How to use a secured credit card to raise my score

[Anonymous]

I have perused the information on these boards and looked elsewhere on the internet, but I am still a little unsure on this.  If anyone could help me, I would greatly appreciate it.    I am in the process of trying to clean up my very ugly credit.  I have already sent out a few PDFs and GW letters and have had some success.  I think my next step may be to get a secured credit card to start rebuilding my score.   I'm just a little confused about what would be the best way to use it to help my score. 

First off, I can't afford to deposit much onto the card.  Probably only about $200 at this time.   With this tiny credit limit, would it help me at all?  Is the idea to use the card each month and then pay off the entire balance each month?  Or do I use it and pay off all but a little?     Thanks in advance for any help. 

[joeydtx]

A majority of secured go for 250-300 minimum but there are a few for 200.  Any amount though will help, if you PIF and make sure you do not be late ever you will see some positive signs as it ages.  I personally would recommend two, but whatever the case try and keep the utilization down to 10% (200 = 20 bucks) or if you can successfully time when the card issurer reports to PIF so that the TL equals this.  Hopefully my two bits helps, and if you get one try local CU first before a big issurer because they tend to take better care of their members.  Good luck!

[BungalowMo]

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@joeydtx wrote:
A majority of secured go for 250-300 minimum but there are a few for 200.  Any amount though will help, if you PIF and make sure you do not be late ever you will see some positive signs as it ages.  I personally would recommend two, but whatever the case try and keep the utilization down to 10% (200 = 20 bucks) or if you can successfully time when the card issurer reports to PIF so that the TL equals this.  Hopefully my two bits helps, and if you get one try local CU first before a big issurer because they tend to take better care of their members.  Good luck!

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That's some good advice.  From everything I've read, some banks that issue secured cards may never change the acct over to a regular cc. Leaving you with no option than to either eventually close it, or keep adding $$ to the card to have it post with a higher limit. 

I'd do my homework on this one & certainly check into a local CU.  Talk to their credit department & ask what your best path would be to eventually open a regular cc with them, even if you start with secured & they eventually swap you over to unsecured.

[newstart2010]

Keep searching, check out some CUs, and find a card that will allow you to do 200 or 250.  If you need to wait till you save up the 50 or 100 to get to 300 do that.  it will open up your options.

At this time, future is not the focus.  You need something that you can just get your ball rolling.  So get a small secured card, and then use it each month for a bill or lunch or something.  Then pay it off immediately.  This will always show use, and always show a paid in full balance.  Does it matter that your limit is only 300?  Not right now.  Not for the score.  So do what you can and make it work.  

[Anonymous]

Call your local independent banks too.  We use Premier Bank in Tallahassee.  This bank doesn't operate outside of the tri county area, and their secured C.Cards start with balances as low as $100.

[Anonymous]

Thank you for the help everyone.  I found a card that I can open for $200 that will report to all 3 bureaus.   I will take your advice and charge something small each month and pay it off.   I don't need to keep a small balance on it?

[newstart2010]

No, and you can use the whole limit if you want, but be sure to pay it off each month in full.  use it for a bill you would normally pay each month, and then turn around and pay it off with the money for the bill.