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Living Without a Credit Score

Picture this: You’re on the hunt for a new-to-you car. You walk into the dealership only to hear Billy Bob say those dreaded few words: “Let me pull your credit report.” Sound familiar? Of course it does!

Instead, picture yourself walking into that same dealership with your head held high, pockets full of cash. When Billy Bob mentions checking your credit, you respond confidently, “No need, I’m paying in cash.” Yeah, you are . . . because you’re living without credit.

This “dream” can be your reality! Seriously, have you ever stopped to consider what life could look like if your major life decisions (and purchases) didn’t revolve around your credit score?

How to Live Without Credit

Buying a Home

Don’t have a credit score? Good. Despite what everyone says, you don’t need one to buy a house! And if you’ve never gone into debt, that shouldn’t be too difficult, right?

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Now it’s time to focus on one thing: making sure you have a large down payment to buy your next home. Without a credit score, your down payment is a big factor (along with your job and how long you’ve been employed in that line of work). You’ll also want an outstanding history of rental and utility payments. Look for a mortgage company that uses a process called “manual underwriting,” sometimes called “nontraditional credit” or “no credit score” lending.

If you’re just starting your home-buying journey, be patient. Rent for a while if you need to and save up even more to put into a down payment. And whatever you do, don’t buy a house until you’re ready. That means you’re completely out of debt, you have 3–6 months of expenses saved in an emergency fund, and you have a good down payment. Of course, if you really want to, you could always just pay straight cash for a house! Cash is king, baby!

Renting an Apartment

Most apartments will work with you if you can provide first and last month’s rent, proof of being a good renter (such as previous on-time utility payments), and a security deposit. Be sure to ask them up front about their process and what type of information they’ll need to get started.

If they want a credit score and you don’t have one, simply tell them that you don’t have debt and you use cash. Get a rental history referral from your previous landlord. If it’s your first time renting, you might have to look around for a little bit. But don’t worry, you’ll be able to find someone to work with you.

Applying for a Job

This is a recent trend, but it mainly affects people in the financial industry—banks, mortgage brokers, investment companies and so on. Again, the key here is to learn the company’s hiring process up front so you can explain why you don’t have a credit score if they ask you about it.

Remember, these answers only apply if you have no credit score. If you have a bad credit score because of any outstanding debts, that’s a different situation entirely. It’s time to focus on cleaning up those old debts with the debt snowball method and start fresh!


The naysayers out there want you to believe you can’t travel without a credit card. But that’s just not true! Your debit card (and cold, hard cash) works just as well—no, better—than a credit card. When you use your debit card, you’re using money that you own and have worked hard for instead of borrowing on interest!

If you’re looking into renting a room at a hotel, call ahead and let them know you’ll be using your debit card. Then, make sure to budget for the possible security hold they’ll put on your card for the duration of your trip.

You can also rent a car using your debit card. Some companies have made it a little easier on people like you who live without a credit card! Each company has its own debit card policy, so it’s always good to do your research. Like we said earlier, just call ahead and ask about any holds they might place on your debit card and budget for your trip accordingly.

Benefits of Living Without Credit

It’s time to measure your success (and financial worth) in a different way—by what’s in your bank account. Who said the credit score is the only way things can be done?

Now that we know you can buy and rent a car, take out a mortgage, and even get a hotel room without a credit score, let’s dive into some other reasons living without credit cards is a great idea:

1. You’re no longer enslaved to a life of debt.

When you’re not enslaved to your credit score (or your credit cards for that matter), you’re no longer worried about payments for things you’ve purchased in the past—or worried about how you’re going to pay for your future. Not only that, you’re also free. You’re free to spend your money on the present and save for the future.

2. Your bank account becomes your measuring tool.

If you haven’t heard, the FICO score is just another name for the “I love debt” score. Think about it: Businesses, banks and even the government use this silly little number to analyze your past and present relationship with debt. But when you choose to leave all care about your score behind, you get to measure things by what you actually have in your bank account (and what you can afford).

3. You’re in complete control of your finances.

Like we’ve said before: Cash is king, baby! When you start saving up for life’s big purchases (to pay in cash), you’ll find that a credit score is worthless. Not only will you have the power of negotiation on your side, but you’ll also find out how much easier it is to buy things outright. Who’s going to turn down cash?

4. You’re less likely to overspend.

When you’re not relying on a credit card for “emergencies,” you have one option: to pay for things with the money you have in your bank account. When your money is gone (or spoken for with your zero-based budget), you’re done spending. Living life without credit means you know exactly what it’s like to live within your means—and it feels good.

5. You’ll build wealth and give generously.

When you’re debt-free and you’ve reached Baby Step 7, you can finally start living and giving like no one else. Baby Step 7 is all about building wealth and giving. Yup, that dream retirement you and your spouse have been working so hard for is finally at your fingertips. Maybe you’ve always wanted to travel overseas to help a nonprofit organization or give 50% of your earnings to charity every year. The options are endless, because you’re not tied to making payments every single month. Instead, you get to dream of what it can be like to use your wealth to help others. And that feels good.

You Can Live Without a Credit Score!

Our culture will tell you otherwise, but living without credit is possible! Sure, sometimes it might feel a little inconvenient because of the way our culture has embraced the “almighty” FICO. But seriously, living without a credit score will never be as inconvenient as paying interest on that fancy steak dinner you ate . . . last year.

Are you ready to break up with your credit score yet? Learn how to dump debt, save for emergencies, and build a solid financial future—plus get all the tools you need to make it happen. How? With a free trial of Ramsey+. Why? Because FICO doesn't determine your worth. You do.

Ramsey Solutions

About the author

Ramsey Solutions

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners.

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