This really works.   I helped 2 friends raise their credit score over 100 points each, in 18 months from approximately 610 to 710.   If you are trying to borrow money, you know how important a good credit score is.     If you are buying a house, a low credit score can cost you $100,000 or more in high interest rates over a 30 yrs mortgage.     A higher interest rate on that new car you have your eye on can cost you several thousand dollars in higher finance charges before it is paid off.

The two friends I helped had lost all their credit cards and had none.    Now, a little over 18 months later, they each have great cards with approximately $35,000 total credit limit.    They get offers for more cards, but they throw them away unless they are offered a free vacation or other worthwhile bonus, such as 20,000 airline miles, just for signing up.   It is funny, 'cause they have become downright snobby about it, considering that just 18 months ago they couldn't even get an unsecured decent credit card with a $250 credit limit.

Very few people know about this trick, but I found out about it a few years ago and had a few friends experiment with it to fine tune it.

If you have bad credit and no credit cards, get yourself 4 or 5 SECURED credit cards (Mastercard or Visa only).    Even if you have to pay annual fees, it is worth it!   Look at the BIG picture, all the money you will save later on.    You may even find a bank that will give you a credit card with NO security deposit, but they charge a lot of upfront fees.  I think you are better off with a lower fee card with a security deposit, 'cause at least then when you are done with the card, you get your deposit back and sometimes, even with interest!

If your local banks do not offer secured cards, check out these banks:

-Capital One
-First Premier Bank
-Cross Country Bank
-Orchard Bank
-New Millenium Bank


Get the SMALLEST credit line you can, which will mean the smallest security deposit.   Many banks will let you open a secured credit card with as little as $100 deposit.
Then then give you a Mastercard or Visa with a $100 credit line.

Then go and buy $1 worth of gasoline EACH month from a gas station on EACH card.

When you get your bill, pay it off IN FULL.   This looks very good on your credit report.  Whether you spend $1 per month or $100 per month, it is all the same for the purpose of reporting to the credit bureau, BUT DO NOT get too close to your credit limit, or that will hurt your score.  If you get to about 75% of more of your credit limit, I have been told that may hurt your score.  Others say 90%, but to be safe, keep your purchase VERY LOW.

If you only buy $1 worth of gas each month, it will be easy to pay off.

THIS REALLY works and after a year or so, you will find you can get credit cards with MUCH better offers, in fact THEY WILL SOLICIT you.   Wait till you get cards that have better terms than your secured cards and replace them one by one.

While there is something to be said for longevity of a card relationship, check your score after a year, then if you are where you want to be and have gotten your car loan or mortgage, then replace the cards with the better offers you are getting.    If you have not yet applied for your loan, then go ahead and keep them a little longer and gradually replace them, one by one, over the next year or so.    My two friends who I have helped have been able to replace their secured cards with tiny credit lines with unsecured GOLD and PLATINUM level cards with very high credit limits.

The reason this works and is perfectly legal is that the secured cards don't show up as secured on the credit reports and you get just as much credit for handing them responsibly as you would with unsecured credit cards.     You are showing that you can handle credit responsibly.

OF COURSE, while you have these secured cards, BE SURE to pay all your bills on time.  That is very important, otherwise your credit score will not climb. 

Note, if you have other credit cards still open, you don't need to go out and get new secured cards.

Just make that $1 gas purchase on 4 to 5 cards, EVERY MONTH.  Do it the same time each month, so you don't miss any cycles.     It used to take me about 10 minutes and I would always go to SELF-SERVICE stations (you can buy all your four or five $1 gas purchases at one station).  If you go to a full service station and ask for $1 worth of gasoline on your credit card, they may tell you where to go and it won't be to the next available pump.  :-)

REMEMBER, once you eventually trade up to the high credit limit cards, pay your bills off every month in full.   Don't get caught in the credit trap.   Otherwise your credit score will come tumbling down and all your hard work will be for nothing.

Hope this is helpful.

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