If you are trying to get a loan or credit card despite having bad credit, it may seem like you are impossible to obtain. This may be the case at one time, but credit cards for bad credit are now quite common. There are now many credit card companies that offer these types of cards for those with low credit scores or histories of bankruptcy and foreclosures. Still, you need to be careful. Just because you have bad credit does not mean you should not be able to get a card.
The easiest credit cards for bad credit to obtain are typically advertised towards those with bad credit as well. These cards usually have much more stricter requirements in place for potential applicants. If you do have a low credit score, bad credit history, or other limited credit, you will likely be rejected for a standard credit card. Still, there are some cards out there that can be accepted for those with very limited credit histories.
The first thing to do before applying for credit cards for bad credit scores is to check your credit score online. You can find it for free very easily. You will need to have all of your personal financial documents ready to present to the lender. The scores will vary from one credit report to another, but they are not all shared. Getting a copy of your score is important, because the company will use this information to determine your eligibility for a new card.
One of the main requirements for credit cards for bad credit scores is that you must have an excellent credit rating. Your FICO score will show whether or not you are trusted. If you have a high FICO score, you can be much more likely to be approved for an offer. The reason for this is that companies will be much more willing to lend money to people with a high credit rating. You should still try to make all of your payments on time and avoid making any late payments. If your accounts are all in good standing, you should be able to qualify.
There are a few different options for those that need credit cards for bad credit scores. The most popular choice is an unsecured Visa credit card. This is one with no annual fee and only a one time application fee. You do not have to pay additional fees if you cancel your account in the first month.
Unsecured credit cards with no annual fee are also a popular choice. They work just like a standard Visa but you do not need to have good credit to qualify. Because you don’t have to pay an annual fee, you can choose to pay off your balance as quickly as possible. You do, however, incur a higher interest rate than you would with a standard Visa. The difference is that you will not be charged a subprime credit card rate.
The next type of credit cards for bad credit people are secured credit cards. A secured credit card is just like a standard Visa, but you do have to have some collateral to guarantee that you will repay the loan. You can usually raise your credit limit at any time by repaying the secured credit card loan.
Both unsecured credit cards for bad credit people and secured credit cards with no annual fee have their advantages and disadvantages. For those that qualify for unsecured cards, they are a great way to re-establish your credit history. You never have to worry about making a large payment and having it assessed to you for security deposit purposes. However, you must have a steady source of income in order to keep the monthly payments current. As with a secured credit card, if you are unable to make the monthly payment, the card issuer can take your security deposit away from you and use that money to repay your unsecured credit cards.