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Credit cards with poor creditAs per statistics one in four people suffer from poor credit rating, and when it comes to applying for a credit card then it can be a difficult task. People can fall into bad credit because of a number of reasons, which include bankruptcy, pending county court judgments (CCJ), individual voluntary agreement (IVA), missed payments on loans, defaults, divorce, mortgage arrears etc. By this it is understood that anyone can be a victim of bad credit.
Even though you are suffering from bad credit there are a number of companies in the market that are ready to give people credit cards despite poor credit scores. However, such credit cards would be obtained at higher interest rates. Once that you start making your payments on time you would slowly start improving your credit score and the provider can consider you for a credit card with a better interest rate.
Types of cards available
For people with poor credit there are different types of cards available. Such people can apply for secured, unsecured or prepaid credit cards. Let us see each of these cards in brief.
Prepaid credit cards: These are similar to debit cards. In order for getting these cards you are required to have an account with the bank that gives out such cards and you are required to deposit some amount of money. This money would serve as your credit limit and when you use the card the amount is debited from your account. Once that the amount in your account is over you cannot use your card. For people who wish to improve their credit score through credit cards such cards are not suitable, as these accounts are not reported to the bureaus.
Secured credit cards: these cards are given out against a collateral, which is some amount of fund in the savings account. These cards are similar to the normal cards excepting the collateral aspect. There is a fixed amount of money that you are supposed to deposit in your account in order to use these cards. This deposited amount also serves as your credit limit. It depends on the bank whether they would report your account or not to the bureaus. The interest rate charged on these cards is higher as compared to the regular cards.
Unsecured credit cards: These are the usual credit cards excepting that they come with a higher interest rate and fees. Moreover the credit limit for people with poor credit for such cards would be low usually around $250 to $300. But as the person keeps making payments on time this limit would increase. There are many such cards that would charge you an upfront fee for giving out these cards and the interest rates can vary from 9%-25% and the annual fees can also vary from $50 to $100 or can even go up to more than this. The payments towards these cards is reported to the credit reporting bureaus and hence such cards can help you in rebuilding credit.
What should you look for?
When you take such cards you should compare the terms and conditions of the card and also make sure that you check the fees and interest rates that are charged. You should make sure that you compare different offers and go for the one that you feel is the best for you. Remember that if you fail to make the payments towards this card on time you would have to compromise more on your credit score. Hence it is advised that you make sure that you would be able to make your payments on time and would use the card sensibly so that you dont end up making extravagant expenses.
Some of the credit cards that I found good enough for people with poor credit are listed below with the APR and fees.
First PREMIER Bank Gold MasterCard: They offer credit cards to people with poor credit at Regular APR 9.9%, Annual Fee: $48.00. There is no introduction APR.
Orchard Bank Platinum MasterCard: Their credit card for people with poor credit is available at regular APR of 14.90% and an annual fee ranging from $39.00-$59.00.
Centennial Gold MasterCard from First PREMIER Bank: Their credit card is available at regular APR 9.9% and annual fee $48.00.
New Millennium Bank Secured Platinum Visa or MasterCard: This is a secured card available at regular APR of 19.50% and annual fees of $59.00. You can opt for balance transfers with this card.
UltraVX Visa: They offer secured credit card to people with poor credit at a regular APR of 14.90% and annual fee of $83.40. You are also required to pay a monthly fee of $6.95.
Orchard Bank Secured MasterCard: This card is available to people with bad credit at a regular APR of 14.90 and an annual fee of $39.00 - $79.00.
All-Access Visa Prepaid Card: This is a prepaid credit card for people with poor credit available at a monthly fee of up to $9.95.
Baby Phat Prepaid Visa RushCard: This is a prepaid credit card available at no monthly or annual charges.
Eufora Pre-Paid MasterCard: This is a prepaid credit card that reports your account to the credit bureaus. It can be availed at an annual fee of $29.95-$99.95. With so many cards available in the market it is not difficult to qualify for one even if you have poor credit. However make sure that you are aware of all the terms before you sign on the dotted line.
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