Tired of Secured Credit Cards? Take Your Credit To the Next Level
Secured credit cards are a great way to rebuild credit for those who want to avoid the higher fees and interest rates that often accompany unsecured credit cards for bad credit. But what's the next step on the path to excellent credit after you've managed to pull your FICO scores out of the dump and into the average credit range? You really shouldn't use a secured credit card for one day longer than you absolutely must. Unfortunately, many people tend to hang onto them for way too long because they're worried about using unsecured credit again. This is a mistake and will only cost you more time and money as you work to get your credit scores back where you want them.
Credit Cards for Fair Credit
As soon as your credit scores finally begin to climb above 650 once again, conduct a search online and begin comparing what options you have for fair credit credit cards. You might also want to speak with the credit issuer of your secured card to find out if they would be willing to upgrade you to an unsecured credit card for average credit. This is the easiest route to take in many cases. However, if they won't upgrade your card, don't worry— there are plenty of other good options out there to consider. While a lot of the credit cards for fair credit will still have annual fees, many will also offer rewards programs which you should be excited to finally use to your advantage. The Capital One Cash Rewards credit card is great example of a fair credit credit card that offers 1 percent cash back on all purchases with a low annual fee of just $39. In addition, you'll receive a 50% bonus on the cash back you've earned each year, which really makes this a 1.5% cash back credit card. That's not bad for a fair credit credit card! Another perk that comes with all Capital One cards is the absence of foreign exchange fees, so you can feel free to use the card while traveling out of the country without worrying about getting hit with an additional 3% currency-conversion fee. As with any unsecured credit card, you'll want to treat fair credit credit cards as if they were a secured credit card. What do I mean by that? I mean only buy what you already have the cash to pay for in your bank account, continue to keep your credit utilization ratio low (10 percent or less), and always pay your balances in full and on time. All the principles of attaining good credit remain the same, and if you can abide by them, your FICO scores will continue to improve and you should soon find yourself moving away from "fair credit" and into the coveted excellent credit range.