Is Old Bank Card Still Valid After Getting New Card Building Credit With Credit Cards

You are searching about Is Old Bank Card Still Valid After Getting New Card, today we will share with you article about Is Old Bank Card Still Valid After Getting New Card was compiled and edited by our team from many sources on the internet. Hope this article on the topic Is Old Bank Card Still Valid After Getting New Card is useful to you.

Building Credit With Credit Cards

When people find themselves with bad credit the most common refrain they hear from friends, family and idiots on TV is “… first thing: cut up those credit cards!” That couldn’t be more wrong. Credit repair, like life, is often counterintuitive, and the role of credit cards in rehabilitating your credit scores couldn’t be more so. Let me walk you through a worst case scenario.

For our scenario lets assume you have horrible credit scores, sub- 500, with lots of write-offs and old, bad debt. The last thing you want to do is cancel any existing credit lines for two reasons. First, if you close them they will continue to report as a debt each month but they will not show any available credit and you need as much available credit showing as possible. Even a store credit with $289 owed with a $300 ceiling is better than $289 owed on a closed account. The second reason we don’t want to close any credit lines that are still viable is that with credit this bad you won’t be able to open any new accounts for a while so you’re best off working with what you have. Paying down that $289 debt to $149 will make a tremendous impact on your credit scores, probably pushing you above the “drop-dead” 500 credit score.

In a real worst case scenario you don’t even have one account active and clean enough to work with, thats when credit cards become a necessity if you want to rehab your credit within your lifetime. There are cards that will approve anyone with a valid social security number but the costs are high. A typical “worst case” card will offer guaranteed approval but your credit line will only be $300 and the fees to get the card will be upwards of $240, which is applied directly to the card. Thus you get a legitimate credit card that will report your good payment monthly to all three major credit bureaus but you will start out with a fat balance right away. The key is to now pay that down right away so that you are showing an available balance greater than half the maximum credit line of the card, in this case less than $149 owed on a card with a $300 limit. This may seem like a very predatory lending practise and it is, however you are not signing up for credit you are “buying” a credit booster. Simply paying this credit card balance off with on time payments will greatly improve credit scores within 3-6 months.

After you’ve had the “worst case scenario” card for 6 months, assuming you haven’t been late or defaulted on any new debts, you will no longer be a “worst case scenario”. You can now apply for a better card that will actually start with some credit. You usually need a job and one line of credit in good standing for 6 months to get a “step-up” card, that is where the “worst case scenario” card comes in. If you can transfer the balance from your first card to the new one that’s great but you don’t want to cancel the first one even if it seems silly to pay monthly and annual fees to keep a card you will never use. You will keep all of these cards until you have truly reestablished your good credit. This new card should have reasonable fees but you will still be paying $60 to $100 in set up fees and you will have an interest rate at the very high end. It doesn’t matter the interest rates because you aren’t supposed to use this card anyway, just let it bouy your credit.

After you’ve had both cards reporting good payment for about a year with low balances you will see an amazing improvement in your credit scores. The reason is because the formula the credit bureaus use to determine who deserves credit is based on who already has credit. The more unused credit you have the more credit lenders want to give you. At this point you should start replacing predatory cards with high annual fees with good cards with zero annual fees.

Building credit through “bad credit credit cards” is not the only way to improve your credit but it is one of the most important steps if you are really in a deep hole.

Video about Is Old Bank Card Still Valid After Getting New Card

You can see more content about Is Old Bank Card Still Valid After Getting New Card on our youtube channel: Click Here

Question about Is Old Bank Card Still Valid After Getting New Card

If you have any questions about Is Old Bank Card Still Valid After Getting New Card, please let us know, all your questions or suggestions will help us improve in the following articles!

The article Is Old Bank Card Still Valid After Getting New Card was compiled by me and my team from many sources. If you find the article Is Old Bank Card Still Valid After Getting New Card helpful to you, please support the team Like or Share!

Rate Articles Is Old Bank Card Still Valid After Getting New Card

Rate: 4-5 stars
Ratings: 2201
Views: 98473674

Search keywords Is Old Bank Card Still Valid After Getting New Card

Is Old Bank Card Still Valid After Getting New Card
way Is Old Bank Card Still Valid After Getting New Card
tutorial Is Old Bank Card Still Valid After Getting New Card
Is Old Bank Card Still Valid After Getting New Card free
#Building #Credit #Credit #Cards

Source: https://ezinearticles.com/?Building-Credit-With-Credit-Cards&id=1297285

Related Posts

default-image-feature

Identify And Describe Two Differences Between New And Old Imperialism After Gaddafi, Literature’s New Dawn

You are searching about Identify And Describe Two Differences Between New And Old Imperialism, today we will share with you article about Identify And Describe Two Differences…

default-image-feature

Ideas For Using Old Barn Wood In A New Home Artisan Carved Custom Barn Doors

You are searching about Ideas For Using Old Barn Wood In A New Home, today we will share with you article about Ideas For Using Old Barn…

default-image-feature

I Want To Merge My New Page And Old Page Scrapbooking and Visual Journaling

You are searching about I Want To Merge My New Page And Old Page, today we will share with you article about I Want To Merge My…

default-image-feature

I Want Replace My Old Site With My New Site How Much Should You Pay for a Website?

You are searching about I Want Replace My Old Site With My New Site, today we will share with you article about I Want Replace My Old…

default-image-feature

I Told My New Dom About My Old Dom Erotica Male Chastity and Three Huge Benefits

You are searching about I Told My New Dom About My Old Dom Erotica, today we will share with you article about I Told My New Dom…

default-image-feature

I Received My Old Passport But Not My New One Money Advice For Backpackers – When to Use Cash, Credit Cards and Traveler’s Checks

You are searching about I Received My Old Passport But Not My New One, today we will share with you article about I Received My Old Passport…