subject: Credit Builder Credit Cards - Bad Credit Repairing Tool [print this page] If you have defaulted on your previous financial commitments and damaged your credit score because of which you are finding it hard to get financial help from institutions then a credit builder credit card is what you need. Credit builder credit cards are specially designed for people with bad credit.
How credit builder credit cards work Credit builder credit cards are designed for those borrowers who, because of bad or no credit score, do not qualify to get normal credit card or any financial assistance from the system. Some companies dare to venture in the bad-credit credit cards market because the market is full of customers with poor or no credit scores. They take risk of lending to people with bad credit because in that market they can charge high interest. You should not use such credit cards for purchase purpose. The goal should only be to repair your credit rating using this card. The interest rate on credit builder credit cards could be as high as two times as offered on a standard credit card. You need to be wise when using it.
There are some prepaid cards as well which comes with credit builder, which in effect is nothing but a loan which you have to return to the issuer in 12 equal monthly installments. This works well in improving your credit score because the issuer inform two Credit Rating Agencies of your successful repayment. Prepaid cards boost your credit rating by as much as 40%. This is an easy way to build your credit score.
How to use credit builder credit cards to build a good credit score Before you begin using the credit builder credit cards you need to promise yourself that you will not repeat the mistakes you committed earlier, which destroyed your credit rating. You should only use it in a way to repair your bad credit not to pile up on that.
When considering various credit builder credit cards, you should check the details and read the fine prints to understand all the requirements. You would not like to be stumped the second time. Before applying for such cards, understand the requirements of issuer, and apply for one only when you are fully prepared.
As far the payment on the bad-credit credit cards is concerned: Do Not Default On The Payment Of Credit Builder Credit Cards. Nothing could hurt your credit score more than non-payment on credit repair credit cards. By making the payment on time, you will get some positive credit scores which will impress your future lenders, and you will be able to get a lone at a lower interest rate.
In the concluding paragraph, I would like to say that building credit score is a long process. It takes a lot of patience to do so, but damaging it is relatively easy, just miss out on couple of payments and it will start reflecting in your credit score. If you have been in the unfortunate situation where you have damaged your credit score, for whatever reason, you should consider taking credit builder credit cards to repair your bad credit. And once your credit score gets back on track, you should not let is falter.
