Rebuild from a Fair Credit Score (580,669)
Apply for a store credit card
Chances are you’ve been asked at least once to open a store credit card when paying. While store credit cards typically come with very high interest rates and low credit limits, they are great tools for people looking for a way to establish or rebuild a credit score. credit, as the credit requirements for approval are often much less stringent than a standard credit card that can be used anywhere.
Some popular store cards issued by retailers include Target, Walmart, Amazon, Kohl’s, Old Navy and more. Many have rewards or discount programs that encourage you to spend at the store each time you visit, but if you can exercise self-control and just use the card for a small purchase each month and pay the balance when the statement is owed, you will avoid building up a large balance which can add up very quickly as high interest charges are added.
Typically, store cards fall under all three credit bureaus, but read the fine print to make sure which one you choose to apply for falls under all three.
To avoid spending more than you should with the card, you can unsubscribe from emails about discounts, sales or offers and not even carry it around in your wallet every day. Learn more about the best ways to manage a store card here.
Like secured cards, store cards often come with very low spending limits at first, so remember to keep your spending below 30% of your credit limit each month, which will improve your credit score. . And if you get rejected for a store card, it’s probably best to revisit secured cards as your best tool for rebuilding your credit instead.
With proper credit behavior, you can see your score increase and then you might be able to qualify for a store card.
Check if you are prequalified before officially applying
If your credit score is in the high 600 range, you may want to consider checking to see if you are prequalified for all cards.
Prequalifying can help minimize your risk of rejection when applying because the card issuer is simply doing a soft pull on your credit rather than a hard pull. A light pull on your credit history does not hurt your credit score, while a heavy pull (which is done when you formally apply) can lower your credit score by 5-10 points each time (although the impact of this strong traction will diminish after one year).
Just be aware that even if you’re prequalified for a card, it doesn’t guarantee approval, as the issuer will dig deeper into your credit profile when you formally apply.
Again, the goal is to use less than 30% of your total available credit. Pay your bills on time and in full. And keep adding this positive information to your credit report until your credit score hits the 700+ mark.
Another option to consider is to become a secondary or authorized user on someone else’s credit card. For example, you can ask a family member who has great credit and always pays their bills on time to add you to one of their credit cards as an authorized user. Then the account and payment history associated with that card will be reported to the credit bureaus under your name, giving you an instant boost.
Just be aware that if you choose to use the authorized user card (you don’t have to use the card for the account to report to your credit report), the primary account holder is ultimately responsible for payment. To avoid damaging a relationship, do not use the Authorized User Card unless you and the Primary Account Holder mutually agree on how any charges you make with the Card will be paid.
Once your credit score has improved to the point where you can qualify for a card on your own, you can request deletion as an authorized user after successfully getting your own card approved.