Credit Card Shopping for Fun and Profit: Prepaid Credit Cards
If you have ever had bad credit or an insufficient credit history you know how difficult it can be to correct. There are a number of reasons why you might have credit problems – if you are new to the United States or are recently divorced, or have recently declared bankruptcy you probably have credit issues. No matter what the reason is, you can start today to rebuild your credit, and Prepaid Credit Cards can play an important role in establishing good credit.
Here are six steps that you can use to turn your bad or non-existent credit into good credit:
1) Open a checking and savings account at a local bank. If you don’t have these already, get them, because credit agencies want to see that you have both. Owning a checking account lets them know that you have the tools you need to pay your bills and a savings account shows that you are thinking of the future.
2) Get a copy of your own credit report. If you are new to the United States or are young you may not have a credit history on file. If you have had problems with credit in the past, those issues will probably be on the report. All of the three major credit reporting agencies – Experian, TransUnion and Equifax – will provide you with your credit report free and on-line. Just search Google for “credit report” and find one that’s free and with no hidden charges.
3) Make sure all of the personal information on your credit report is accurate and complete. You may find that some of the basic information is incorrect, such as your phone number, address or Social Security number. Review all of the basic information on your report, and if you find errors correct them by writing to the issuing credit bureau.
4) Check credit references and information on your report and make sure it is accurate. You often can find bad credit references that are inaccurate or wrong. Look for accounts that don’t belong to you. If you find errors, dispute them by writing to the issuing credit bureau. Information on writing to correct or dispute information on your credit report will be included with the report when you receive it.
5) Shop on-line for a prepaid credit card. Secured, or prepaid credit cards are a form of secured loan. You can get one no matter how bad your credit history is. The issuer will require that you deposit a small amount of cash into an account – then they’ll issue you a credit card with a spending limit close to the amount of your deposit. Shopping on-line for a prepaid card lets you compare different cards, pick the best one and apply very easily and privately.
6) Use your new credit card responsibly. Only charge as much on your new prepaid credit card as you can pay off each month. Make sure you pay your bill on time all the time. Once you have shown a willingness to do that for twelve months or so, call the credit card issuer, make sure they are reporting your good performance to the credit bureaus, and request an unsecured account.
Bad or insufficient credit can haunt you at times when you need the trouble the least. Using the steps outlined above you can begin today to establish good credit so that it will be available when you really need it.
