How to Improve FICO Score with a Secured Credit Card

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By edwardvance
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Improve FICO Score with a Secured Credit Card

Properly using a secured Visa or Mastercard is one of several useful tools available in rebuilding a less than perfect FICO (credit) score.

Difficulty: Easy

Instructions

Step 1

Use the card.

It is important that you show monthly activity on your secured card. Having the card and never using it will do very little, if anything to improve the credit score.
Step 2

Pay the card off early each month.

Each month, a few days prior to the statement date, call the issuer' s toll free telephone number or use their website, and find out what your balance is.

Send the full balance a few days early. This will show on the credit bureaus that the card has a zero balance at the end of each month, and the issuer will also report that payment was made as expected.
Step 3

Never go over the credit limit.

First of all, you certainly do not want to pay over limit fees. More important, you do not want your credit report line item for this account to look like you are not properly managing the card.
Step 4

Never be late.

Again, the fees. You do not want to pay late fees. But critical to the mission of rebuilding the FICO, you do not want a line item on the bureaus showing that you pay late... this would cause the score to go in the wrong direction.
Step 5

Upon properly using the card for a period of time, you will want to consider converting it from a secured to an unsecured status, which will continue to improve your FICO, and enable you to have your security deposit refunded.

Please refer to my related article on 'Converting a Secured Credit Card to Unsecured'.

A link to the article has been added to the resource area for your convenience.