Credit Cards To Help Rebuild Credit
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.
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.
On your card you will have to pay an annual fee and a high interest rate. Unfortunately this is an unavoidable cost, however with proper use you can ensure this is the last time you will have to pay high interest rates.
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 help because it shows; you use your credit, and use it responsibly. In addition having available credit will increase your available credit to debt ratio, this shows the bureaus that you are not in over your head.
The other alternative for a credit card is a shopping card. This card is only accepted through a designated catalog or through a website. These cards often only report to one credit bureau and have large fees.
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 a sub prime unsecured credit card to help rebuild your credit score. It will create a positive payment history and build positive credit.
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