a growing rate of home
foreclosures, spiraling credit card debt, and even bankruptcy,
millions of Americans find themselves in the same predicament.
is, how to regain a solid financial footing and get back into
the good graces of lending banks and credit agencies.
dire as it may seem when you first find yourself strapped for
credit, bouncing back from a bad credit rating may, in fact, be
easier than you think.
a secured credit card
way to regain your good standing is to begin rebuilding your credit
history, starting from scratch. A secured credit card will almost
immediately get you back on the road to full financial recovery,
albeit slowly to start, and eventually get you upgraded to a regular
credit card within a year.
is based on the assumption that you already have $200 - $500 to
keep in your bank account as security against default. Hence,
the term "secured credit card" if you don't pay
your bill, the credit card issuer simply takes what you owe from
your bank account.
Secured credit cards are not all alike
Not all banks
or credit card issuers offer the same advantages to consumers
looking to rebuild their credit standing. For the best deal, be
sure to look for the following before you apply:
at restoring a good track record will remain in neutral unless
the three major credit bureaus - Equifax, Experian and TransUnion
- are aware of it. First, ask your bank if the card issuer reports
to all three agencies before you apply.
new card convert to an unsecured card after 12-18 months of
on-time payments? A solid payment history often will result
in an upgrade to a regular credit card in about 12 - 18 months..
annual fee and NO application fee. Avoid greedy card issuers
who may charge exorbitant fees for helping you regain your
financial freedom. As with any product or service, it always
pays to shop around.
Pay it back on time and without fail
a secured credit card may be the best investment you'll make for
quickly reestablishing your good name IF you follow the rules.
Keep in mind
that your card is a test of your new-found creditworthiness, so
maxing out a secured credit card is always a bad idea. Experts
advise keeping charges down to a minimum of 40 - 50 percent of
your available limit while you regain your financial footing.
bill in full every month is not necessary. Paying-off the monthly
charges - and on time - remains the cardinal rule to prove that
you're no longer a credit risk.