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Credit Card Thin Credit File Credit Card (What It Means To Have One)

Thin Credit File Credit Card (What It Means To Have One)

You may have heard of Thin Credit File Credit Card before now but don’t really understand what it means and the impact it might have on your credit score. Here we let you in on what a thin credit file is and what it means to have one.

What Is A Thin Credit File, What is Thin Credit File Credit Card?

A thin credit file is explained as a credit history that has few if any, credit accounts. A thin credit file happens in the event where you’ve never had a credit account, or if it’s been years since your last credit account was closed, or if you’ve opened a new credit account within the past six months.Thin Credit File Credit Card

Disadvantages Of Having A Thin Credit File Credit Card

If your credit file is thin, the business you are making an application with, may not be able to get a credit score for you. And for the thinnest of credit files, they’ll be nothing to view at all in your credit report.

If you are making an application with a bank or another business, two major factors come into play, which is your credit history as well as your income. This is because businesses use your credit history to determine the possibility that you’re going to repay a monthly bill and your income, to gauge your ability to repay. Thus said, a thin credit file can put your credibility in jeopardy even when your income states otherwise.

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Thus, your application may be rejected, or if you are approved, you may have to pay a higher interest rate. Some services like electric service may require you to pay a security deposit to establish an account.

People Who Are Likely to Have a Thin Credit File

These set of people are likely to come up with a thin credit file according to FICO score and FICO Expansion Score.

  • Recent immigrants
  • Young adults
  • People who have recently been divorced or become widows.
  • People who mainly use cash.

How To Overcome A Thin Credit File

Here are some options for overcoming a thin credit file and ultimately building a credit history.

Open a secured credit card: Open a secured credit card account by paying a security deposit for the secured credit card. The deposit is only used only when there’s a default on your credit card.

Become an authorized user on someone else credit card: Becoming an authorized user, gives you the privilege of having the history for that account to appear on your credit report, which helps you qualify for other credit.

Apply for a credit builder loan with a local credit union: Here, the money from the loan is deposited into a savings account, while you make monthly payments on the loan. It’s just like you borrowed the money and your monthly payments, are reported to the credit bureaus. Immediately the loan is repaid, the funds in the savings account, plus the interest in some cases, becomes yours for keeps.

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Get a retail or gas credit card or a card with your current bank: You can get a credit card with a lender that typically approves borrowers with thin credit files. These are cards like retail and gas credit cards. You can also apply for a credit card at the bank where you have your checking or savings account. With an existing banking relationship, you may easily get your credit card application approved.

Get someone to cosign: Get someone who can open a joint account or cosign for you. This will also help you start building your credit history.


Note, after you open a new account, it takes a few weeks to appear on your credit report and at least six months to calculate a credit score for you.

If you are having difficulties getting a new account, ask the lender to use an alternate credit score or Vantage Score or FICO Expansion Score. These credit score solutions are a little accommodating on new borrowers and may give you a credit score when a traditional FICO score may not. Note also that not all lenders would consider these non-traditional credit scoring modules for borrowers with thin credit files.

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  • Christian Ehiedu

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