Is No Credit Score The Same as a Score of Zero?

Written By Mary Beth Eastman
Last updated March 6, 2019

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March 14, 2018

Simple. Thrifty. Living.

Most people strive to earn or maintain good credit standings. In fact, having good credit histories can make it easier to borrow funds for future purchases. This includes applying for an online loan, buying a home, along with financing a new car or business. While most borrowers are aware of their credit scores, some always need help managing their ratings. Similarly, a good credit score is usually 700 or above – but most scores fall within the 600 – 750 range. With this in mind, what about a credit score of zero? Does this mean a bad credit score or no credit score at all? The answer is usually someone that has never had credit before but wishes to open new lines soon.

Life without credit is not unheard of but very difficult in this day and age. After all, you need credit to rent apartments, buy properties or even land a job. Still, there are plenty of people that have never had any credit cards in their life. While most of these folks do have debit cards from their banks, these are connected to their checking or savings account. This is not the same as open lines of credit from financial institutions and lenders. With this in mind, here are some of the essentials that folks without credit abide by:

  • Cash on the barrel – people with no credit must have ample cash on hand to pay for all necessities: food, gas, medical, health, and insurance and non-necessity purchases.
  • Strong checking and savings accounts – folks without credit or credit cards usually rely on their debit cards or cash. However, they must have high balances in order to sustain daily living and essentials.
  • Use your own money – credit cards offer true convenience, security and rewards. However, those without credit have trained themselves to use their own money for emergencies. This includes medical and ER visits, along with hospital stays and other unforeseen circumstances.

You also need to know that most folks without credit have closed their previous accounts. This has lowered their credit scores – but many do not wish to apply or open lines of credit again. In order to become credit-free, you have to pay off all remaining loan or credit card balances. You also need to pay off any outstanding loans, such as 401K borrowing or those from private lenders.

Still, if you want to rebuild your credit – it’s as easy as applying online or via mail for new credit cards. Another thing to keep in mind is that fraud protection is better with credit cards than it is debit cards. This is because if any fraudulent charges happen on your debit card, it results in money being taken straight from your account. If you’re looking to simply repair your credit, check out the best credit repair companies here.

About the Author

Mary Beth Eastman

Mary Beth Eastman serves as the content manager for Simple. Thrifty. Living, where she is dedicated to helping readers use money and credit wisely. Mary Beth believes that access to the right financial information paired with a growth mindset are essential tools for getting out of debt and building wealth. Mary Beth has a degree in Journalism from Bowling Green State University and has focused her 20-year journalism career on putting readers front and center, carefully considering their concerns and presenting information that will help them in their everyday lives. She has won numerous statewide journalism awards. Her writing on personal finance as been featured on numerous websites in addition to Simple. Thrifty. Living, including Huffington Post and Lexington Law blog. Mary Beth resides in Pittsburgh, Pa., with her family and two rescue dogs.

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