Posted on: Mar. 12, 2017 in Debt, Money, Credit, Credit Score

There's a multitude of ways to build or rebuild credit. Deciding which tactic to use first depends largely on what’s lowering your score. If you’re behind on bills, you need to get current. If you have too much debt, you need to pay it down. Once you’ve taken those steps, you’ll need to start showing some positive experiences with credit. Using credit responsibly and carefully is one way to do that. But if you don’t have access to credit because of your score, one option is a secured credit card.


A typical credit card is unsecured – this means that if you don’t pay back what you borrow, the credit card company has nothing of yours held in collateral. It loses. A secured card is the opposite, which is what makes it so much easier to obtain. You put up your own money and the card issuer will give you a card that will look and act like a credit card. There are secured cards available for as little as $200. Usually the amount you deposit will be your spending limit.

Each month, you should pay off what you spend with the card. This builds that positive payment history that is so important. If you don’t pay it, the card company will take your deposit. However, you’ll also lose access to the card and the opportunity to show that you’re able to spend responsibly.

It’s important that you use a secured card that reports to at least one, if not all, of the three major credit bureaus, Equifax, TransUnion, and Experian. If not, you basically just have a debit card. Debit cards do not report to credit bureaus, so while they may be a fine example of how you can manage money, no one will see your hard work! As your secured card issuer reports your timely payments, your credit history will reflect it and your credit score should go up. This will take some time, however, so you must be patient and keep at it.

One good habit to practice is to take a regular expense you’re accustomed to paying and start using the card for that. It could be an auto pay on a bill you have for your streaming subscription, one grocery shop each month, or a recurring item like a prescription. What you don’t want to do is go on a spending spree with money you don’t have in your bank account already to back it up.

Another great way to rebuild credit is through a bad credit auto loan. If you’re ready for a new car but your credit is keeping you from getting approved, CreditYes can help with our bad credit auto loan program! We can match you with a dealership in your area that will be with you ever step of the way. Our service is fast and free. Fill out our secure online application and get behind the wheel of your next car today!