Can I Build a Credit History With a Rush Card?

Using a Rush card could reduce overspending, eliminate most fees, such as overdrafts, and most importantly, build credit. However, the credit you build with a Rush prepaid credit card may not help you acquire a loan, because the company that issues Rush cards reports to an alternative credit reporting agency. If you want the best chance at a loan, you should have an account with a lender that reports to a major bureau.

Identification

Rush credit cards are prepaid accounts, which means you must load money onto your account before spending. Unlike most prepaid cards, the Rush card reports to an alternative credit reporting agency called PRBC -- formerly known as Pay Rent, Build Credit. An alternative credit reporting agency lists accounts not reported by the national credit bureaus, such as prepaid accounts or accounts with a lender that does not subscribe to the national credit bureau's reporting services.

Considerations

In 2011 alternative credit agencies have a dubious benefit to borrowers because lenders do not traditionally accept alternative scores. Most lenders use reports from Experian, Equifax or TransUnion and usually all three. Thus, while a borrower can use an alternative credit score to gain credit, he has far less options than someone with an account that reports to at least one of the three major bureaus.

Benefits

If you cannot qualify for a loan or account that reports to the major credit bureaus, an alternative score might be better than nothing. Also, alternative scores have an excellent predictive value, so they might become important in the future. Some credit scoring agencies, such as the Fair Isaac Corporation, have credit scoring models that include data from alternative agencies such as PRBC.

Tip

While no creditor can guarantee approval, borrowers almost always have the option of a secured credit card account to build credit with the major bureaus. Secured accounts require a security deposit, so lenders rarely have a reason to reject an application for one, even from people with a recent bankruptcy. Apply for one from a national bank because small lenders may charge excessive fees, suggests Bankrate.com.