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Columns: Dr. Don
Don Taylor, Ph.D., CFA, CFP Expert: Don Taylor, Ph.D., CFA, CFP
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You have to have a credit history to get a credit score
Ask Dr. Don

No credit? No credit score

Dear Dr. Don,
When starting out applying for credit, what is your credit score before you buy anything at all?
-- Heris

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Dear Heris,
Your credit score is based on the information in your credit report. A credit report chronicles your identifying information, credit history, loan applications, public records and any collection items. With no credit history there's no way to compute a credit score.

This excerpt from the myFICO Web page, "What's in my credit report?," explains in greater depth what's in your credit report.

  • Identifying Information.
    Your name, address, Social Security number, date of birth and employment information are used to identify you. These factors are not used in scoring. Updates to this information come from information you supply to lenders.
  • Trade Lines.
    These are your credit accounts. Lenders report on each account you have established with them. They report the type of account (bank card, auto loan, mortgage, etc), the date you opened the account, your credit limit or loan amount, the account balance and your payment history.
  • Inquiries.
    When you apply for a loan, you authorize your lender to ask for a copy of your credit report. This is how inquiries appear on your credit report. The inquiries section contains a list of everyone who accessed your credit report within the last two years. The report you see lists both "voluntary" inquiries, spurred by your own requests for credit, and "involuntary" inquires, such as when lenders order your report so as to make you a preapproved credit offer in the mail.
  • Public Record and Collection Items.
    Credit reporting agencies also collect public record information from state and county courts, and information on overdue debt from collection agencies. Public record information includes bankruptcies, foreclosures, suits, wage attachments, liens and judgments.

Getting credit without a credit history isn't easy but you have to start somewhere. An earlier Dr. Don column, "Right card can help build credit history," explains how to get started.

Bankrate.com's corrections policy-- Posted: June 25, 2007
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