As you may know, one of the most helpful ways to improve your credit, before you have credit, is to take out secured credit cards. As soon as you start making on-time payments, your credit will start to improve. However, it is possible to get denied for a secured credit card. It doesn’t happen very often, but it’s definitely possible.

Usually when this happens, it’s because of either a bankruptcy or a foreclosure. There are a lot of banks that will let anyone get a secured card, but some won’t. Bank of America is well-known for not allowing people to get secured cards if they have been through a bankruptcy. If you haven’t gone through a financial situation such as these, you probably won’t get denied unless you have extremely beat up credit.

If You Find Yourself In This Position

If you can’t get a secured card, you should consider using prepaid credit cards. You will want to make sure that you get one that reports to credit bureaus and as long as you do, you can start building credit that way. It’s likely that you’ll be able to skip using secured cards – generally speaking these card companies will allow you to get an unsecured card with a low credit limit as soon as they figure out that you’ve been making on-time payments.

Using a prepaid credit card usually costs about $10 per month, on top of what you spend – well worth it for the chance to rebuild your credit. This process can of course take a few months. When I did this with my secured cards, it took about six before I figured out that I could get an unsecured card. I, of course, might have been able to do it sooner.

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