How to Fix a Damaged Credit History Using Rebuilding Credit Cards

How to Fix a Damaged Credit History Using Rebuilding Credit Cards

By James Bracco

Many people now find themselves over burdened in debt simply because they failed to act responsibly and took out many unnecessary loans during the boom times before this recession. These easy qualifying loans had been available to just about anyone with a pulse just a few years ago. Over consumed with the need to have more and more things, many people have found themselves with credit cards at their limits.

Additionally, they have refinanced their homes and taken out personal loans only to find they have no means to pay down all of this debt. As a result, they have had problems paying their bills in a timely matter and this has negatively affected their credit history.

If this situation sounds familiar, you are not alone. It has become so pervasive that credit card companies now know they can make money from you by offering rebuilding credit cards that actually help you to fix your damaged credit. Yes, the same people who probably got you in this position are now there to help you out. So what is the catch? It is simple; they make very good money off the annual fees they get to charge you for this service. In addition, realistically, it is a service you now need, so you are not in a position to complain, as these cards actually work. Rebuilding credit cards are quite simply credit cards that report you to all the major credit bureaus, and do so monthly. This is the main reason for having such a card. Therefore, since you now know what these cards do for you, getting one, or two, is just the first step in rebuilding a damaged credit history.

First, my advice is to work on repairing your credit history. When you have damaged your credit scores, you chances of getting any new credit or loans also are reduced. As you keep applying at place after place, denials repeatedly happen. This is unless of course you seek out those who openly accept bad credit. In this situation, you will often see that your only option is a secured card. These are not cheap, but they are very useful if they are your only alternative.

However, if you make efforts to acquire only new credit lines that report positive information, it will then be a lot easier to rebuild your credit history. When you have shown these companies that you are sincere in making your payments in a timely manner, you will begin to earn their trust again. In addition, as you begin to make positive changes to your credit scores, your chances of getting trust restored improves as well. However, this will take dedication and persistent effort on your part. You must adhere to making your payments on time and do not take out any new loans, except those designed to rebuild your credit ratings.

When you plan to open any financial accounts in your current condition, you will want to check out options that openly state they accept individuals who have a damaged credit rating. In doing this, you will once again make your credit scores better as your gradually build up new accounts that report your timely payment history. Again, make sure that you do everything as you have agreed and do not squander these opportunities given to you. If you pay this and any loan as agreed and you have shown your determination in paying off all your debts, you might just rebuild your credit rating faster than you think.

Furthermore, when given one more chance to make use of any credit cards, you must do so responsibly this time around. You have to make sure that you do everything within your means to avoid overspending and exceeding your credit limits. You must use your credit card as a backup plan only. Yet, when use a rebuilding credit card, it is a good idea to use it now and then instead of paying cash for something, and then pay the bill in full as soon as you get it. This will also improve your credit score.

When your credit rating starts to improve and you get your financial well-being in order, you will feel a lot better mentally as well. You can also seek help for debt relief from local non-profit groups if you qualify as low-income and currently have major debt problems. Many organizations are willing to extend their help for those who have suffered from the current economic turmoil. If this sounds like your situation, then you need to take care of your current problems before worrying about acquiring any new cards or debt. If you are one of those fortunate people on the way to recovery, then now is the time to start rebuilding your credit.

James Bracco is an author covering all areas of finance, including credit cards. One my interests is “Rebuilding Credit Cards” because many people are confused about how these can actually help you fix a bad credit rating.

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