How to Rebuild Your Credit Like a Rock Star
The final step of credit repair is re-building your credit. After you’ve disputed items on your credit report and (hopefully) they have been removed, it’s time to establish new credit.
You could try to start this process in the middle of repairing your credit, but most professionals feel that you really shouldn’t be doing too much while they’re working on your profile and trying to get items removed.
You should be practicing good payment patterns by not being late during the credit repair process as well.
Even if you haven’t had much luck and your credit score only improves by a few points, there are ways to re-build credit. For example, if you still have only a 605-credit score, which is still on the lower side, you may not get approved for the unsecured credit card of your choice but there’s still no harm in applying for unsecured credit.
As long as you haven’t been applying for credit in the recent past, it’ll just affect you with getting a inquiry on your credit report. An inquiry will probably affect your cost for 5 to 10 points but it’s only temporary. Store cards will be easier to retrieve than credit cards from your bank.
Apply with creditors and credit card companies that specialize in helping consumers with rebuilding their credit
You should try to find easier creditors that have programs to help consumers like yourself build credit. Credit One Bank is one such option. They do offer low credit lines, but they have a high percentage of success rate for consumers that are looking to rebuild their credit.
They even have an online application where you can get preapproved without affecting your credit score.
However, if you do get rejected, there is still hope.
Secured Credit Cards
Secured credit cards are very helpful in allowing consumers to get a good credit score when re-building credit. In order to get your hands on a secured credit card, you first submit a deposit close to or equal to your credit line. If you submit a $200.00 deposit, you will have a credit line of $200.00.
What’s the difference between a secured credit card and a debit card? Though they may seem similar in concept, using a debit card won’t help you re-build your credit. Lenders and creditors need to know you are trustworthy with lines of credit. Therefore, if you make charges to your secured credit card on a regular basis and pay off all your balances in full, you have gained creditworthiness. After a certain period of time (i.e.: usually 6 months – 2 years), if the creditor deems you trustworthy with that line of credit, you will get back your deposit and they will open an unsecured line for you.
All credit accounts on your report are referred to as “trade lines.” By adding new trade lines to your credit report, you can increase the amount of overall credit you have access to, which will in turn improve your debt-to-income ratio.
There are companies in the financial landscape that actually sell trade lines, but we don’t really recommend this avenue unless you can find a very trusted source.
Become an authorized user
An easy way to add trade lines is to be added as an authorized user on a well-established credit account. You won’t need to use the credit card. The process is also known as “piggybacking.” There are certain companies that charge high fees for piggybacking on random users’ accounts, but again we don’t recommend going down that route.
If possible, ask a friend or family member with good credit if you can be added as an authorized user. In this way, you’ll be more acquainted with the primary user’s financial habits.
Need Help Re-building your Credit?
If you sign up for Sky Blue Credit, their team will help you establish new credit in the form of secured credit cards, unsecured credit cards, and tradelines. Sky Blue Credit is our first choice for the best credit repair company. One of the main reasons is because they do not have salespeople or call-center. That is not how they operate. You can call them for advice at any time without pressure and you can ask him about how they help consumers to rebuild credit. They also have a 100% ironclad moneyback guarantee.
10% of your FICO score consists of “new credit.” By getting negative items removed from your report and creating new credit, you’re taking care of all aspects of the credit repair process. Before you know it, you’ll be on the fast track to re-vitalizing your credit!