Source: ezinearticles.com
If you've survived the struggles, searscard.com, of past financial problems, getting new, searscard.com, charge cards may be the furthest thing from your mind. Operating on a cash basis may seem like a sound financial strategy to prevent a repeat of past problems. However, our society makes it virtually, searscard.com, impossible to get by without some form of credit.
Some of you have succeeded in getting credit cards for bad credit to rebuild your score. With the taste of newfound charge privileges, it can be easy to apply for as many cards as you can get. More is better, right? Not so fast. Having too many cards can lead you down the same problems as before and drop your FICO score.
Too Many Cards Can Hurt Your Score
Keeping too may open secured cards can cause potential lenders to turn you down. Creditors shy away from applicants who have the potential to get themselves in over their head with debt. If you experience too many denials, your report will show many recent inquiries which alerts lenders that you're desperate.
Keep The Right Combination
A better, searscard.com, strategy would be to have two credit cards for bad credit, searscard.com, . If you need one for business purposes, a third card would be justifiable. A nice combination that would help your score would be one or two secured, searscard.com, cards, a gasoline card, and a department store card, searscard.com, . Having a varied, searscard.com, portfolio of cards convinces a bank to believe you have the necessary financial skills to handle different types of credit. For maximum effect on your score, keep your balances at or below 30-35% of your card's limit.
Eliminate, searscard.com, Unnecessary Cards
If you need to, searscard.com, eliminate unnecessary cards from your list, start by reviewing the terms and conditions of each secured card. You want to keep two with the best APR and lowest fee schedule. Contact the card companies you don't want and request they close your account. Be sure they report it to the bureaus as "closed by, searscard.com, customer request". If you don't, it'll appear that the creditor closed your account because you were a poor credit risk. This will definitely hurt your score.
Once your account is closed, your charge privileges, searscard.com, will be revoked, and you'll receive monthly statements until your account is paid off.
Trouble Deciding?
If you're having difficulty deciding which cards for bad credit to eliminate, close those accounts with the highest balances or ones you've already defaulted on. Don't close accounts with low balances as it, searscard.com, may hurt your score.
With today's unpredictable financial climate, banks are asserting their, searscard.com, rights to close unused accounts or those with high balances. If you sense you may be heading into future financial problems, reduce, searscard.com, the negative impact on your score by taking the initiative to close your accounts voluntarily before the bank does.
Do you want to enjoy the freedom of credit again? Find Bobby's reviews of the hottest credit cards for bad credit at Bad Credit Card Tips web blog.
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