Final answer:
A 'No hit' on a credit prequalification indicates that the credit bureau could not find a credit file, possibly due to no credit history. While it's harder to establish a line of credit, it is not impossible, and options like secured credit cards and credit-builder loans can help in establishing a credit history.
Step-by-step explanation:
When the result of a credit prequalification is a "No hit," it generally means that the credit bureau was unable to locate a credit file for the individual applying. This could be due to a lack of credit history or incorrect personal information provided during the prequalification process. Establishing a line of credit under these circumstances can be challenging, but not impossible.
For someone with no credit history, financial institutions might require a different approach to set up a line of credit. This may include providing additional forms of identification, proof of income, or even applying for a secured credit card or loan that requires a deposit or collateral as security. It is also advisable to start building credit by being an authorized user on another person's account or by using credit-builder loans.
Lenders have their own criteria for setting up lines of credit, and a "No hit" does not mean an automatic disqualification. It's important for the individual to speak directly with potential lenders to identify what options might be available to establish credit. Some financial institutions offer products specifically designed to help people in this situation begin building a credit history.