Tips on Rebuilding Credit Rating Using Unsecured Credit Cards - Bad Credit
Tips On Rebuilding Credit - Using Unsecured And Secured Credit Cards
It is estimated that approximately 33 millions Americans struggle with some form of bad credit. This is about 10% of the entire US population.
One's credit history is becoming increasing important. For people struggling with bad credit, sometimes, it feels like the number is tattooed on your forehead, especially, if you've made an attempt to secure a home loan, auto loan or personal loan.
The fact is that creditors are not eager to extend a line of credit to you, if your FICO score is not above the 650 range. There are a number of reasons why your FICO score may be low - bankruptcy, too much debt, not paying your bills on time, etc.
The good news is that your credit score can be improved. The key to increasing your credit score is to maintain a line of credit and prove to your creditors that you are capable of paying your debts on time and not maxing out your credit line. These four simple steps will help you improve your credit score:
1. Get a copy of your credit report. Take advantage of the free government credit report from each of the National Consumer Credit Bureaus: Equifax, TransUnion and Equifax. This will help you to understand your starting point. It will answer the question - "how bad is my credit?"
2. Apply for a line of credit. You can apply for an unsecured credit card or a secured credit card (this is sometimes referred to as a "prepaid" credit card). Go to the website below under "Credit Cards for Bad Credit" for additional resources.
3. Once you have the card, do not max out your credit card. Try not to exceed 70% of the credit card's limit. For example, if the credit card limit is $1000, you should only charge up to $700.
4. Always, pay your bills on time. This accounts for 35% of your FICO score. It's the most important factor in proving your credit-worthiness to your creditors.
Practicing these four simply principles will help you to increase your credit score in the coming months.
About the Author: Delia Galley writes about debt management and credit counseling. For resources on credit repair visit http://www.poorcreditgenie.com. The site offers information on how to rebuild your credit, find "bad credit" credit cards and access bad credit auto loans, home loans, home improvement loans, personal loans and debt consoildation loans.
Secured credit cards are easy to get and help build your credit score
As we have pointed out before, establishing credit can be
tricky if you do not already have credit. The first thing any
lender wants to do when you apply for an account is to check
your credit report. And if you have no credit, there will not be
anything on the report that suggests that you are worthy of any.
It's a classic "Catch 22" situation. What can you do?
There are several solutions, but the best of them is for you to
establish an account with a company that offers a secured credit
card. Like the name suggests, such a card is "secured' by cash
collateral. When you open your account, you will provide the
lender with a cash deposit. This money will be placed into an
interest bearing account in your name and as long as you have
the card, the money will be held there.
Your card will be issued to you with an available limit that
does not exceed the amount of the deposit. In some cases, the
limit will be as little as half of the deposit amount, but more
often than not, you will be granted a limit of close to the
total deposit amount.
(These cards differ from prepaid credit cards, where there is no
bank account that secures the card. With prepaid cards, the
money is actually "loaded" onto the card itself. Your card has a
limit of however much cash you gave them when you purchased the
card. These cards may be "reloaded" for repeated use, but they
are generally considered to be debit cards and do not help you
establish a credit history, although there are some exceptions
to this.)
Having applied and put up a deposit to secure the account, you
will have a credit card that you may use just as anyone else
might use one. The card is otherwise indistinguishable from any
other "normal" credit card. You will receive monthly bills, and
as long as you pay them on time, you will be earning credit in
your name and building your FICO credit score. You may continue
to use this card for as long as you like, but at some point you
will probably want to try to obtain an unsecured credit card.
Unsecured credit cards tend to have lower interest rates than do
secured cards. Plus they are less likely to include an annual
fee for their use. And of course, they don't tie up some of your
cash in a bank account that you cannot touch. For anyone who
needs to establish credit, a secured card is the way to go, but
you do not want to keep using one any longer than is absolutely
necessary. They are just too expensive.
About the author:
Talbert Williams offers debt consolidation referrals and
advice. For more information, news, tools and valuable
resources on debt solutions, visit this site:
http://www.1debtfreedom.com
Items covered in this section:
Tips on rebuilding your credit rating with secured and unsecured credit cards with bad credit. Get the best low interest bad credit secured credit cards. Finding The Best Bad Credit Cards that you need to improve your low credit score. Improve your bad credit history with a secured credit card. Get great deals on bad credit secured credit cards with the best lending institutions & banks available. Lower the monthly payments on your new secured credit cards & loans. Get a low interest secured or unsecured bad credit credit card. Find the best alternative lending institutions. Get a bank interest rate quote on a revolving line of credit. How to get banks & finance companies to lend you money at the best possible rates. How to get your lender to see things your way. Combine your higher interest rate credit cards on to a zero 0% interest rate credit card. High risk bad credit secured credit cards.
