How to fatten up your ‘thin’ credit file


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A thin credit file can be a challenge for young adults new to the world of credit. Your credit file represents the number and type of accounts you have opened, as well as any recent activity.

A thin file may not impact your life today, but it could in the future. To build a healthy credit profile, you should open a few different types of cards with various banks and keep them active.

When it comes to thin credit files, you want to fatten them up and not stay lean. The more credit accounts held in good standing you can report to the major credit reporting agencies, the better.


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Let’s learn about thin credit files and how you can build up enough credit history to qualify for the credit accounts you need now and in the future.

What is a Thin Credit File?

The three major credit bureaus (Experian, Equifax and TransUnion) maintain credit reports for individuals and provide access to a person’s credit report when most lenders pull your credit during a credit check.

When you have a thin credit file, a bank or lender can find it challenging (or even impossible) to assess your creditworthiness. As a result, you might not qualify for the types of credit you need to purchase cars and homes, apply for credit cards, open a future business, or generally receive favorable loan terms.

That means one in every ten American adults have no credit history with one of the three major credit bureaus, hindering access to credit and valuable financial services.

Related: Secured Credit Card vs. Unsecured: What’s the Difference?

How to Build a Credit History

Thankfully, everyone has to begin somewhere and not having a credit history doesn’t spell doom for you forever. You can take one or more actions to establish credit and put an end to your thin credit file woes.

You need not feel like you sit in an impossible situation of needing credit before you can build credit.

In exchange for the risk of extending you a credit limit on a thin credit file, some of these actions let you make a security deposit or borrow from yourself to demonstrate exemplary personal finance habits and demonstrate you’re fairly responsible with credit.

When pursuing any of these avenues, make sure you have no missed payments, don’t make poor decisions with the credit extended, and live within your means to avoid accumulating debt.

Related: 5 Ways to Build Credit as a College Student: What to Know

What Credit Accounts Should I Consider First to Build My Credit Score?

1. Secured Credit Card

secured credit card is a type of credit card that requires you to put down an upfront cash deposit, usually equaling the amount of your credit limit.

This cash security deposit helps protect the credit card company from recognizing a loss by issuing you a credit card and failing to receive payments.

A secured card typically works best for individuals with no credit or looking to rebuild bad credit.

Related: 9 Best Credit Cards for No Credit History: Starter Credit Cards

2. Credit Builder Loan

Credit builder loans and credit cards are very different in how you fund and use them, but both are useful for building credit.

If you build up your score enough, you can qualify for better terms on a credit account, car loan, or other forms of financing.

These loans do not require you to have stellar credit to receive approval, just the income to make payments. They work by depositing money into a bank account and borrowing money from it while making repayments.

You’re essentially taking money out of one pocket and putting it in the other. However, you’re doing so with the understanding it builds credit for you.

Typically offered by credit unions or other smaller financial institutions like a community bank, these credit builder loan payments should get reported to the credit bureaus. In return, this helps you build your credit—though be sure to confirm this!

3. Authorized User Status

The credit card company holds the person who signed up to be the primary account holder responsible for paying charges on their account.

If an authorized user makes purchases on the unsecured card but doesn’t pay toward the balance, they are not responsible for repayment.

Parents wanting to help their children build credit often use this strategy.

Further, you should determine this ahead of time because any charges that you make will be their legal responsibility, even if you agree to pay them.

Credit card issuers report your balance and payments every month to credit bureaus. So, even if you don’t receive a physical card, it affects your credit in the same way.

If you don’t meet the requirements for having credit cards on your own, having an authorized user status on a cardholder’s account might be beneficial to building positive “payment history,” a credit scoring component.

Related: What is Credit Card Piggybacking & Does It Help Credit Scores?

