Building Credit Scores With Gas
The economic crisis and the credit card crunch left a lot of consumers with damaged credit scores. With the economic downturn still continuing and the employment rate still up, a low credit score can be a big problem for consumers.
A low credit score will make it difficult for consumers to secure a loan or credit. Consumers carrying debts will also be unable to negotiate for better terms if their credit scores are too low. Credit card holders are understandably eager to build up their credit scores and methods for building up credit scores have become a premium nowadays.
A novel way to build up credit scores is to build it up with gas. A number of gas stations offer their own, private label credit cards which can actually help consumers build a positive credit payment history and help their credit scores go up. What is even more interesting is that, unlike traditional credit cards, private label gas credit cards are relatively easier to get a hold of. They usually carry underwriting terms that are easier for consumers. If a consumer is also able to keep up with the monthly payments of the gas credit card for a minimum of one year, he or she will also have a high chance of getting approved for a regular credit card line.
Usually, gas companies offer their private label gas credit cards without any annual fees – which is a relief for consumers who are now getting deluged with annual fees with their regular credit card lines. The downside is that private label gas credit cards also usually have higher interest rates compared to regular credit cards. The average rate for gas credit cards is close to 20%, higher than regular credit cards whose rates average at around 14% nationwide.
For private label gas credit cards to actually help in building up the credit score of consumers, it is important that they keep up with their monthly payments. If they are unable to do so, they might just end up making things worse for themselves.
Aside from being relatively easy to get and helping credit card holders with credit score problems recover, private label gas credit cards are also usually offered with very interesting promotional offers. These include free fuel for a limited amount of time and rewards points that can be redeemed in the form of billing statement deductions, airline flight payments and others.
Private label gas credit cards are usually offered by gas companies through major credit card companies such as Citibank and GE Capital.
