How a Secured Credit Card Can Help Rebuild Bad Credit

 | Capital Markets

Having a credit card without a credit history is difficult. A low credit score can also be a reason in difficulty to obtain a credit card. Bad credit is detrimental if you are looking for getting a credit card. But you can make a better credit score with new credits. If your bank or issuers are reluctant to provide you with a credit card for your past issues or bad credit, then you can obtain a secured credit card. It will give you a sigh of relief and have to rebuild your credit. Just like a conventional credit card is a secure credit card. In all of the conventional cards, an individual has to make the purchases of payments from the limits of the cards. Secured credit cards can be used to make purchases in the same way just as conventional unsecured cards.

In a more precise and better way, an individual can get a credit score ameliorated if they had bad credit. Your secure credit card limits the spending to about 35% and less for the amount of credit you have, leading to a benevolent impact on your credit score as suggested by experts. By making your dues on time you can greatly improve your chances of securing an unsecured credit card as your credit score is enhanced with timely payments. But in secured credit cards, a customer is required to make a security deposit against the limit imposed on the card. Between 100% – 50% is the limit of the secure credit card. This means that if you have a deposit of 200$ then the limit will be 100 $ – 200$ respectively. Secured credit cards come up with numerous fees. So an individual needs to e cautious before purchasing it.

Timely payments– By making payments on time you can help get good credit. Secure credit cards can prove to be beneficial to worthwhile in getting a great credit. Paying your balances on time displays to the bureau that you are credible and thus can achieve a good credit. Several ways to remove your debts can prove beneficial. Your secured credit card can help you get a payday loan. Thus helping to clear off your dues and establishing a good credit history. You can achieve this by making marginal purchases in a month and then pay off your bill on time. You can also avoid interest build-up by paying off the amount on time.For an organic credit score paying off your dues on time is beneficial. This is also a factor that affects credit score. Increase your minimum payment every month. You can easily dictate that you are capable of pay off your balances by paying off more than the balance and decreasing the ratio of utilization of credit. You can keep your debts low by making several payments. If you entire amount in a month no surety will not create a negative effect on your credit score.

High Balance– You can get your credit history reshaped by making a good security deposit. The more security deposit you have for a secure credit card the more limits you will have and thus dictating to the issuer more balances. Fewer balances are one of the reasons for low credit score.

Set priority- Make payments on time. Even if you’re planned and coordinated then also there are chances that you may forget to make a payment. Create popup or reminders for your payment dues. You can also do this with your bank and the issuer. Get yourself notified a reminder before the due date and help yourself create a good credit for you.

Reminders-Yet many people forget to make payments on time even after continuous reminders. In these cases, you can generate an automatic debit facility. Get your card activated for auto pay mode. This will ensure automatic deduction and timely deduction of remaining balances for the purchases you have done in the month. You should keep sufficient balances for this purpose failing to which you may get yourself a bad credit instead of good ones. So always be vigilant enough and ensure you do have a sufficient amount in limits to pay off your dues. Secure credit cards aid an individual to get better credit history or to lay the foundation for the one by notifying the information to 3 credit bureaus.

Buy following these concrete advices given above you can improve your bad credit score. You just have to remember that the way you take your finances in your considerations and how you manage them affects your credit history. If you have proper finance management then you can build a great foundation of good credit score using secured credit cards.