Rebuild Your Credit With Credit Cards
Getting a credit card to help rebuild your credit history is a very wise decision. A credit card can help you create a positive payment history.
However you will only qualify for a sub prime credit card if you have a damaged credit score. This means your card will have an interest rate around 19%.
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.
On your card you will be given a credit line of $300. Your other choice 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.
Both these types of cards offer instant approval. Before you apply for any card double check and make sure that they report to all three credit bureaus.
Another tip to help you get the most benefit to your credit is to keep your balance at roughly 10% of your credit limit. For example a credit limit of $300 you will want to keep the monthly balance at $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.
You also can apply for a prepaid credit card however these cards typically do not report to a credit agency. However they do work like a bank account and if you are in chexsystems this is a good choice.
In sum we suggest a sub prime unsecured credit card to help rebuild your credit score. It will create a positive payment history and build positive credit.
However you will only qualify for a sub prime credit card if you have a damaged credit score. This means your card will have an interest rate around 19%.
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.
On your card you will be given a credit line of $300. Your other choice 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.
Both these types of cards offer instant approval. Before you apply for any card double check and make sure that they report to all three credit bureaus.
Another tip to help you get the most benefit to your credit is to keep your balance at roughly 10% of your credit limit. For example a credit limit of $300 you will want to keep the monthly balance at $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.
You also can apply for a prepaid credit card however these cards typically do not report to a credit agency. However they do work like a bank account and if you are in chexsystems this is a good choice.
In sum we suggest a sub prime unsecured credit card to help rebuild your credit score. It will create a positive payment history and build positive 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 Debt Consolidation Loan at
9:22 AM
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