Rebuild Your Credit With Credit Cards
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.
This is how you will build positive credit to your damaged score. Unfortunately because of your low score you will have to pay higher interest rates.
You should still make efforts to remove derogatory items off your credit report. However it is rumored that once a derogatory item ages four years it will not impact your score as dramatically.
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.
You credit limit will be approximately $300. The other option is to get a secured credit card, however your credit score will not receive the same benefit.
A secured card you will have to put a deposit down and the amount of your deposit is the credit line on your card. This card will report to the credit bureaus however it will not give you the same benefit as an unsecured card.
Both of these cards offer online approval. However before you apply for any card double check and make sure that card does report monthly to all three bureaus.
A helpful tip to get the most positive credit built from your card is to keep your balance at 10% of your available credit. If your card has a credit limit of $300 it will help if you can keep your balance at around $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 debit card is another option. We suggest this option to individuals in chexsystems because it 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.
This is how you will build positive credit to your damaged score. Unfortunately because of your low score you will have to pay higher interest rates.
You should still make efforts to remove derogatory items off your credit report. However it is rumored that once a derogatory item ages four years it will not impact your score as dramatically.
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.
You credit limit will be approximately $300. The other option is to get a secured credit card, however your credit score will not receive the same benefit.
A secured card you will have to put a deposit down and the amount of your deposit is the credit line on your card. This card will report to the credit bureaus however it will not give you the same benefit as an unsecured card.
Both of these cards offer online approval. However before you apply for any card double check and make sure that card does report monthly to all three bureaus.
A helpful tip to get the most positive credit built from your card is to keep your balance at 10% of your available credit. If your card has a credit limit of $300 it will help if you can keep your balance at around $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 debit card is another option. We suggest this option to individuals in chexsystems because it 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
12:49 PM
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