4. Alternate Payment History Appearing in Your Credit Report

  • revolving loans
  • installment loans
  • student loan payments

However, the major credit bureaus also offer credit products to incorporate more items into your score. Products like Experian Boost account for actions in your overall credit profile like:

  • utility payments
  • rent payments
  • cell phone payments

By paying rent, utility bills, and rent, you also demonstrate your ability to manage other liabilities. Taken together, these added items can create a good credit score worth using when applying for a loan or credit card from a bank or credit union.

Related: Best Credit Cards for Students with No Credit

5. Co-Signers on Credit Products

Authorized users don’t need to face the music if they can’t pay their credit card bill, as the primary cardholder remains liable to the lender.

Having a co-signer credit card works similar to carrying a joint brokerage account or bank account—you both have access to the funds. However, they differ because joint accounts list both owners as equals, meaning they share the account title and legal responsibility.


Who Usually Has a Thin Credit File?

These communities have a higher likelihood of having no credit history or not enough current credit history to produce credit scores sufficient to qualify for financing or any loan product.

As a result, thin credit file holders have decreased access to receiving a home loan, car loan, personal loan, or other forms of credit necessary to receive competitive financing terms or credit at all.

Credit reports and credit scores play pivotal roles in the lives of consumers today. Having access to credit can provide for a better life by making major purchases fall within your reach.

Fortunately, a thin credit file shouldn’t be an insurmountable obstacle with many of the actions outlined above. Instead, if you work deliberately to establish good credit habits like paying your bills on time every time, this can go a long way toward establishing a good credit history.

Further, learning not to exhaust every line of credit and instead right-sizing your debt draws against your available credit demonstrates your control over credit accounts.

What Can You Do with Thin Credit File?

Using the steps outlined above, you should make good progress toward fattening up your thin credit file.

You can begin reporting credit activity and ending your thin file by tapping into secured credit cards, credit builder loans from credit unions, and even low-limit unsecured credit cards.

You can also lean on other payments you routinely make to certain types of companies to jumpstart your credit score. You can utilize a credit bureau program that captures on-time payment history on expenses like rent, utility bills or cell phone bills.

Further, suppose you attended college and have student debt. You can have these payments get reported to the credit bureaus by making payments on your student loans while in college or immediately following graduation.

Showing you can handle these expenses over more extended periods will go a long way toward building credit.

Related: Joint Credit Cards: Can They Help Build Credit?

How Can I Check My Credit Building Progress?

You have the right to check your credit report from each of the three nationwide credit reporting agencies once every twelve months for free through

Consider requesting your credit report from each bureau every four months to understand the credit file built on you and whether all of your active account information appears correct.

If something looks amiss, be sure to dispute the errors as this might artificially depress your credit score, causing you to have bad credit instead of simply a thin file.

Many credit card companies offer in-app credit score access if you also apply to credit cards, alerting you to your progress in building your credit file.

These free credit scores can indicate how specific actions affect your score in close to real-time. Though, these scores might not be 100% accurate, as you can only truly get your credit score through lenders making a pull on your credit.

In the credit world, increasing a score takes far longer than eroding one. Much like a person’s reputation, good credit can take a lifetime to build but take only an instant to destroy.

Therefore, to prevent such a thing from happening to you, stay on top of your payments, check your credit report and credit score regularly, and open sensible lines of credit with different lenders to fatten your thin file. Your credit score will thank you.


About the Author and Site

In 2018, I was winding down a stint in investor relations and found myself newly equipped with a CPA, added insight on how investors behave in markets, and a load of free time.  My job routinely required extended work hours, complex assignments, and tight deadlines.  Seeking to maintain my momentum, I wanted to chase something ambitious.

I chose to start this personal finance website as my next step, recognizing both the challenge and opportunity.  I launched the site with encouragement from my wife as a means to help younger generations learn how to invest, manage and plan their money with confidence.


I have not been compensated by any of the companies listed in this post at the time of this writing.  Any recommendations made by me are my own.  Should you choose to act on them, please see the disclaimer on my About Young and the Invested page.


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