The Method of Applying for a merchandise credit and Improve Your Credit

There are a variety of techniques you can use to raise your score. But most take time time you may not

have. A faster way to improve your credit is by using a sub prime merchandise card. We will discuss

more about that in a minute. First, a little background on how your credit score is determined. One of

the numbers that is used to generate your credit score is your debt to credit ratio. This is simply how

much you owe divided by the amount of credit lenders have given you. A high debt to credit ratio means

you will have a worse credit score. For example, if you have $10,000 in unsecured revolving accounts

(the limit of all your credit cards added together, for example) and your outstanding balance is $8,500

your debt to credit ratio is 85 . And that is bad news for your credit score. Lenders would like to see

borrowers with a more reasonable (meaning, lower) ratio. You could pay off a lot of your debt to lower

your ratio, but that probably is not possible. The other way to improve your debt to credit ratio is by

increasing your high credit limit by getting a new credit card with a big, fat limit. Sorry, but that is not

going to be easy to do with your credit score. There is an alternative: a sub prime merchandise credit.

These cards are available to those with poor credit.

Cleaning credit with secured credit cards and sub-prime online merchandise cards can be an alternative

for the credit challenged. Basically, when your FICO score falls below certain levels, it becomes

increasingly difficult to get credit of any kind at a reasonable cost. Obtaining a credit card, if even

possible, begins to resemble pawn-shop and loan-shark interest rates. When you find yourself in a

situation like this, there are steps you can take for credit clean up. Using a secured credit card for a

period of time can help with credit clean up, even if it is for a price. A secured credit card is basically

what the name says, a credit card secured by a cash deposit with the card issuer. For instance, placing

say $400 in a deposit account with a participating bank or lender would entitle you to $400 worth of

credit, or some amount close to that. You may wonder why not just spend the cash instead of leaving

money in the account, and instead of paying the monthly fees and expense. After all, some shopping for

these cards will show that the fees can be quite high. Well, the answer is that this is a price to pay for

cleaning credit as you go. By making your normal purchases with the secured card, and consistently

paying it off at each statement, this information begins to be reported to your credit history. By doing

this over a period of time, all those on time payments begin to drown out the negatives on your reports,

and soon you will see an improvement in your credit score.