Im told I have a lousy credit score for various reasons but Ive never had a credit card. How can I get one?

Question

Im not in debt now and I own my car paid in full.The only ones ive been offered are insured or secured cards and I see them like a debit card.Will these cards proper use be the doorway to a real credit card or not?

Answer 1

You may have a low credit score simply because you have no credit. One of the factors that goes into making up a credit score is the ratio of total revolving dept to the total credit line. If you have no debt and no credit lines it can count against you. A favorable balance of revolving debt to the total available credit is even more important than making payments on time. Secured credit cards might work but you must be very careful because some charge exorbitant fees. A better route might be to apply for a couple department store charge cards, gas credit cards, and the like. Use these for a while, maybe 2-3 months, then try an application for a regular credit card and see what happens.

When I was recovering from bankruptcy about 20 years ago, I had several secured credit cards and I can tell you for a fact that YES, secured credit cards DO report to the credit bureaus.These type of cards can be a viable method to rebuilding credit.

If you know what you are doing, you can even be 29 days past due on credit card payments and installment loans and your payments are still reported as 'current'.

Answer 2

Yes. They will lead the way to proper credit cards. If you get a secured card they require that you pay some money towards them as a security, and they will send you a card with a low credit limit (like $200-$500).

Companies check your credit payment yearly and you can always request for a higher credit limit. If they do a check and see that you have paid on time, no late payment, nothing bad, then they will increase your credit limit.

They are not a debit card.

A debit card is directly taking from your checking account. The money you put towards the card is kind of like a security blanket for the company if you over charged and do not make payments. After you had the card for about a year or little over a year then you can request the money to be given bank to you. They will send you the money.

In fact the money you sent in to them for the card is not touch by you or them. It is placed in a savings account. You recieve it back.

The card works just like any credit card. You make a charge on it, they send you a bill, and you pay it off. They do not touch the money that you send in, in fact the money you sent in is placed in a savings account. They do not touch it, you do not touch it.

After you use it and show that you have a good standing you will be able to request a credit limit increase usually after a year.

So yes this card is a proper use, an open entry for real credit cards. It helps build your credit if you have none, fix your credit if your credit is bad.

The credit card is reported to all 3 credit companies and it shows that you have a credit card. It'll show the spending limit, if you paid late or if you are in good standing. It will show something.

Answer 3

I was in the same situation for years. I just got my first credit card about 4 years ago. I am 35. No one would give me. I didnt have bad credit I just had no credit. I applyed for a department store credit card and I accually got it. I used it a couple times and paid it off each month and there after I was getting and still am getting pre approved credit apps in the mail all the time. Just dont go crazy like I did with getting credit cards. Once I got my first one I got 13 more after that,. Yes thats 14 credit cards at one time. And yes I had debt on all of them. I dont have that many now. I only have about 5. But just be careful. Good luck

Answer 4

First things first... get a copy of your credit reports from all 3 credit reporting companys. Federal law states you are entitled to a free credit report from the big 3 annually.

Extract:
Check your credit for free: Under federal law, you’re entitled to a FREE copy of your credit report once every 12 months. Log on to annualcreditreport.com, or call 877-322-8228.

Verify that the information is accurate. If not they have a way for you to dispute inaccurate or wrong information. Also, for about $5-7 a report you can get a copy of your credit score and the reasons (both good and bad) of why your score is rated this way, and if bad what you can do to improve it.

Department cards are usually pretty easy to get. Say a Dillard's , JCPenny or Sears cards. Make small purchases and pay them off. Good credit never goes away and bad will only stay on for up to 7 years max. (Bankruptcy however, stays for like 15).

Answer 5

You have a lousy credit score because you've never demonstrated that you can handle credit. You need to get a regular credit card and start making regular payments. Secured cards tend not to report payments, so they're useless. Try getting a department store card first, or a gas station card.

Answer 6

Yes, secured credit cards will provide with credit history, and increase your beacon score, and depending on the secured credit it will become an unsecured credit card. The best ones are thru the bank where you have your checking account. be sure to ask when is your deposit returned.

Answer 7

Mortgage payments? Rent? Utilities? Phone? Car pmts? were you late paying them?) Overdue student loans? Order your FREE credit reports and those should shed some light.

How do you know you have a low score? Ask who told you.

OR beware of Id. theft. Don't delay...it could get worse evey day!

Answer 8

I agree totally with you. Borderline entrapment if you ask me. For what it is worth this might help. There is a free download software look at my profile for the url finance. The software gives you a perspective of where you are with your debts and gives a strategy on how to clear them. Its shareware software that I used with some success. It just might help you.

Answer 9

It's one of the evils of being responsible and living within your means.
How can a credit company be sure you can pay them back...if you have no record of doing so......kinda stupid if you ask me....you've already demonstrated that you are responsible and not a splurge.....but then again credit card cos. love splurges.

Answer 10

Get a co-signer who has a good credit score, and go to a local bank. Have the co-signer apply with you, and you should be able to get one on their credit history.