Credit Cards for Rebuilding Credit: TOP 3

January 5, 2013 No Comments »
Credit Cards for Rebuilding Credit: TOP 3

Many people struggled with their credit in 2012. If you’re one of them, try not to get too discouraged as a credit come back isn’t as difficult as some make it seem – especially if you have a plan!

Regardless of how your credit rating fell, a swift road to recovery is likely achievable – and it starts with an unsecured credit card.

The number one problem with rebuilding your credit is that no one will lend to you. Be it in the form of a new credit card, a personal loan or even a mortgage. It’s ironic in a way – the only way to rebuild credit is to prove you can repay money, yet no one will loan you that money because your credit is damaged.

 

Update July 2013 - See today’s top 10 secured credit cards on the market here.

 

This is where secured credit cards fill the void and allow you to start to rebuild your score. Unlike traditional credit cards that wont accept you unless you have at the very least average credit, secured credit cards will accept anyone.

Once you’re approved for the secured card you’ll need to put down a deposit. This deposit amount will then determine your spending limit. This is contrary to traditional credit cards where they will give you the spending limit with no deposit down. You’re then encouraged to spend with the card, but BE SURE to pay off the balance in full each month. So know your spending limits and keep things under control.

Be sure your secured card reports to ALL 3 of the major credit agencies. The best feature of a secured credit card (and the single reason they enable you to re-establish your credit) is that they report to the major credit bureaus. The cards we’ve listed below report to all 3 every month. You should accept nothing less as this will give you the swiftest path to recovery. Some banks and credit unions will try and get a way with reporting more sparingly because it actually costs the banks money to file these reports, so be sure to keep an eye on them.

Top 3 Credit Cards for Rebuilding Credit in 2013:

 

Update July 2013See today’s top 10 secured credit cards on the market here.

 

The following list may be outdated (use the link above for today’s top 10 offers).

The following offers shown below are the top credit cards for rebuilding credit. They report to the three major credit card bureaus monthly and have extremely broad acceptance.


  capone_secured1) The Capital One® Secured Mastercard® is currently the best offer for rebuilding credit. See features below.

  • • Build credit with responsible use with no processing or application fees• Regular reporting to the 3 major credit bureaus

    • Monitor credit with access to a credit score and other tools

    • Your security deposit can get you a line up to $3,000

    • You may qualify for a credit line increase based on your payment history and creditworthiness

    • Use it like any MasterCard credit card, accepted at millions of locations worldwide

 

6d36db95-1cdf-449e-854f-eab3131070612)  First Progress Platinum Elite MasterCard® Secured Credit Card

  • Nationwide Program – though not yet available in NY, IA, AR, or WI
  • Credit Line Secured by Your Fully-Refundable Deposit of $300 — $2,000 Submitted with Application
  • Just Pay Off Your Balance and Get Your Deposit Back at Any Time
  • Monthly Reporting to all 3 Major Credit Bureaus to Establish Credit History
  • Good for Car Rental, Hotels; Anywhere Credit Cards are Accepted!
  • No Credit History or Minimum Credit Score Required for Approval
  • 24/7 Access to Your Account Online

3) Household Bank Rewards MasterCards – Offer no longer available.

This was our third favorite credit card for rebuilding or establishing credit simply because it offers substantial rewards for those with less than ideal credit. Too many times this year we’ve seen cards issue their “bad credit” credit card with the same boring features. In fact, many simply function like a lack luster debit card, however, the Household Bank Rewards cards actually treated you like a premium credit card holder. You used to be able to nab a whopping 2% cash back on purchases PLUS a 0% introductory APR for 9 months. There was automatic credit reporting the the 3 major credit bureaus and 100% protection for unauthorized use.

[Related: 7 surprising reasons your credit score isn't higher.]

Latest Credit Card Debt Data:

The Federal Reserve has reported that the rate of outstanding credit card debt has fallen for 19 of the last 21 months. Our nation’s cumulative consumer credit card debt (according the the FED Reserve) was sitting at $2.41 trillion as of October 2010. This is down from $2.57 trillion in January 2009 but still drastically above the pre-recession levels of $961.84 billion in 2007.

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