There are credit cards for folks just like you. If your credit score is in the range of 350-500, you don’t have a vast amount of options, but you do have some. The best strategy may be to get a secured card. Secured credit cards require a deposit when you set up the account. That money sets your credit limit. If you deposit $200-300, that’s how much your credit line is. If you don’t pay what you owe, the lender doesn’t lose out, they will take money from your deposit. If you are a model credit citizen and pay your bills promptly, over time you’ll raise your credit score and qualify for an unsecured card. When you upgrade or close a non-delinquent secured card, the issuer refunds your deposit.
Because you put up collateral, it’s easy to get a secured credit card. Keep in mind, the goal of getting a secured card is to build and boost your credit. Be sure to find out if the secured card you’re applying for is reports to the three major credit bureaus, Experian, Equifax (NYSE:) and TransUnion. If your secured card doesn’t report to them, it won’t help your credit history and negates the point of having the card.
What’s key is to do the right thing when you get your new card. “To start with, make purchases between 50% to 90% of the credit limit then when your bill comes the next month either pay it off or at least to 30% of the credit limit. What that’s doing is showing the credit card company and everybody that looks at your credit report that you are being responsible with the new credit that you have, this is the most important thing now on your credit report,” says Steven Millstein, a certified credit counselor and editor of CreditRepairExpert.org.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.