For optimal credit repair results you need to understand the power of revolving debt. Your credit scores are the product of both the positive and the negative data on your credit report. While there are many factors that can drive down your credit scores, nothing can improve them like properly managed credit cards.
Not all Credit Cards are the Same
Let’s start with a little credit repair caveat, not all revolving debt is created equal. If you want to build your credit and optimize your credit scores you need to use mainstream revolving debt, like MasterCard and Visa. Don’t make the mistake of trying to build your credit with store cards. The FICO scoring model has a built-in bias against store cards which will weigh on your credit repair efforts. Put your energy where it will produce the best results.
Stick With the Basics
Although MasterCard, Visa, American Express, and Discover are all weighted equally by the FICO scoring model we ask our credit repair customers to focus on MasterCard and Visa. There is no mystery, we don’t recommend American Express and Discover simply because they are harder to obtain for people with impaired credit, and even if you do get them, they are not universally accepted.
Your Balances and Your Scores
Managing your credit cards for credit score improvement is simple. The FICO scoring model recognizes certain card usage breakpoints, 20, 40, 60, 80, and 100 percent; the lower your balance, the higher your score. If you have the means you should keep your balances under 20 percent of the available limit. Depending on the overall content of your credit report your revolving balances can swing your credit scores by over 100 points making credit card management an indispensible part of your credit repair effort.