What are credit-builder cards?
If your credit score is low, you’ll probably find it harder to borrow money or take out a mortgage. This need not be a permanent problem, however. No matter how much difficulty you’ve had with money in the past, there are always ways to improve your score. A credit-builder credit card is one of the best ways to boost your credit score.
It works like this: the card issuer gives you a low credit limit, which you then use to make small purchases. If you pay the balance off at the end of each month, you will start to show that you can be a responsible borrower, and your credit score should rise over a period of four to six months.
It’s very important to make your repayments in full and on time, however. The goal is to prove that you can pay back what you borrow.
Pre-paid credit-builder cards are another great way to improve your credit score.