If you have ever been through a bankruptcy, you know that it is difficult to build your credit score back up to a high level or even obtain a credit card. Bankruptcies can be listed on your credit report for as long as 10 years. This is a long time to wait if you’d like to apply for credit.
You are probably like most individuals who prefer having a small cushion of credit available to pay for financial emergencies when they occur. Fortunately, the Indigo Platinum MasterCard was created for individuals like you who have made some financial mistakes in the past. The Indigo credit card has guidelines that may allow you to obtain a line of credit, even after going through a bankruptcy.
Your Credit History Is So Important
Your credit history is a crucial factor when banks or other lenders are considering giving you credit. It’s difficult to obtain a credit card or receive a loan for a small piece of equipment, automobile or other necessity when you have a history of bad credit. When these lenders check any of your credit reports that are provided by TransUnion, Experian or Equifax, your bankruptcy is going to pull up a red flag and probably eliminate you from getting that line of credit or credit card that you need.
Your credit score is also going to be at a lower level if you have any type of bad credit. The most commonly used number comes from your FICO score. While the exact formula to calculate your credit score is not shared publicly, there are some broad factors that go into making up your score. These major areas include the following:
- Payment History 35 percent – This factor includes your ability to pay your loans on time.
- Amounts Owed 30 percent – Your credit utilization should be kept under 30 percent. Make small purchases.
- Credit History 15 percent – Keep your accounts open to show a long period of credit history.
- Types Of Credit Used 10 percent – Utilize different types of loans over a long period of time.
- New Credit 10 percent – Wait a period of time before opening new lines of credit.
Consider all of these factors whenever you are using or applying for credit. They all make a big difference in factoring your credit score.
Rebuilding Your Credit
One of the best ways to build your credit is by applying for and receiving a credit card. If you’ve already got a bankruptcy listed on your credit report, you’ll need to apply to a financial institution that is more forgiving than others when considering your past credit history. Genesis Financial Solutions is that type of company. Their Indigo credit card has guidelines that may allow you to obtain a line of credit and start rebuilding your creditworthiness. You can easily pre-qualify for the Indigo Platinum MasterCard to see if you meet their eligibility requirements. This won’t dock any points off for your credit score and is a great way to see if you are able to get a credit card without actually applying.
Using Your Card
Once you’ve applied and been accepted for the Indigo Platinum MasterCard, you’ll want to manage your credit in a wise manner by following those factors that are listed above. Only make small purchases with your new credit card and keep your balance under the 30 percent limit of your total credit line. If you have $1000 available, you should only charge up to $300. This will show that you are not desperate to use your line of credit and can easily pay your bill.
Pay On Time
You have already learned that paying your bill on time is a factor that makes up 35 percent of your credit score. It’s imperative that you pay the minimum amount on your credit card bill every month. It’s even better if you can pay off your total bill each month. This allows you to avoid paying any interest. It’s much better getting in the habit of making small purchases and paying off the total balance each month.
You don’t want your outstanding credit to snowball and become a huge burden. Once you’ve obtained your credit card and established your credit-worthiness by utilizing small amounts of credit and paying your bill on time, just repeat the process month after month. Slowly, your credit score will increase and you will build your credit back up to a level that shows you have a high ability to pay back your debts.
Open Just a Few Accounts
After opening up your new credit card account, slowly use it for a number of months. After doing so, it’s better to ask for a higher limit of credit than obtaining another new credit card. Often, if you have been diligent about paying on time, the bank that services your card will raise your credit limit. If you do decide to open another account with another type of credit, do this in a slow manner after you have built up your creditworthiness. This shows that you know how to manage your credit and use it in a prudent manner.