Do you want to know what credit score do you start with? Well say no more, you’re at the right spot. As you begin building credit for the first time, it can help to understand what influences your starting credit score
When you check your credit score for the first time, you might be surprised to find a three-digit number, even if you’ve never used credit before. That’s because your credit score doesn’t start at zero. In fact, the lowest possible score from FICO® or VantageScore® is 300.
But unless you’ve had some recent trouble with on-time payments or high spending, your score likely won’t be that low. Read on to learn more about where your score starts and why using credit responsibly is important from day one.
How Is Your Starting Credit Score Calculated?
If you want to build and maintain a good credit score, you need to know how a credit score is calculated. is based on the following five factors:
Here are five factors that will have a direct impact on your scores your FICO credit score:
- Payment history: Your history of on-time payments is the most important factor that makes up your score. Even if you can only make the minimum payment on your credit cards, make sure you make it on time.
- Debt: How much current unpaid debt you have across all your accounts. This is your credit utilization. Try to keep the amounts you owe below 30 percent of your available credit. If you have a credit card with a $1,000 credit limit, for example, try to keep your outstanding balance below $300. If your balance gets any higher, do your best to pay it off as quickly as possible.
- Credit utilization: This represents how long you’ve been using credit is another key role to building your credit score. If you are new to credit, your credit history isn’t going to be very long but it’s only a matter of time. Credit utilization is usually expressed as a percentage.
- Credit mix: How many and what kinds of loans do you have, such as revolving credit accounts and installment loans. The different types of credit accounts under your name also play a key role. Your credit score could improve if you have both revolving debt (like credit cards) and installment debt (like loans) in your credit history but don’t worry if you haven’t taken out any loans yet. You can still establish a good credit score with just credit cards.
- New credit: How many times you’ve applied recently for new credit. The effect of a single application on your scores might be minor, but a lot of new applications, each of which triggers a hard credit inquiry, could still give a negative impression to lenders. Try to wait three to six months between credit card applications to avoid lowering your credit score with too many new credit requests.
What Does Your Credit Score Start At?
Most people won’t have credit reports or scores before turning 18. You typically have to be at least that age to open a credit card in your own name. If you’ve never used any form of credit before, there’s no way to track your credit usage. And in many cases, that means credit reports and scores may not exist.
But when you’re eligible to start borrowing on your own, you’ll see credit scores and reports as more lines of credit or loans are opened in your name. In some cases, you’ll also see scores and reports in your name if you’re added as an authorized user to someone’s account.
It all depends on how you start using credit. Some people wonder whether the starting credit score is zero, for example, or whether we all start with a credit score of 300 (the lowest possible FICO score). The truth is that there’s no such thing as a “starting credit score.” We each build our own unique credit score based on the way we use credit.
If you haven’t started using credit yet, you won’t have a credit score. You begin to build your credit score after you open your first lines of credit, such as a credit card or a student loan. At that point, your credit score is determined by the way you use that initial credit account. As lenders report your credit activity to the three major credit bureaus (Equifax, Experian, and TransUnion), you’ll begin to build a credit file that will be used to determine your starting credit score.
According to FICO, the minimum scoring criteria is as follows:
- At least one credit account opened for six months or more.
- At least one credit account has been reported to one of the three major credit bureaus within the past six months.
It is important to note that you can meet these requirements with just one account or several.
When a lender or landlord performs an inquiry into your credit history, they see a credit score that reflects the way you use your open credit accounts.
The key factors include whether you’re making payments on time and how much of your available credit you’re using. If you use your first credit account responsibly, you could establish good credit before you know it. If you miss payments or max out your credit cards, your brand-new credit score could suffer.
How to Establish and Maintain Good Credit
Building credit is a process. But that doesn’t mean you’re totally out of luck if you’re just starting to establish credit and considered credit invisible. Here are just a few ways to build credit for the first time:
- Apply for a credit card: If you don’t have a credit history, you might want to consider applying for a secured credit card. Secured means you give a security deposit to the credit card issuer in order to open an account. And building your credit through responsible use of a secured card can make you a better candidate for things like mortgages, car loans and even other credit cards.
- Become an authorized user: The CFPB notes, “Credit scores are based on experience over time.” So if someone like a friend or a family member has good credit, being added to their account as an authorized user could help you start a credit history.
Becoming an authorized user allows you to make purchases. But the primary account holder is ultimately responsible for payments.
Being an authorized user could allow you to benefit from the primary account holder’s credit history if the issuer reports the activity to credit bureaus. But negative actions could also be reported, which could affect the primary account holder’s credit and your credit, too.
- Take out a credit-builder loan: Credit unions may offer small loans that allow you to build your credit history. The lender deposits the loan amount in a locked savings account, and you make small payments over a fixed period to pay it back. Payments are reported to credit agencies to help you establish credit. And once the loan is paid off, you get access to the money in the savings account.
Can You Have a Credit Score Without a Credit Card?
Is it possible to build credit without a credit card? Yes, but you still need to have at least one line of credit associated with your name. If you take out a student loan or a car loan, for example, those credit accounts become part of your credit history and help establish your starting credit score.
You could also build credit by becoming an authorized user on a friend or relative’s credit card, or use a service like Experian Boost to add telecommunications and utility payments to your Experian credit report.
If you don’t have a credit card, where does your credit score start? It all depends on how you use the other credit accounts under your name. If you make on-time payments on your student loan, for example, you’re doing the work of building a positive credit history.
If your payments are consistently late, your credit history and credit score might not be as good.
How to Check Your Credit Score
If you are new to credit, it’s a good idea to check your own credit score before you start applying for additional credit cards or loans.
That way, you won’t make the mistake of applying for a credit card designed for people with excellent credit when your own credit is still average. Although, there are some cards aimed towards people with no credit history.
Many banks and credit card issuers give you access to free credit scores. Credit monitoring services provide weekly credit score updates and keep track of potential threats to your credit (like identity theft attempts).
You can also access your credit score through certain popular personal finance apps, such as Mint.
Some free credit score services will provide you with a VantageScore instead of a FICO score. VantageScore is one of FICO’s main competitors and although its scoring system is slightly different than FICO’s, the credit ranges overlap. If you have good credit with VantageScore, you’ll have good credit with FICO.
What is the FICO Credit Score Ranges?
In addition to understanding how a FICO credit score is calculated, it’s a good idea to know the FICO credit score ranges. FICO scores range from 300 to 850 and are divided into the following categories:
- Exceptional: 800-850
- Very Good: 740-799
- Good: 670-739
- Fair: 580-669
- Very Poor: 300-579
Your goal should be to get your FICO score above 670 as quickly as possible. Once you have good credit, you’ll be able to apply for some of today’s best credit cards—plus, it’ll be easier to take out a mortgage, rent an apartment, buy a car, sign up for a new smartphone plan, and more.
I hope you have learned something new about what credit score do you start with. A credit score doesn’t start at zero, but no matter how you choose to build a credit history, it’s imperative that you start off on the right foot.
You can establish good credit by selecting the right credit card to meet your financial goals and habits, making on-time payments, keeping your balances low, and tracking your credit history as it grows.