Starting Over

Q: I am rebuilding my credit with Capital One and would like to open an account with a bank that specializes in rebuilding credit. I would also like to know how to take advantage of banks that offer low interest rates. In addition, how can I find out about the BLACK ENTERPRISE Financial Fitness Contest?
– B. Francis, Washington, D.C.

A: If you are already rebuilding your credit through a Capital One account, you are on the right path. I would recommend not opening any new lines of credit for at least a year.

If the creditor won’t budge on a better rate after a year of consistent, on-time payments, then start shopping around. Go to sites like www.bankrate.com and www.card web.com, which provide listings for all types of credit cards including no-fee, low-rate, and rewards cards. Once you find a card with a favorable rate, consider a balance transfer from the higher rate card to the lower rate card. Keep the original card open — just don’t spend on it. Otherwise, you’ll be paying on two cards and you won’t reap the full benefit of the new, lower-rate card.

This plan of action may be a bit much for the novice credit card holder, so educate yourself before you make the first move. Read Credit Card & Debt Management by Scott Bilker (Press One; $19.95). And to get an application for BE’s Financial Fitness Contest, log on to blackenterprise.com.

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