Best Credit Cards for Bad Credit Score
Do you have Bad Credit?
First, you need to find out your credit score which determines what kind of credit you have. When you are reviewing a credit score where the range runs from 300 – 850, you can generally assume the following:
Great Credit: 760 – 850
Good Credit: 680 – 760
Fair Credit: 620 – 680
Bad Credit: Below 620
There are several reasons you can fall into the “bad credit” category:
- You don’t make timely payments
- You have an account in collections
- You have declared bankruptcy or you are going through foreclosure
These faults can make you a risky candidate to get an approval for credit cards or loans.
It is also likely that you do not have any credit history at all. In either case, responsible use of credit cards can help you build or boost your credit score. If you manage to make all payments on time and keep the credit card balance low, your credit card score will rise with time. Subsequently, you will have access to better credit card offers and loans.
How can I fix horrible credit?
Trying to quick-fix your horrible credit is not a good idea. It is only going to make you fall flat on your face. When it comes to credit histories, credit bureaus pay attention to good credit behavior and that can only happen over time. That is why you should always beware of advice that promises it will fix your bad credit in no time at all. It just does not happen that way. The best advice you can get for improving your horrible credit is to manage it in a responsible way over time. Start repairing your credit history and your credit score will show a corresponding increase over time. Here are tips to fix bad credit.
It starts with a credit check
This is the first thing you can do. Unless you know exactly what your credit report looks like, how are you going to fix it? You can request a free copy of your credit report from the three credit bureaus in the United States. You can then start checking for errors. Errors do happen and even if you can find only a small one, it can better your credit score. Most importantly, you need to check whether there are any late payments incorrectly mentioned on your report. If you find an error, you can take it up with the concerned bureau or agency.
Payment reminders
It is easy to forget to pay your credit card or loan payments on time every month with busy work schedules. Why not set up payment reminders? Most banks have online portals today which make it easy to set up payment reminders. Some will also allow an automatic transfer of money to your credit card companies on time but since they will only make the minimum payments due, it may not be a good idea to completely depend on these. Payment reminders which instill in you money management skills are a better option.
Reduce your debt
In today’s world, most people are in some sort of debt. If you want to fix your horrible credit, it may well be because you have not paid attention to reducing your debt. Taking solid steps to reduce the total amount of debt you owe, whether it is to credit card companies or on your house mortgage, is essential. For this, you have to come up with a solid payment plan and then start reducing your debt. Being on top of your debts and making sure that repaying them is your top financial priority every month is very important.
Stay current on your payments
Your horrible credit may also be because you have missed a lot of payments. This is certainly not a good thing. Staying current with your payments is important because the longer you take to pay your bills; the worse it is for your credit score.
Good credit behavior is an important ingredient to financial well-being. If you have taken it for granted, it’s high time you sat up and took steps to improve your bad credit history.
Next: Best Credit Cards for Fair Credit
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