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What credit card will help me improve my credit the most and have highest spending amount for someone with low credit ?

0 votes
I only plan to use it to pay for things when I actually have the money so I can improve my credit. I m about to make a few big purchases though and I think it s a good time to try this. Never had a credit card before. 20 s. My credit is like under 600 because of never using credit and because I have a lot of medical bills in collections. Which I ve been paying off as I can. I would like to get it a little above 700.
Update: I just opened a trans union account and will be disputing some things. There are a few that definitely aren't accurate.
Update 2: What is the difference between secured and non secured credit cards?

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asked Jul 30, 2017 in Business and Finance by Billy

2 Answers

0 votes
All credit cards will affect you the same. Where you get teh card is irrelevant - what matters most are on time payments. However, with medical collections, you are going to find it difficult to get a non-secured card anywhere until you bring those accounts up to date or paid off. Figure it will take you well over a year after paying off the collection accounts to get your score over 700 (at most, you are looking at 5 - 10 point increases monthly). And sorry to say, but if you can get an unsecured card, your limit is likely to be in the $300 - $500 range until you prove you can handle the card wisely (wisely = small purchases keeping under 30% of your limit and paying the balance ff monthly - do not carry a balance month to month).
answered Jul 30, 2017 by Steve D
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You want to straighten out your current situation, before attempting to add more to your debt pile. You will be rejected because of your current fair condition with a current creditor in collections. Once you're out of collections, and that bill is paid, consider same as cash deals - 6 months or 1 year and pay it off 2 months or more early, to avoid paying interest.

Also after you're out of collections, start a savings account, and start depositing $100 each week, while you rebuild your credit. 3 months later try to get a store card, if you get it, make a small purchase and pay off the balance when you get the bill the following month. Keep making those deposits. 6 months after you get the store card, check your score, and apply for a major credit card at your bank, where you've been making those deposits for the past 9-12 months.

If they grant you the account, buy something small, and pay the balance the next month, when the bill arrives (don't wait for the due date). The following month, buy something on the store card, and repeat the payment process, and keep making those deposits. 6 months later, buy something on your major credit card, and pay off the balance again, as before.

At the end of two years, check your credit score - it should be above 700 by now. If it is above 720, you might consider buying a used car, or making a major secured purchase, under 10,000 with a loan for 36 months, use the cash you've been depositing for the payments, but keep making the $100 per week deposits as you pay off the loan. At the end of the loan, you'll have excellent credit and the blemish will be almost history from your past payment problems, in another 2 years. You'll also have a nice nest egg, and have learned how to save, use credit and how to live within your means.
answered Jul 30, 2017 by Stan
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