It can be very difficult to obtain a loan if you have no credit. The paradox is that you need credit to obtain a credit card or loan, so there’s no real way for you to build the credit that you need. However, there are certain steps that you can follow to build your credit when it is non-existent.

There are a few factors that will help you to look good in lenders’ eyes. The first is your bank account or accounts. You don’t need to have credit to obtain a checking account, so if you don’t have a current account, get one right away. If at all possible, get a savings account as well. By maintaining your bank accounts, you are proving that you can manage money responsibly. Your bank account history can be a vital factor that lenders look at before approving or denying a loan request.

Your employment and residence history are also factors that go into being approved for a loan. If you have a steady job history and have been able to hold down a job for an extended amount of time, this will reflect favorably on lending companies. Likewise, if you don’t move around frequently and have a stable residence, then lending companies will look upon your application favorably. Owning your home, even if you jointly own it with a spouse, looks good to lenders as well.

Having different utilities in your name carries some weight with lending companies. You don’t need a credit history to sign up for different utilities under your own name. This can include an electric or gas bill, telephone, cable, internet, or water service. Having your name on these utility bills won’t improve your credit score but will look good for first-time borrowers.

For those of you who have bad credit, you may want to look into a bad credit secured loan through Totally Money. A secured loan is a loan that is secured against one of your valuable assets; typically, the asset that those applying for a secured loan use is their home. By offering security, you are lowering the risk that lenders take by approving you for a loan, especially if you have bad or no credit. The amount of money you will be able to borrow and your interest rate depends greatly upon the value of the asset that is securing the loan. Secured loans should be used carefully, especially if you pursuing one for debt consolidation purposes. Make sure that you don’t use your secured loan to free up your credit cards only to max them out again. If you aren’t able to repay your secured loan, the asset that you took that loan out against can be sold by the lender to repay your loan.