ReadyForZero handpicked the best credit cards to help you rebuild your credit score.
These credit cards can help you improve your credit if you have no credit history or bad credit. Sometimes they include annual fees and higher than average interest rates but the minimum credit scores required to qualify are much lower (in fact, in some cases there are no minimums to qualify). Consider these cards if you are looking for ways to build or improve your credit. As with other credit card products, be sure to consistently make on-time payments in order to keep a good credit history!Advertiser Disclosure
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If your credit score is less than perfect, you might have some trouble qualifying for the majority of the cards out there. Fortunately, there are cards specifically designed for people trying to reestablish their credit score.
Although these cards might not have the most favorable terms, it’s a way to prove your creditworthiness to your creditors. Once you have re-established your credit, you can always work your way up to get better rates and terms from your creditors.
There are generally two types of credit cards that can help you rebuild your credit score: secured and unsecured.
Anyone with any credit score can apply for a secured credit card. In order to apply, the applicant must secure their credit line with an initial deposit of $250-$10,000. The amount you decide to secure it with will be your new credit line.
When you apply for a secured credit card, always make sure that the creditor is reporting to all three major credit bureaus.
The unsecured credit card doesn’t require you to put an initial deposit. These cards typically carry a higher interest rate and will generally have a lower credit line. However, most of these cards will allow you to increase your credit line after 5-6 on time payments.
The number one factor in determining your credit score is your payment history. Your payment history accounts for 35% of your credit score. It’s important to always make sure you’re paying your bills on time after obtaining a credit card. Set up bill reminders and make sure it’s synced to your calendar and always make sure you’re getting email notifications. You can always ask the creditor to move the pay date that coincides with your pay schedule as well.
The second most important factor is your overall DTI (debt-to-income) ratio. It’s recommended that you keep this number under 30%. So if you’re overall credit line is $1,000 try not to go over $300. Your DTI ratio accounts for 30% of your credit score.