Many people turn to credit repair cards, or secured credit cards, when they need help with fixing a poor credit score. Learn more about how a new revolving debt account can actually help increase your credit rating, as long as the account is used responsibly.
Secured Credit - Apply At Your Bank
To increase your chances of being approved for credit, apply at the bank where you normally do business. A business history with the bank, including a checking account with no overdrafts or a savings account that carries a balance, improves your standing in the eyes of the bank, even if your credit score is low. Credit unions also offer secured credit cards to members, and may charge lower fees or waive them entirely.
Research Before Applying For Credit
All credit repair cards are not created equal. Check out Bankrate.com’s list of Secured Credit Card Issuers, and read the fine print. Some of the options to keep in mind when comparing potential cards, before applying for credit, include:
- Cash Deposit - All secured credit accounts require a cash deposit, to be used if you are unable to make payments, but they tend to manage the deposit differently. In some cases, you will be allowed to charge more than you have in the deposit, but most banks will only let you charge up to the balance on your deposit account.
- Late Payment Penalties - Some creditors will take your entire deposit, and close your account as a penalty for a single late payment, while others will levy a hefty fine. Read the terms of the contract carefully to avoid a loss.
- Interest Rates - Look for an account that not only charges a low interest rate on the credit account, but pays interest for the deposit you leave with the creditor.
- Fees - Does the company charge fees even when you carry a zero balance on the card? Try to avoid situations in which you are paying too much for the privilege of carrying a card in your wallet, even when you’re not using it.
Use credit repair cards responsibly to improve your credit score after negative items appear in your debt history. Use the card for small purchases only, and pay the balance every month. Do not carry a balance on the card, and always make payments on time, and you can fix your credit score with a new secured credit card. Read more about improving your credit rating with:
Repair Your Own Credit Rating Want to repair your own credit rating? Learn how credit reports and scores work, and try these three simple credit fixes to boost your credit score quickly.
The Absolutely Free Online Credit Report - Is It A Myth? Absolutely free credit reports are advertised everywhere: "Get your instant credit report online here!" Are any of these offers truly free? Learn how to tell.
Free Credit Report from Equifax - No Credit Card Needed Want to know how to get a free credit report from Equifax? Learn about getting a free copy of your debt history without supplying a credit card number.
Getting Out Of Credit Card Debt by Paying Extra - Pay Down Cards & Reduce Revolving Debt If you don't reduce credit card debt by making more than the minimum payments and prioritizing creditors, you will lower your chances of getting out of credit card debt.
Victoria Nicks - Victoria Nicks has a Master's Degree in IT, and extensive hands-on experience with various types of hardware and software.
Join the Conversation