Unless you’ve been living under a rock, you know a good credit score matters. Although the ideal one is subjective, depending on your lender, more often than not, it should be 700 and above. If you fall around 300, it can already be a bad credit.
Bad credit makes applying for a loan or other forms of credit difficult. It sends the message to your potential lender you don’t only know how to pay but you may also be irresponsible with handling finances.
But one of the best ways to repair (or increase) your credit score is to get a new credit. Fortunately, you can do that by applying for credit cards that are for people with bad credit. For more info on how to look and apply, refer to the tips below:
1. Understand the kind
There are two general types of credit cards for bad credit. The first one is unsecured, which is the more available. It means you don’t need to provide collateral, which may be a good amount of money. However, this doesn’t mean application and qualification are easy. The lender may request for more documents to prove your payment capacity. It’s also common to receive high interest and annual fees.
If you want to lower these numbers, you can apply for a secured credit card after you provided its desired cash deposit.
2. Make it count to your credit report
The purpose of applying for a credit is not just to help you tide over when you don’t have cash. It’s an effective way of rebuilding your credit history. But this doesn’t happen unless the lender reports your repayments to the credit bureaus. Furthermore, look for a lender who makes only soft inquiries, so these don’t reflect on your credit report.
3. Know how much to pay
Credit cards earn in many different ways: interest rates, other fees, and annual payments. If you have a bad credit, expect these numbers to be higher than those offered to people with good credit scores. However, if they are several times higher, you should be wary. After all, it makes repayments even more difficult. In turn, you are more likely to go on default.
But how much is too much? Know the prevailing interest rates and fees in the market. For more info, use comparison websites.
4. Look for those that give incentives
Just because you have a bad credit doesn’t mean you’re no longer entitled to incentives. These credit cards similarly as the others – that is, you can have cashbacks and rewards for your every purchase. For someone who doesn’t have a good credit, this is important. It means you can save more money or get a better value for your repayments and use.
Remember, though, the goal is not only to get a credit card but to improve your history and score. It always pays to pick a lender that’s willing to support you with such goal. It should help you get a free credit score and provide you with fees and interest you can afford.
For more info about credit cards for bad credit, visit www.creditcardforbad.credit.
Got bad credit but want a credit card? It’s still possible. For more info on how you can get one, check out www.creditcardforbad.credit.