Secured Credit Cards: Rebuild Your Credit On-line
If you have ever had bad credit or an insufficient credit history you know how difficult it can be to correct. There are a number of reasons why you might have credit problems – if you are new to the United States or are recently divorced, or have recently declared bankruptcy you probably have credit issues. No matter what the reason is, you can start today to rebuild your credit, and Prepaid Credit Cards can play an important role in establishing good credit.
Here are a few steps that you can use to turn your credit around, or to establish credit if your credit is insufficient:
1) Open checking and savings accounts. Credit agencies and banks need to know that you have both. A savings account shows them that you are thinking and planning for the future, and a checking account shows them that you have the tools available to pay your bills responsibly.
2) Pull your own credit report. If you are young, or you have no credit history, or if you are new to the United States, you may have no credit history on file. If you’ve had credit problems in the past, most likely they’ll be on the report. You can get a free credit history from any of the three large credit reporting agencies (Experian, Equifax and TransUnion) on-line; just Google “credit report” and find one that is free and with no strings attached.
3) Make sure that all of the basic information on your credit report is complete and accurate. The report will list information such as phone number, address, a second address if you’ve been at your current address for less than two years, date of birth, Social Security number and so on. Instructions for getting this information corrected will be included with the report.
4) Check credit references and information on your report and make sure it is accurate. You often can find bad credit references that are inaccurate or wrong. Look for accounts that don’t belong to you. If you find errors, dispute them by writing to the issuing credit bureau. Information on writing to correct or dispute information on your credit report will be included with the report when you receive it.
5) Apply for a secured credit card. Secured credit cards or “Prepaid Credit Cards” work just like secured loans. Anyone can get one regardless of credit history. The issuer will ask that you deposit a small amount of cash into an account and then they will issue your credit card with a credit limit close to your deposit amount. By far the easiest way to shop for a prepaid credit card is on-line.
6) Once you have your secured credit card, make sure you use it responsibly. Only charge as much as you can pay off each month, and make sure you pay your bill on time every month. When you’ve shown a willingness and ability to handle your credit responsibly for twelve months or so other credit options including unsecured credit cards will become available to you.
Bad or unestablished credit can be a real pain when you really need credit. Using the steps described above you can start today to build good credit so you have it when you need it.
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