Better Your Credit Even With After Credit Denials
We are living in the age of consumer credit and household debt. People living the United States are waking up to find themselves sinking in the mound of debt that they seem to have created. It is not far fetched these days to find people as much in debt as $20,000.
As the pressures of mounting consumer debt become an issue for more and more people, the demand for legitimate and proven ways to rebuild your credit history is on the rise. The word "budget" conjures up extreme images of depriving oneself of the foods one likes or more extreme visions of starving oneself pop up. However, a proven formula for debt management and the rebuilding personal credit and credit scores using a specific type of credit card dispels such visions.
Not only are these credit cards beneficial, they also provide for some consumers the only way out, especially if they've been denied a bank account or traditional credit card. Given that it takes two incomes in most households and a great majority of men and women both are in the workforce these days, there is hardly any time to prepare budgets and investigate ways to increase their credit scores.
They say that the way to eat an elephant is one bit at a time. Let's take our first bit and analyze both secured and pre-paid credit cards, and the cons and pros with each for your situation.
Secured Credit Cards Pros - Obtaining a secured credit card account is a quick, easy, and affordable way to build your credit. These cards will also help to better your damaged credit by slowly rebuilding it. They are used the same way you use any other card and are taken by vendors anywhere a regular debit or credit card can be used.
Cons - One of the major drawbacks to this type of card is that to secure the card you must put down a $200 to $250 deposit with your application. For many this may be a tough requirement. These cards also tend to have much higher interest rates (15% or higher) and additional charges such as an annual fee (usually around $50). Despite these drawbacks, for many looking to rebuild their credit, these cards make sense.
Pre-Paid Credit Cards Pros - Pre-Paid Credit Cards can be an excellent tool because they allow you the convenience of actually using your own cash, not borrowed funds. They look like the same credit cards that you see everyone else swiping, and can be used in all of the same places. In place of a credit card company determining what the limit on your card will be, you determine the limit on your own card. You simple "load" the amount of money you desire onto the card. Getting approved for this type of card is nearly a guarantee, even if you have credit problems.
Cons - If you are looking to rebuild or establish your credit however, beware. These cards may not report your repayment history to the credit bureaus. If the creditor does not report your account, this type of account will not help you improve your credit. By carefully selecting these cards, you can assure yourself that you receive the most bangs for your proverbial buck.
You might also consider that Pre-paid cards cannot be used in all situations. For example: hotels and car rental agencies may not allow you to use a pre-paid credit card to secure your rentals. It's always a good idea to call ahead first and ask each company their policy before entering into any transaction.
As the pressures of mounting consumer debt become an issue for more and more people, the demand for legitimate and proven ways to rebuild your credit history is on the rise. The word "budget" conjures up extreme images of depriving oneself of the foods one likes or more extreme visions of starving oneself pop up. However, a proven formula for debt management and the rebuilding personal credit and credit scores using a specific type of credit card dispels such visions.
Not only are these credit cards beneficial, they also provide for some consumers the only way out, especially if they've been denied a bank account or traditional credit card. Given that it takes two incomes in most households and a great majority of men and women both are in the workforce these days, there is hardly any time to prepare budgets and investigate ways to increase their credit scores.
They say that the way to eat an elephant is one bit at a time. Let's take our first bit and analyze both secured and pre-paid credit cards, and the cons and pros with each for your situation.
Secured Credit Cards Pros - Obtaining a secured credit card account is a quick, easy, and affordable way to build your credit. These cards will also help to better your damaged credit by slowly rebuilding it. They are used the same way you use any other card and are taken by vendors anywhere a regular debit or credit card can be used.
Cons - One of the major drawbacks to this type of card is that to secure the card you must put down a $200 to $250 deposit with your application. For many this may be a tough requirement. These cards also tend to have much higher interest rates (15% or higher) and additional charges such as an annual fee (usually around $50). Despite these drawbacks, for many looking to rebuild their credit, these cards make sense.
Pre-Paid Credit Cards Pros - Pre-Paid Credit Cards can be an excellent tool because they allow you the convenience of actually using your own cash, not borrowed funds. They look like the same credit cards that you see everyone else swiping, and can be used in all of the same places. In place of a credit card company determining what the limit on your card will be, you determine the limit on your own card. You simple "load" the amount of money you desire onto the card. Getting approved for this type of card is nearly a guarantee, even if you have credit problems.
Cons - If you are looking to rebuild or establish your credit however, beware. These cards may not report your repayment history to the credit bureaus. If the creditor does not report your account, this type of account will not help you improve your credit. By carefully selecting these cards, you can assure yourself that you receive the most bangs for your proverbial buck.
You might also consider that Pre-paid cards cannot be used in all situations. For example: hotels and car rental agencies may not allow you to use a pre-paid credit card to secure your rentals. It's always a good idea to call ahead first and ask each company their policy before entering into any transaction.
posted by Debt Consolidation Loan at
5:23 AM
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