Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Credit Cards
Profile Image

Question By
JLC9653

0 Contributions
0 People Helped
Is a credit card damaging or helpful?
So let me get this straight...you apply for a credit card to help build your credit, but every purchase you make drops your credit rating, even after paying the amount off??? I'm a little confused.

My credit rating is TERRIBLE and I am busting my *** to build it back up. I've been wanting to get a cc to help build my credit, but I don't want to be penilized. If making purchases on a cc drops your rating, then how is getting a cc helpful?? Someone help me out here please...

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
19 Contributions
373 People Helped

Use it the right way and it will help!

Making charges on your credit card does NOT drop your rating.  On the contrary, having and using credit responsibly is what establishes and builds your credit rating.   However, you've got to use it the right way and with the right formula.  

If you:  use it monthly, only charge 10-20% of your total credit line, pay off the entire balance monthly and on time before due date (no late payments), not only will you NOT be penalized but you will see your credit rating start to improve.  Note:  if you're maxing it out every month then that will drop your score...

Some strong factors that impact your score are length of open trade line, length of positive payment history, and your credit utilization ratio aka what percentage of your available credit you're using.  If you do the 3 things in the paragraph above, you will be positively impacting these three factors of your overall credit profile and you will be improving your credit and your scores will rise.

Credit cards are necessary in today's economic market.  It is the way that they are used that determines whether they are a detriment or a help to your scores and consumer profile.

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.