How to Rebuild Your Credit Using Your 2009 Tax Returns

Rebuilding your credit is not that difficult. It takes time, patience, the right resources, and a good start. As a victim of the bad economy crisis, I too had to start over, and my future is looking brighter than ever. The beginning steps I followed in the rebuilding process is very simple and it works! I’ve been successful and it has been a rewarding experience. Use your 2009 tax return and follow these steps to start rebuilding your credit.

File your 2009 income tax return. Use the money you get back to get a secured prepaid credit card.

Search for a good secured credit card. There are a lot of companies out there. Google, “secured credit cards”, “secured prepaid credit cards”, “secured visa credit cards“, or “secured MasterCard credit cards. You should see Bank of America, Orchard Bank, Capitol Bank, just to name a few. I personally choose First Premier Bank. However, choose the one that works for you and your family, but whatever you choose make sure it will REBUILD YOUR CREDIT!

When you apply for the card of choice, you will be approved and it takes about 2 weeks to get the card in the mail. Whatever the fee is for that card company pay it right away. For example, First Premier Bank gave me a $300.00 limit, and I had a $179.00 fee to pay, and I paid it immediately with online bill pay at my bank.

Now after you pay the fee, not before, then you start using your card. Now here is the trick to really rebuilding your credit. DO NOT use the card unless you have the money to pay it off the next day! Why you ask? It’s simple, if I have $70.00 in my bank account and I need gas, I use my prepaid card and when I get home I go online and send the gas money from my bank account to the card company. All you did was use the money you already have AND you don’t have to worry about the interest rate, or finance charge. If you pay your card balance off within 2 weeks, you don’t have to pay the interest. Even though you have 30 days to pay a minimum balance of $15.00 to $25.00, you don’t want to ever do that, because they will tack on the interest. Also, never charge over 50% of your credit limit, example, if your credit limit is $300 never charge over $150.00, NEVER!

The above step is the most important step and it will get you on your way to your second credit card. Do the same with that card and when you check your credit report watch and see your score go up. This process takes about 6 months, but it is worth it. You can then start using those credit cards to pay on hospital bills, student loans, or whatever you are behind in. But remember, don’t use the card unless you know you will have the money within 2 weeks to pay off the balance. Paying off the balance will save you the finance charge, you just pay dollar for dollar, and that is a win, win, win, for YOU!