Introduction
Credit cards are widely considered to be the most common method of completing purchases while shopping for good online or even in a standard brick-and-mortar store. However, people with a poor credit history will often find it difficult to gain approval for a credit card. If you are in a similar circumstance, you need not fret. There are viable options for people looking to get a credit card, regardless of their circumstance. Some credit card issuers will offer guaranteed approval credit cards, for those people who have been rejected for other credit card offerings. Credit guaranteed cards also offer the opportunity for people with a bad credit score to improve their credit rating, once they establish a good payment record.
History
Even though the very idea of a guaranteed approval credit card seems too good to be true, they do exist. However, most credit guaranteed lenders will take measures to ensure that they take minimal risk in providing their services. For instance, most lenders will place a low limit on a credit card to safeguard the amount of credit they can extend to a borrower. They will also charge higher fees than regular credit cards, to justify the risk they take on individuals with a poor credit history. Most guaranteed credit cards will not take into consideration the applicant’s credit history. They will simply ask for proof of residency, proof of identity, employments and banking information. Guaranteed approval credit cards will often place a $1,500 limit on the amount of cash lent to borrowers, which should be repaid within 90 days. The interest rate charged on this type of credit will usually be higher than a regular card, but this is to be expected with any type of bad credit loan.
Features
You can either gain preapproval for a credit guaranteed card or submit an application yourself. However, it is always wise to follow up the application criteria set by a guaranteed approval credit card lender, to ensure a successful application for this type of credit card. Here are some factors to consider while searching and applying for a guaranteed approval credit card lender. Don’t get too easily enticed with the first guaranteed credit offer you find. Take the time to search for different offers and perform a comparison between the different cards. You will often find that different lenders will charge different interest rates and utilize different policies in providing their services.
Tips and comments
You should avoid submitting to many credit guaranteed credit card applications at once. This is because too many inquiries in your credit report, at once, will have a negative impact on your credit rating. It may not decrease your chances of approval, but it will certainly not improve them either. If you do gain approval for a guaranteed credit card, you should come up with a repayment plan for using the credit card. You should consider the amount of money to borrow and how to meet the payment deadlines, so as to avid unnecessary penalties and higher interest rates. You should also make sure to read through the terms and conditions stipulated for a guaranteed credit card and make sure that you can abide with them.
