Introduction
Having a poor credit situation can be depressing especially because not very many lenders are willing to advance you with credit and those that do charge high interest rates. A bad credit credit card is available for people with bad scores. There are many providers who offer such cards however; there is a certain criteria they use to decide on whether they can advance you with credit. Before you apply for a bad credit credit card, it is important to know if you qualify. Bad credit providers do not employ strict measures to people with poor scores; however, you may have to settle for high interest rates till you prove to the lender that you are credit worthy.
History
Age
You need to be 18 and above in order to qualify for a bad credit credit card. However, certain companies put an age limit of 21. Applicants below this age must have a consigner. It helps your case better if you have a steady form of income even if it is a part time job. The credit company will use you income to calcute the rate and the credit limit to give. In most cases, you will have to apply for a secured card since you are considered a high risk holder. A secured bad credit credit card is also a great way to improve and repair your scores gradually so as to enjoy better credit instruments in future.
Features
Debts owed
It is important to demonstrate to the bad credit credit provider that you are taking measures to repay the debts you owe. Ensure that you make installments to repay the outstanding amounts. If you have too many debts piled up, you should consider engaging the services of a credit counselor who will advice you on what measures to take in order to regain financial control. Debt consolidation is a better approach to dealing with multiple debts. The consolidation company will merge your debts into one loan which makes is easier to manage. This also buys you time since you can choose the repayment plan you want.
Tips and comments
Open credit accounts
Having more than four credit accounts could hurt your report. Strive to maintain a few and ensure that you make timely payments. A bad credit credit card should be looked as an opportunity to help repair your credit situation and improve your scores. A poor credit rating has a negative impact on your financial life. Nowadays, getting auto insurance with a poor score is getting harder and trickier. Strive by all means to improve your situation with the help of a bad credit credit card.
Security deposit
To avoid plunging yourself into more debt, set up a security deposit which will act as collateral. This will also increase the confidence of the lenders towards approving your credit application. Once you honor all your payments in a timely manner, you can negotiate for better terms and the bad credit credit card company may be inclined to increase your credit limit and even give you discounts.
