By financen | September 14, 2008 - 11:19 am - Posted in Credit Card

It is impossible to get approved for a good credit card at zero percent interest rate if you do not have a good credit history in your favor. And you can establish good credit only if you are using a credit card. Because of this no win cycle, most of the people are not able to build their credit ratings and apply for best credit. The fact is that there are cards available for people with different credit ratings and you should be able to rebuild your credit history using those cards.

If you are applying for one of the top 10 credit cards, you may get approved for a credit card according to your present credit ratings. While a student will naturally apply for a student card, a person who is not a student and has a non-existent or bad credit history will apply for secured credit card or a card with a co-signor.

Secured credit cards: when you apply for a secured credit card, you deposit cash up front in a savings account or CD. You will get a credit line as per the funds deposited into the account. The card issuer will maintain a lien on the deposit account. If you do not make timely payments on the secured credit card, you will lose the deposit amount.

Unsecured or regular credit cards are more commonly used than secured credit cards. If you have good credit ratings, you should be able to apply for best from the top 10 credit card companies. With an unsecured credit card, the issuing bank has no legal rights to take away your assets if you have defaulted in your payments. They can either sue you or force you to file for bankruptcy during their collection attempts.

A secured credit card carries a higher interest rate in comparison to the unsecured credit cards. These types of cards are good for rebuilding your bad credit.

Credit cards with a co-signor: When you apply for a credit card with a co-signor, the other person having good credit ratings guarantees payments to the credit issuer if you are defaulting in your monthly payments. This can be a risky move for the person with good credit ratings because if the co-signed debt goes into default, the co-signor with good credit ratings will be asked to pay the balance in most cases. If payments are not being done, the person with good credit ratings not only affects his credit ratings, but will be asked to pay the full balance.

Repairing Your Credit: Everyone must check his credit report and see whether all the items reported on the credit report are accurate in all terms. If you find any inaccurate items which can be quite obvious, because the credit reporting agencies handles billions and billions of consumers’ credit information, make a note of all the inaccurate negative items and get it investigated immediately. You are entitled to get a free copy of your credit report if you have been denied credit, insurance or employment. You can also request for a free copy if you can prove that

(1) you are unemployed and plan to look for a job within 60 days

(2) you are on welfare or

(3) your report is showing inaccurate items because of some fraudulent activities.

There is no charge when you are disputing any inaccurate information on your credit report. Simply fill the dispute form and submit it with any supporting documentation. Once you find your credit information to be accurate in all terms, you can apply for a credit card with confidence. Make sure that you use the credit card responsibly and make timely payments. This will enhance your credit history in the long run.

This entry was posted on Sunday, September 14th, 2008 at 11:19 am and is filed under Credit Card. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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