Credit Cards To Rebuild Credit
A credit card can help you rebuild your credit score. This card will help your ratio of available credit to debt and you can build a positive payment history.
When you have a damaged score you will be faced with a sub prime interest rate. This means you will have an interest rate around 19%.
It is very important to remove negative items on your credit, while improving your score. You should know that once a negative item ages four years then it has much less impact on your score.
If your credit score is low you will still be able to qualify for a sub prime credit card. This means you will pay approximately 19% APR and an annual fee.
Your card will have a credit limit around $300. The other alternative is to get a secured credit card.
A secured card works like this; you deposit money into a bank account with the credit card issuer and they give you a credit card with the amount of your deposit as your credit limit. Your card will work just like an unsecured card; you will have monthly due dates and minimums to pay.
With an unsecured card it will be instant approval and your payments and balance will be reported to all major credit bureaus. It is important to double check and make sure your credit card will report to all three credit bureaus.
In addition your credit will get the most benefit if you can keep your monthly balance at 10% of your credit limit. For example if your credit limit is $300 then you want your monthly balance to be $30.
This will show the bureaus that you use your credit, and you use it responsibly. In addition having this new line of credit will improve your ratio of available credit to debt. This is a very important factor when your score is calculated. It is the bureaus method of checking to see if you are in over your head.
The last option for a card is a shopping card or a credit card that is only accepted at a specific location. We do not suggest these cards; they often come with large upfront payments and only report to one credit bureau.
A prepaid card is another option. This is a good choice if you are unable to open a checking account because this card will work just like a bank account.
In sum we suggest you open a sub prime credit card for your credit score to get the most benefit. This card will help improve your score by creating a positive payment history and improving your ratio of debt to available credit.
When you have a damaged score you will be faced with a sub prime interest rate. This means you will have an interest rate around 19%.
It is very important to remove negative items on your credit, while improving your score. You should know that once a negative item ages four years then it has much less impact on your score.
If your credit score is low you will still be able to qualify for a sub prime credit card. This means you will pay approximately 19% APR and an annual fee.
Your card will have a credit limit around $300. The other alternative is to get a secured credit card.
A secured card works like this; you deposit money into a bank account with the credit card issuer and they give you a credit card with the amount of your deposit as your credit limit. Your card will work just like an unsecured card; you will have monthly due dates and minimums to pay.
With an unsecured card it will be instant approval and your payments and balance will be reported to all major credit bureaus. It is important to double check and make sure your credit card will report to all three credit bureaus.
In addition your credit will get the most benefit if you can keep your monthly balance at 10% of your credit limit. For example if your credit limit is $300 then you want your monthly balance to be $30.
This will show the bureaus that you use your credit, and you use it responsibly. In addition having this new line of credit will improve your ratio of available credit to debt. This is a very important factor when your score is calculated. It is the bureaus method of checking to see if you are in over your head.
The last option for a card is a shopping card or a credit card that is only accepted at a specific location. We do not suggest these cards; they often come with large upfront payments and only report to one credit bureau.
A prepaid card is another option. This is a good choice if you are unable to open a checking account because this card will work just like a bank account.
In sum we suggest you open a sub prime credit card for your credit score to get the most benefit. This card will help improve your score by creating a positive payment history and improving your ratio of debt to available credit.
About the Author:
We suggest the Tribute MasterCard an unsecured credit card to see a review visit us or here is an ezine article about prepaid credit cards and how they work.
posted by Credit Counseling at
8:03 AM
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