How to Use PrePaid Cards for Credit Repair

By Johnathan T. Bakers

It’s getting tougher and tougher to buy anything without plastic these days. Since some people have a bit of trouble, and need credit repair, they turn to their only alternative, which is the pre-paid card. These work just like credit cards for the outside world.

Behind the scenes though things work a little bit differently. With the prepaid card, you’re basically practicing good debt management. The reason is that you are funding the account, and putting money into it, and then you can use it just like a normal credit card.

There is a small fee that you’ll have to pay when you open the account which is the one little downfall, however through good credit counseling, and persistent payments you can very quickly repair your credit.

Repairing credit isn’t always easy, but good common sense is basically what it takes. Budgeting, watching your spending habits, all of the little things that have gotten you into trouble in the first place.

Having bad credit can make your life miserable to say the least. You need to repair it if it’s bad, but first you’ll need to look at your credit reports to see exactly what needs to be fixed. Sometimes the charges that show aren’t even yours, and therefore mistakes can be fixed.

Many people are afraid to find out exactly what they owe, but finding out is the first step in the right direction. You can get your credit report from any of three major credit bureaus. These include Trans Union, Equifax, and Expedia. Don’t take the advice from those people who tell you to get your reports for free by applying for a loan. This is simply bad credit counseling on their part, and it’s important that you know that each time you apply for a loan it gives you points on your credit score. Not good points either.

It’s best to part with $60 bucks now, and save you much more down the road. It’s important to consider your long-term debt management, and spending $20 for each report is more of an investment for your future than an expense.

So your choice for the prepaid card will show itself to be a wise one. You’ll be able to use it as a credit card, getting all of the benefits of having a regular unsecured card, and nobody will ever know that while you’re using your card, and making your monthly payments on time, you’ll also be rebuilding your credit.

There are some scams when it comes to applying for these cards, such as those that promise to restore your credit, yet charge you up to $300 dollars upfront, and then never send you the card.

Johnathan Bakers's short articles are published on countless online sites related to money management and assets. Working on his detailed publications such as http://www.debtania.com/managingcreditcard.html , the author expressed his experience on information dealing with managing credit card debt.