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All the information regarding individuals previous credits raised and repayments made are recorded. This compilation of this information is known as credit history. It is an indicator of an individual's credit worthiness. It shows weather one is responsible in ways of paying the credit which he has raised on time or weather he has a tendency leaning towards late payments. The credit history is one of the important factors that credit card agencies and other loan sharks look for prior to sanctioning credit cards or loans. Hence one should try to keep his credit history as tidy as possible.
Bad credit history
Certain individuals might have a habit of late payments. These late payments of credit incur finance charges. Late payments or any deviation from the payment protocol might dent ones credit history and lead to the creation of a bad credit history. A person with a bad credit history should try to pay away his debts as soon as he can and covert his bad credit history to a good one. The failure of which has serious repercussions. It is an uphill task to find an agency that would issue a loan or a credit card to one with a bad credit history.
There are various methods to regain a good credit history
• Try to make payments on or before time.
• One can use the option of balance transfer credit cards
• Change spending habits.
• Reduce the number of credit cards owned
• Analyze your annual credit reports for any errors.
Credit card options for a bad credit history
The two basic types of credit cards available are secured and unsecured credit cards. Unsecured credit cards ore ones which carry no initial deposit. These cards are usually issued to individuals with a clean credit history.
Secured credit cards are ones where an initial payment or a security is required. The initial payment is deposited in a savings account. If an individual fails to pay the balance the bank has the authority to invade his account and withdraw cash. This account is issued to individuals even with bad credit or bankruptcy. A past foreclosure does not qualify for a secured credit card. There are many processions that can be used as security. Certificates of credit, fixed deposits, car, home these are some of the processions that can be offered as security in order to get a secured card sanctioned.
Things you will need to obtain a credit card
• Identification proof
• An indebt knowledge of credit history
• Secured credit cards
Apply for credit cards at small financial institutions as they might stoop to any level in order to secure a customer. If your application is accepted try to make small purchases. Make sure that you clear the balance prior to the stipulated period. Approach your bank or any financial institution and find out the terms and requirements. Try to obtain a secured credit card. Another option to consider is to get a friend or a family member to co sign for a credit card.
