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  • Which Credit Cards are the Best for Someone with Bad Credit?

    Which Credit Cards are the Best for Someone with Bad Credit?

    If you have bad credit, it can feel next to impossible to dig your way out. It’s hard to get approved for loans, you have a hard time saving and getting ahead, and everything can feel like an uphill battle. When you’ve got bad credit, how can you right the ship and get yourself back on track?

    One of the best ways to rebuild bad credit is to get a credit card with low fees up front and that report on your credit to all three bureaus. Ideally, you want a card that offers pre-qualification checks, too. Today we’re going over how you can rebuild your credit, and what some of the best cards for doing so are.

    Best Credit Cards for Bad Credit

    Rebuilding Credit with a Credit Card

    When it comes to rebuilding your credit, your best bet is going to be operating on a very small scale. Set yourself a small budget, something you know you can easily pay off every month and put that on your card. Maybe just get gas, or just buy groceries with the card, and nothing else. Never float a balance past a month and make regular payments.

    While you’re doing this, keep an eye on your credit. Make sure the positive changes are being reported regularly and that your credit is moving in the right direction. This ensures that you’re doing the right thing and that your credit is being repaired.

    Applying for Cards

    Don’t look desperate by sending out a huge burst of credit card applications. This is a surefire way to put a big dent in your credit. Each time you apply for a credit card, a hard inquiry is placed on your credit, which can negatively impact it for as much as twelve months. Make sure you only apply for a few cards and consider going after pre-qualification cards.

    Pre-qualified cards do a soft inquiry of your credit, which allows you to avoid the issue of having your credit tanked by repeated inquiries. Once you get your card, you can begin rebuilding your credit with it, so the soft inquiry is well-worth the effort.

    Capital One Secured Mastercard

    The Capital One Secured Mastercard is a great pick for anyone looking to rebuild their credit. The card has no annual fee, and you can set down a small amount of money up-front for a credit line of $200. That’s enough for you to buy groceries on or buy gas, and then pay off before the end of the month.

    When you make enough payments on time, you’ll even get an increased credit line that allows you to put more expenses on the card. Not to mention, you get to pick your own due date for the money. That means you can set up your bills to hit when you get your paycheck, so you’re never late on your card payment!

    Milestone Gold Mastercard

    You can set this card up to pay off bi-monthly, allowing you to keep a tighter leash on your spending and help you get into good spending habits. The card doesn’t require a security deposit and it offers $0 cash advance fees the first year. In short, if you’ve got a prior bankruptcy on your credit history, this is a card worth looking in to. Just watch out for some of the minor fees, like for adding another authorized user or late payment fees.


  • How to Use a Credit Card to Repair Your Credit

    How to Use a Credit Card to Repair Your Credit

    If your credit score is less than ideal, you might be wondering what the best way to repair it is. While there are a number of ways to address your credit, one of the most surefire ways to pull it back into a favorable position is to use a credit card. This might sound counterintuitive if your credit score is already bad due to credit card debt, but hear us out.

    There are a few rules of thumb you need to follow with any credit card, but they go double for when you’re using them to repair your credit. Today we’re going over some of the basics to help you fix your credit standing. If you follow these tips you should see your score going up gradually, and in a few years you’ll have great credit!

    Remember, most of all, to be patient. Your credit score isn’t going to become excellent overnight, and requires you to work diligently at paying back your debts and paying bills on time to stay high.

    Paying Off Outstanding Debts

    Let’s begin with the most pressing issues. If you have a lot of outstanding debts that are dragging down your credit score, it’s time to hose them down. Let’s say you’ve got debts on three credit cards that are bearing down on you. Find the one with the highest interest rate and put any extra money you make towards paying it off. Make minimum payments on your other debts while you do this.

    By using this “target priority” technique, you can begin to chip away at the worst of your debt. This does two things for you. Firstly, it gets all that extra interest the debt would have accumulated out of the way. Secondly, it means your credit score will start to get repaired as your payments stay regular and your debt-to-income ratio evens out.

    Using a Small-Limit Card

    On the flip side, if you have no credit history or a bad credit history and don’t owe much in debt right now, you’ll want to use a credit card. For instance, let’s say you’re fresh out of college or school, you have a consistent job and you’re looking to get a car loan but have no credit history. Don’t sweat it! Just apply for a small-limit credit card with no annual fees and a low interest rate. Something really small, even with a limit of $100 or $200, works well here.

    Just use this card for small purchases, like buying groceries or getting food at a restaurant. Be careful to only spend what you can afford to pay back before the end of the month so that you don’t float any balance and accrue interest owed on it. After a few months of consistently using, and paying back, this small credit card, you’ll see your credit history start to build up.

    Good Spending Habits

    As another example, if you’re repairing your credit history after a rough patch, you can use a similar approach. However, with a bad credit history, as opposed to no credit history, it may seem difficult to find a credit card that seems like a decent deal. In such cases, even if you find a card with a high interest rate, consider using it just for making small purchases.

    Even if a card has a high interest rate and a low limit, using it consistently and simply paying it back before the end of the month can be a great way to show credit agencies you’re more responsible than you once were. By paying the bill off monthly, you’re able to both keep the interest from building up while also improving your credit score.


  • Best Ways to Check Credit Score

    Best Ways to Check Credit Score

    If you’re looking to make a big purchase, like a car or a house, odds are you’re going to need a loan. The way lenders check to see if you’re eligible for that loan, of course, is your credit score. If you often pay bills on time and are financially secure, your score should be high but you should regularly check your score.

    Grab hold of your financial potential with free information about your credit score. Knowing your credit score is important because it helps you decide what your buying power is and what areas to focus on to improve this important score.

    There are many factors that go into determining a credit score, including employment status, credit history, and financial consistency. There are also several different types of credit scores rather than a standard way to measure creditworthiness. Although banks and lenders may have their own method to determine a credit score, there are ways that general consumers can monitor their credit activity and keep on top of the score as it changes over the years.

    If you’re looking to check your credit score you’ll want to do it for free. That’s where these free credit check sites come in!

    Best Free Credit Reports

    Credit.com

    Credit.com allows you to see your Experian and VantageScore results for free. VantageScore is a newer model of credit scoring that is usually more up-to-date than the traditional FICO score. You have to sign up for an account with Credit.com, but it’s a free process. The site is known for its credit report card, a quick glance at which things go into your credit. This way, you can see what factors you may need to address to get your score higher!

    Credit Karma

    Credit Karma has become the most popular of the free credit monitoring sites for many reasons. You’ve likely heard of this one. Credit Karma offers scores from TransUnion and Equifax, and both are shown as VantageScore. Credit Karma is a free site as well, and they don’t share customer information. If you’re looking for a no-frills credit check, you’re looking for Credit Karma. They offer a great mobile app, too.

    Quizzle

    Since 2008, Quizzle has been helping its customers understand their credit history and providing free access to their full credit report and credit score. Quizzle offers free Equifax and VantageScore reports. Once every three months you can see a free report of your score. Quizzle technically has a premium account too, though you’re better off just using the free functions. The free functionality doesn’t require a credit card, too.

    WalletHub

    WalletHub offers personal financial tools to users online. Their main product is offering a free daily credit score and report associated with it. WalletHub requires you to take a pre-screening questionnaire before you get your free score. Once you answer a few basic questions, such as your income and the last four digits of your Social, you get a TransUnion credit score. The report is similar to Credit.com’s credit report card, showing you what factors influence your score the most.