Credit cards for bad credit assist individuals with poor credit scores to rebuild their credit by providing a credit line to be managed by the cardholder. The best credit cards for bad credit come with annual fees as low as zero dollars, and some even offer rewards equivalent to 1 percent cash back or more for purchases. Plus, many credit cards for bad credit report detailed information to the three credit bureaus every month (some only offer a few perks). Even though, these credit cards can be quite difficult to find, they can be the key to repairing your credit.
Credit cards with bad credit are easy to find. In fact, there are so many of them that any potential new client should be able to quickly sift through the various offers to find the best deal. What makes them so appealing is the instant approval concept. It's almost like getting an instant loan, but instead of using your credit score, it's the credit check that determines if you get approved.
With credit cards for bad credit, the risk of late payments is greatly reduced, and there's a built-in incentive to make timely payments. For those with less than perfect credit, paying on time is essential because late payments get reported to the credit bureau and eventually decrease your score. Having a late payment, however, shows the credit bureau that you are responsible, which improves your chances of future credit offers.
Most of the credit cards for bad credit provide the rewards and incentives that come with a higher interest rate. Since credit scores drop as loans are missed, it's in your best interest to pay the minimal annual fees, but get all of the benefits you can. Some credit cards for bad credit that charge annual fees are worth the annual fee, but look at the rewards offered from other cards first. If you're able to get a card with no annual fee and plenty of perks then you'll definitely consider that option.
You also want to make sure you pay off your balance in full each month. With credit cards for bad credit, many companies offer a zero percent APR for six months to a year, but this really isn't feasible if you're unable to pay in full every month. That's why it's important to know how much your monthly payment is before you apply. If it's substantially lower than your anticipated monthly income, take note of this and make the appropriate changes.
Most credit cards for bad credit also charge high interest rates. For this reason, you need to evaluate how much interest you pay over time versus your payment each month. Even if you have great credit, this may not be enough to keep your interest rates low. Use this to your advantage. If you can afford to make your payments, you'll want to find a card with the lowest possible interest rates. This will help you out as you strive to improve your score as well as your overall finances.
Finally, there are a number of secured credit cards for bad credit out there, but only one stands out as having exceptionally low interest rates. The credit card known as the Secured Credit Card for Bad Credit has an incredibly low 1.9 percent interest rate. In addition, you have lifetime protection included, so you can use this one-time opportunity to rebuild your credit history and raise your credit score simultaneously. If you've had financial trouble in the past, this is the card for you.
Now that you know what type of offers to look for and what to avoid, you need to put your application together. The best way to do this is to fill out your application and follow the instructions included by the lender. Typically, you'll be required to make a deposit, which will go towards your balance, as well as set up an automatic withdrawal from your bank account each month. You'll also be asked to choose from a number of rewards. Some of these rewards include cash back, frequent flyer miles, department store cards, gas stations, department store cards, and even vacation packages! As you build your credit and get up to speed on your finances, you can easily apply for secured credit cards for bad credit.
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