using credit cards to fix your credit?

[donna]

After falling under some credit problems, a friend suggested getting a few credit cards to improve the situation. Will having more credit cards fix help fix your credit? How is this possible considering that most people who have credit problems can blame at least some of it on credit cards?

[Japhet11]

Hi Donna,

It is possible to use new credit cards to help boost your score. Now, that doesn't mean that opening a bunch of new cards and maxing them all out is going to help any credit problems. New credit only helps if you are able to show lenders that you are using it responsibly. While any older, derogatory credit will still show up on your report, this new credit, if used right will demonstrate that you have matured since then and understand how you should be handling credit.

The other benefit of new credit is that it will help what is known as your debt-to-limit ratio. This is basically the amount of credit that you are using compared to the total of all of your credit card limits. By adding more available credit you are lowering your debt-to-limit ratio, which is a good thing. This also assumes that you don't go out and immediately run up a high balance. Ideally, you want to try and stay near 20% of your credit limits.

If you have any other questions, or need any credit repair help, please ask away. Someone will be sure to answer any questions you may have. Or for a free consultation, please visit MyCreditGroup.com.