Poor-Credit Credit Cards - How to Get Approved For A Credit Card with Poor Credit
If you are among those who suffer with poor credit, then you know how difficult it is to get approved for a credit card. When you do receive offers for credit cards in the mail, they are for cards with high interest rates, high annual fees, and low credit lines. If you are already struggling with debt, these cards are just going to add hundreds of dollars of expenses each year for nothing more than the convenience of having a credit card. Additionally, these cards generally have high late and overlimit fees that are problematic for borrowers who already have trouble paying their bills on time. However, credit cards are great sources of rebuilding credit for those who have had credit problems, and there are options out there.
Secured Credit Cards
Secured credit cards require you to deposit money into a savings account to be used as collateral. For example, if you deposit $500 into a savings account, then your credit limit on your secured card would be $500. You then use the card just as you would any other credit card, the difference being that if you cannot repay the borrowed money, it is simply deducted from the balance of the savings account that you would receive upon closing the account. Secured credit cards are primarily for borrowers who want to rebuild their credit, so they generally report to all three major credit bureaus monthly.
Unsecured Credit Cards
There are companies that offer unsecured credit cards to consumers with poor credit. However, many of the companies are those that charge outrageous fees in an attempt to take advantage of those who struggle with getting approved for a credit card. In order to avoid this, it is important to shop around for the best deal, looking for cards that are expressively for consumers with bad credit. Try to choose reputable companies, and apply for only the best three deals you find. Frequent denials for credit will only lower your credit score. If you are denied credit through three companies that offer cards to borrowers with poor credit, an unsecured credit card is probably not the choice for you.
Department Store Credit Cards
Another option for obtaining a credit card is to apply for a department store, grocery store, or gas station credit card. These types of cards generally have less strict guidelines on whom they offer credit. This can be beneficial for consumers who frequently shop at the store they obtain credit through because they are more likely to use the card for necessary expenses, and less likely to splurge on items they wouldn’t buy with cash.
After you are approved for a credit card, pay your bill on time every month. This will strengthen your credit score. If you can pay your bills on time every month for a year, your chances of getting approved for a better credit card will greatly improve.
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