Getting a credit card to help rebuild your credit history is a very wise decision. A credit card can help you create a positive payment history.

This is how you will build positive credit to your damaged score. Unfortunately because of your low score you will have to pay higher interest rates.

It is very important to remove negative items on your credit, while improving your score. You should know that once a negative item ages four years then it has much less impact on your score.

With your card you are going to have to pay an annual fee and around 19% APR. This is called a sub prime credit card because it is designed for individuals with a damaged credit history.

On your card you will be given a credit line of $300. Your other choice is to get a secured credit card.

A secured card works like this; you deposit money into a bank account with the credit card issuer and they give you a credit card with the amount of your deposit as your credit limit. Your card will work just like an unsecured card; you will have monthly due dates and minimums to pay.

Both these types of cards offer instant approval. Before you apply for any card double check and make sure that they report to all three credit bureaus.

A helpful tip to get the most positive credit built from your card is to keep your balance at 10% of your available credit. If your card has a credit limit of $300 it will help if you can keep your balance at around $30.

This shows the credit bureaus that you do have available credit; this is called your available credit to debt ratio. In addition it shows the bureaus that you do use your credit.

There is one other option that we strongly discourage and that is a shopping or catalog card. This is a credit card that is only able to make purchases through a catalog or a website online. We discourage this option because there is often a large down payment required and the card typically only reports to one credit bureau.

You also can apply for a prepaid credit card however these cards typically do not report to a credit agency. However they do work like a bank account and if you are in chexsystems this is a good choice.

In sum we suggest you open a sub prime credit card for your credit score to get the most benefit. This card will help improve your score by creating a positive payment history and improving your ratio of debt to available credit.