Credit Cards to Rebuild Credit After a Bankruptcy

When you're repairing your bad credit, you need to address each of the categories that contribute to the calculation of your score. Using your credit cards responsibly contributes greatly to boosting your score, but the process takes time, patience and diligence. Once you've established yourself as a responsible credit card holder, you will see your score rise significantly.

Opening New Accounts

Ten percent of your credit score is based on whether you have established new credit. However, this area can be a catch-22, because applying for too much new credit at once appears to the credit bureaus as though you're desperate for money. If you haven't opened a new account in some time, consider applying for a card. If you've recently opened a new account, opening a new account isn't necessary.

Paying on Time

The biggest way to positively impact your credit score is to make on-time payments consistently. Your payment history accounts for 35 percent of your credit score. When you're repairing your bad credit, it's vital to set up your credit card accounts with automatic payments to ensure that you don't end up missing any deadlines. A single payment made more than 30 days late can lead to a 110 point drop in your credit score. Pay at least the minimums on time, and over time you'll see your score rise.

Lowering Debt

One-third of your credit score is determined by the amount of credit you're using. Your debt utilization ratio is the relationship between your balances and the credit available to you. The Better Business Bureau suggests keeping your balances below 25 percent of your credit limits to keep your credit score as high as possible. Carrying a small balance shows that you know how to handle debt responsibly, but it's important to keep those balances low.

Using Old Cards

The length of your credit history accounts for 15 percent of your credit score, so if you haven't been using your oldest credit cards, dusting it off and making a purchase will help your score to rise. When you stop using a card, your creditors may stop reporting your account to the credit bureaus, so while it's still listed as open on your credit report, it won't count for as much as cards that you're using. Use each of your cards once every few months; then pay the balances off in full.

Adding to Diversity

Credit cards may also help to repair bad credit if you don't have a good mix of credit. Ten percent of your credit score is based on your credit diversity, so if you have more installment loans than revolving credit, opening a credit card may help your score. Installment loans are those that end once they're paid off, like a mortgage or a car loan. Revolving credit is the type that you may continue to use again once the balances are paid off, like credit cards or lines of credit. If you don't have a credit card at all, adding to the mix will help you to boost your standing in this area.