan will safely keep your money in a CD and then release the funds to your bank account after you complete the payment plan.

4. Use A Co-Signer

Using a co-signer is one of the best ways to get approved for a loan, even if your credit score needs to be quite where it needs to be.

Not only will having a co-signer help you get approved more quickly, but it can also get you lower interest rates and better terms than what you could find on your own.

A co-signer (often a family member) agrees to be responsible for your loan payments should you default.

Once you've made consistent payments on the loan for some time and improved your credit score, you may be able to refinance without needing a co-signer.

This option can save money in the long run and provides financial security by releasing any responsibility from the co-signer.

5. Have A Good Credit Mix

Building a good credit mix is essential in improving your credit score.

This means having various types of credit accounts on your credit report. Unsecured credit cards, installment loans such as student or personal loans, and auto loans are all types of credit that can help establish a good mix.

It's important to remember that the more varied your accounts are, the better they will look on your credit file.

Having different types of accounts shows lenders that you can manage multiple kinds of debts responsibly and can help make you appear more trustworthy and financially responsible.

6. Report Your Subscriptions

Regarding building credit, reporting your subscriptions can help you get started.

From streaming services like Netflix and Hulu to utility payments like electricity and water, many bills can be said to help you improve your credit score.

Many people need to learn they can report their streaming service and monthly bills if they make on-time payments.

You may have heard of Experian Boost or StellarFi, which partner with dozens of major companies to report your payments each month. This helps boost your overall score if you pay them on time.

Other subscription services may report payments directly to the major credit bureaus if these aren't your options.

So when building good credit, remember always to pay your bills on time and watch for possible subscription services that may report your payment history.

7. Report Your Rental Payments

One of my favorite credit-building tips is reporting your previous payment history as a tenant. This can be done through both Experian Boost and Boompay, which will help you get credit for your rental payments. 

Boom Pay

Boom Pay

Boom is a rent reporting service that reports to all 3 major credit bureaus. This service can even trackback to 24 months of previous rental history.

Read Review

Reports To:

Experian, Equifax, TransUnion



Ease of Use:


Reporting Benefits:

Up to 24 months

By signing up with one of these services, your rental payments will be reported to the major credit bureaus each month and can positively impact your overall credit score over time.

8. Ask For A Credit Limit Increase

Higher credit limits are one way to build credit, but using the extra credit responsibly is important. Even if your credit card balances show more available credit, you should still spend more money.

You can quickly contact your credit card issuers and ask for a credit limit increase. They will review different factors and see if you have an established credit history with them and that you pay bills on time.

It's also important to remember that if you do request and receive an increased credit limit, your reported balance will change.

Even if you don't utilize the entire increase, having a higher limit than before could negatively affect your debt-to-credit ratio.

This means having a large outstanding balance compared to the new higher limits could impact your overall score. Be sure always to use your credit card responsibly when increasing your limits.

9. Monitor Your Credit

Regularly monitoring your credit is essential to maintaining a good credit score. You should check your credit report often, preferably once every few months. 

Look out for signs of fraud or identity theft, and consider setting a fraud alert or even freezing your accounts if warranted.

Monitoring your credit utilization rate is especially important when building your credit. This is the ratio of debt you owe to the available credit you can access. Aim to keep this ratio as low as possible, preferably under 30%, to ensure healthy credit scores over time.

If you've been denied credit, remember that there are also specialized services for covering all aspects of credit monitoring so that you can improve your financial record and situation quickly and efficiently.

How To Build Credit From Scratch

Building credit from scratch can be a daunting experience, but it doesn't have to be. Establishing good credit habits is the best way to begin. 

Make sure to pay everything on time and never miss a payment. If you can, try paying more than the minimum balance due each month, and always aim to keep your debt-to-credit ratio low.

I'd also recommend to:

  • Reviewing your financial goals
  • Make more than the minimum payment
  • Build credit with a credit builder loan or secured credit card
  • Report your streaming service bills to build credit history

When considering retail credit cards, take caution. These are often misleading and may carry higher interest rates or annual fees, so avoid them if possible.

Instead, focus on building a credit mix by establishing a secured credit card account, or apply for an unsecured one if you have a strong financial record overall.

Constantly monitor your credit reports to stay up-to-date with how your score changes. With determination and effort, you will soon see results in the form of improved credit scores.


What is the fastest way to build credit?

The fastest way to build credit is by doing these credit hacks:

  • Become an authorized user
  • Increase your credit limits
  • Use a Credit building app
  • Make two payments a month instead of one. Make the payment on the 1st and 15th of every month
  • Ask your lender or credit union for a rapid rescore
  • Dispute negative items with the three credit bureaus
  • Refinance high-interest debt such as car loans

How can I build credit if I have no credit?

The easiest way to build credit is by applying for a credit builder loan or a secured credit card. Both are designed for those with little to no credit, and using them responsibly can positively impact your score.

You should also make sure to pay all of your bills on time, as this is one of the most important factors in determining your credit score. Finally, use a company like Stellarfi to report your cell phone and other subscription payments. 

How fast can you build credit?

No matter how you build credit or want a strong credit history, it can typically take 30-45 days to see an update on your credit reports.

This is due to the major credit bureaus and how the FTC regulates them. However, the exact time to build credit depends on the types of accounts you are opening, how often and when you make payments, and other factors.

Use a free service like your Experian credit report to monitor your credit score and report any changes quickly to get more accurate results. 

How can I see my credit for the first time?

You can see your credit for the first time using different apps and with those you bank with.

My chase checking account gives me a free score, providing information on my debt and financial goals. Since most lenders use it, you'll want to ensure that it's your FICO score. 

Final Thoughts

Now you know my top credit-building tips and how to establish credit for the first time. Remember, don't open an unsecured credit card from the start. 

You want to use my credit hacks listed in this blog post. Here's a recap of what we discussed if you scroll to the bottom of this page.

  • Making payments on time is more important than ever
  • Pay more than what the minimum payments ask for
  • Apply for a secured loan such as a credit builder or credit card
  • Become an authorized user
  • Ask for a credit limit increase
  • Review your FICO score, not your vantage credit score

Building credit can be easy when you make smart decisions and make timely payments.

If you need help with credit repair, you can also work with credit repair companies or use software to automate the process. I hope you found this helpful, and good luck on your credit journey.

About the Author

Eddy Ballesteros

AI & Marketing Nerd

Eddy is an AI, SEO, and personal finance blogger who uses and tests products to help others improve their lives through AI and financial literacy. With years of experience in online business, he deeply understands the latest AI and SEO trends. Eddy is also well-knowledged in personal finance and committed to sharing his knowledge and expertise with his readers.