| The last things most people would think could actually help with credit repair are credit cards. After all, the majority of bad credit cases can often be caused by out-of-control credit card debt and escalating monthly repayment amounts.
When it comes to working on your tactics for credit repair, credit cards can surprisingly be one solution for helping you get back on the right track so you can begin rebuilding your score again. The object here is to work with some very specific credit card types and then be careful about the ways in which you use them.
Balance Transfer
For the purposes of credit repair, credit cards offering a very low interest rate balance transfer offer could be ideal for your needs. Unfortunately these really low rates are often reserved for customers with high credit scores.
Even though you won't qualify for the very best rates around if your credit score is low, it may still be possible to find a lender willing to help you find a way to transfer your balances to another credit card. The rate might not be great, but it may be lower than the current penalty rates you're paying on your past due accounts right now.
When you transfer your balances for credit repair, the credit card lender is giving you an opportunity to prove your financial responsibility by keeping up with your new repayments. Your old accounts are paid down, which generates a positive listing on your credit report, and if you can keep up with your new repayments, your good payment conduct will also be reported.
These combined positive listings can help to increase your credit score and help you get back on track.
Prepaid Credit Cards
If you're serious about working on your credit repair, credit cards with a prepaid limit could be a way for you to give your credit score a quick boost. With these types of cards, you're only able to spend money you've deposited into the account from your own money.
Before you apply for a prepaid credit card, you should check whether the lender reports to the credit reporting agencies. If possible try to find a lender that will offer to report your payment activity as you continue to pay money into your account over time.
The best part about using a prepaid credit card is that you don't incur any interest charges on your purchases. When you're working on credit repair, credit cards and any other outstanding accounts you have are the first things you should work on reducing.
If you can find a little extra in your budget each month, try to make a few extra payments on each of your outstanding accounts so you're lowering your balance. You should also be sure not to charge anything else to credit while you're working on this plan. This will help you to reduce your total level of debt and catch up past due balances which should give you a boost to your total credit score. |