First Time Buyers: Credit Tip of the Week
Secured Credit Cards
The use of a secured credit card can and will build your credit over time, it is not an overnight fix to your past credit woes. What is a secured credit card: “a credit card that is issued to a consumer that is tied to their savings account? The amount in the savings account is used to determine the amount of credit available for a person to use. These are often easier to obtain than a traditional credit card”.
How can it help you: you'll have to make all of your monthly payments on time? Think of it as rebuilding the bank's trust in you. After a while, your available credit limit will go up. Then your credit history will reflect a history of timely payments as well as more available credit, both of which will help rebuild your credit score.
Pay close attention to the fees that each company charge, some can be outrageous. You want to steer clear of cards that require a setup fee, account activation fee, annual membership fee, and monthly maintenance fee. With a $200 credit line, you'd soon be over your limit from fees alone.
The best use of a secured credit card would be to never carry a balance on it. Make a few small purchases each month, and then pay them off in full. That way, your credit score will reflect that you've made your payments on time, and you'll pave the way for a better tomorrow.
Secured credit cards traps to avoid, make sure the secured card you choose to help you rebuild your credit: “Reports the credit card limit you have (even if it's only $200)”. Very important to find out that your new secured card does not report that the card is a secured card.
In closing do not look at secured credit cards as a bad thing; they are very useful tools for rebuilding your credit score after tough financial times. Secured credit cards are available to everyone, regardless of how far their credit score has fallen.
To find out more about how My First Michigan home can assist you in your new home purchase, or to find out more about secured credit cards can help build your credit score to an accept level please contact:
Christopher Shaw
My First Michigan Home
16250 Northland Drive Ste 242
Southfield, MI 48075
248-569-1486
www.myfirstmichiganhome.com
Christopher Shaw is a seasoned Real Estate Investor, with over 12 years of experience and has a passion for working with First Time Home Buyers, Mr Shaw has an ambitious goal of helping 1000 new First Time Buyers become home owners of the next 36 months. In addition to the 1000 new home owners he expects to create over the next 36 months wants to leverage each transaction to adopt up to 1000 families through Volunteers of America's Adopt a family Program. www.Myfirstmichiganhome.com