You may have seen ads for a “Chime Credit Builders Visa Secured Credit Cards.” These are the same credit cards that many people are familiar with- Visa and Mastercard. These are not your typical credit cards. This article explains what the difference is between this type of card and the ones you probably already know about.
Let’s first talk about what a credit-builder is. Basically, it is a company that offers rewards cards, like the ones we all know. They make money from your purchases. But instead of giving you cash, they give you points that can be traded in for a gift card or other reward. You can accumulate even more points as you earn them. These companies will stop offering rewards cards once your points have been exhausted.
What does a credit builder card offer you instead? On the surface, this may seem like the same basic idea as the ones you have probably heard about. However, the way in which these cards operate is very different from your run-of-the-mill cards. Here is how it works.
In simple terms, you will be paying your bill monthly in installments. Each month, you will make a payment until you reach a set amount. You can choose to pay more than the minimum amount if you wish. The catch here is that you will lose points every month that you do not pay your bill on time. Poor credit scores are not going to help you if you already pay your bills through the credit rating agency.
You might be wondering how the Pros manage to have a strong payment history and a low score. The answer is simple: The Pros have access to information on lenders that are not reported to the big three credit bureaus. Pros know that a strong payment history will increase your score.
The Pros will open an account at a financial institution that has been reported by all three major credit bureaus. One such institution is TransUnion. Since you already have a TransUnion account, all you have to do is start using your TransUnion credit score to apply for a Chime credit score improvement program. All the rest is handled by the pros.
You can also benefit from safe credit if you own your home. As you have seen above, the Pros have access to lenders that do not report to the major bureaus. These lenders are more likely than others to approve you for a loan. The point of this application is to build credit and improve your score. The safer credit feature associated with the Chime credit history builder is designed to help you build credit faster. You can also control what lenders see during approval of your application, which improves your overall score.
Finally, if you have ever had trouble paying your bills, then you will also be able to benefit from the on-time promise. The Pros are experts in the system and can avoid scams so your bills will be less likely to bounce or be late. This will lead to better credit score building and more money saved over time. Overall, if you are looking for a credit building tool that is easier to use and understand, then the Chime credit score app is definitely worth checking out.