Many people like me get into trouble in their college years. During their first taste of real freedom, they also get inundated with free credit card offers. They enjoy spending however and whenever they want, then find themselves unable to make the necessary payments and mired in debt.
By the time I graduated from college, my credit score was in sorry shape. I matured after that and got steady employment, and then found myself wanting to rebuild my credit history and use credit responsibly again. Bad credit will not hunt you forever. It takes time, but getting a bad credit credit card is a good first step. My credit is now flawless and gets me the best rate possible for my mortgage.
If your credit score looks bad you can take the steps to repair it. Find out what your credit score is by obtaining a credit report. This will allow you to analyze your situations and utilize the credit options that are now available to everyone.
The number two step is to choose between an unsecured credit card that carries an astronomical interest rate or a bank-sponsored secure debit card. After you obtain credit report scores on yourself, look into the cards your bank offers and consider your account history. Do you tend to write bad checks? Do you balance your checkbook regularly and correctly? If you have a shaky history in respect to either question, take a closer look at bad credit credit cards options.
Once you choose on the bad credit cards route, you need to be aware of the available options. Is a secured deposit required? Will you instead choose no deposit but be saddled with a high interest rate? How much is the annual fee? Will the interest rate be lowered if you maintain a good payment history? Can you choose the day payment is due, so you can match it up with payday? Are there any bonus programs? What, if any, are the income requirements?
Don’t just grab any card. You have choices and rights, and need to investigate each offer carefully to make sure you’re getting a good deal. In particular, be careful with the interest rates on cards you consider. If a card’s interest rate on purchases exceeds 20%, then do not consider that offer any further. For someone with poor credit, a card with interest under 20% is a good find.
Make sure to obtain a credit report every so often to make sure your new credit card company is reporting your good payments. If they aren’t, call and ask them to do that. It can help more than you know! By the time you are asking what is my credit score again, you’ll see it start to climb up.
It takes time, but bad credit can be repaired. First, answer the question “what is my credit score“? and obtain credit report scores so that you find out where you stand. It may look bad, but there are credit options for everyone. One way to help repair credit is with bad credit credit cards - cards that require a secured deposit or charge high interest rates. Look for cards that do not charge an annual fee, let you choose the payment due date, and charge less than 20% interest. Finally, get a new copy of your credit report every few months to track your progress.
- Daniel Lesser
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