How to Get a Credit Card with Bad Credit
One of the major disadvantages of having bad credit is that you will frequently have trouble qualifying for a credit card. As we all know that can be a major problem because many places of business, including hotels and car rental agencies will not do business without you providing a credit card. Failure to possess a credit card may also mean you canít make purchases online as well. All in all, not having a credit card can be a major inconvenience. The good news is that you donít have to live without a credit card; there are some things you can do to obtain a credit card even if you have really bad credit.
One way to manage the problem is to take out what is known as a secured credit card. A secured credit card is backed by a deposit you make to cover the costs you charge on the card. At first this may not sound like much of an advantage, especially if you are strapped for cash. In reality; however, this type of arrangement can help you to build your credit back up to a reasonable number while also providing you with the convenience of possessing a credit card for renting cars, reserving hotel rooms, etc. Depending on the company you elect to go with, you may be able to obtain a secured credit card with a credit limit as high as the deposit you can afford to make.
Another option is to purchase a pre-paid credit card. You may wonder how that is different than a secured credit card. With a pre-paid credit card the money you pay for the card goes directly to the expenses you charge on the card. This is different from a secured credit card because with a secured credit card you are responsible for making the monthly payments on the card for the expenses you charge. The security deposit is just in case you donít pay back the money.
You might also wish to obtain a credit card offered specifically for those individuals with bad credit. While this type of option will get you the credit card you need it doesnít come without drawbacks. For example, youíll probably be charged the highest interest rate allowable and your maximum credit line will probably be quite low. When you first take out the card, you can expect for your credit line to only be about 0 or perhaps even less. As you make payments on time, pay off the expenses you charge and make an effort to keep your balance below the maximum credit, you may qualify for lower interest rate and credit line increases.
Regardless of which method you decide to use when obtaining a credit card for your bad credit situation, remember there is generally a reason why you have bad credit. It may have been due to a financial hardship that is now no longer a problem, but be sure to use discretion and good judgment to ensure you donít create even more financial problems.
About the Author: Joe Kenny writes for Card Guide, offering information on credit cards in the UK, apply for a credit card with a 0% balance transfer rate and start clearing credit card debt today.
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