As the current economic downturn progresses, more people are finding themselves in serious debt. Thus, credit scores are lowering and is causing some the added problem of being denied on many credit applications.

Fortunately, rebuilding your credit score can be done. The first thing to do is to look at your finances and see where spending can be curbed. Eliminate any unnecessary purchases. This will free any extra cash to be used for paying down your debt. If paying current credit card charges, start by paying down the highest interest rate first with more than a minimum payment.

It used to be thought that prepaid credit cards weren’t worth the time. Actually, this is an excellent way to put a limit on your spending, while at the same time, if used correctly, will rebuild your credit score in a rapidly.

One way to do this is to first decide the amount you want to put on the prepaid card. These can be purchased at almost any grocery or discount store. When paying your bills, total the amount of all the bills that you are planning on paying(utility bills, phone, television, etc.). Be sure to include a little extra, ($10) so you will have enough. You can then pay your bills as usual without incurring any interest. As these prepaid cards are Visa or Master Card, it will be reported to the various credit agencies.

Obtaining a secured credit card (small credit limit) is an option. These cards usually have a fee attached when applying for one. The interest rates are higher than a traditional credit card, however, you will have a pre-determined amount to use. Paying a bill or purchasing something of an amount that you would be able to turn right around and pay off and doing this several times each month will build your credit very quick. Remember, If you wait until the bill is due, you will incur interest.