January 31,2007
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How a Monthly Reporting Card Can Make Your Credit Worse
If you have browsed through a directory of credit cards aimed at those with poor credit, you may have noticed that many tout the fact that they report to at least one of the three major credit bureaus (Experian, Equifax, and/or TransUnion) on a monthly basis. If you are determined to rehabilitate your credit by means of establishing good habits and building a solid history, this is a benefit. Monthly reporting builds your good credit history faster, as positive actions like prompt payment and decent management of your balance(s) show up on your reports much sooner. Lots of lower-risk credit cards may only report a few times a year, meaning that you –the consumer- don't get as rapid a payoff on your hard work.
You may have already figured out, then, that there is a definite downside to monthly reporting. If you slip up – miss a month's payment, or are late too often- this is going to hit your credit reports immediately, further compromising your history and your scores. If you have opened one of these accounts, you must be sure to stay diligent. Take advantage of monthly reporting as a faster track to good credit – not a runaway train bound for worse!