Banks and credit card companies only offer credit cards to people with good credit score. People with a bad credit score will have a difficult time obtaining a credit card from banks and credit card companies. However, you can still find some providers which have specific cards for poor credit.
Having a bad credit score makes you a high risk candidate for borrowing money on a credit card. Some companies will let you get an unsecured credit card but they will give you a very high interest rate because the likelihood that you will not be able to meet some payments is very high. The limit on your credit card will also be lower. You will not be given any kind of perks that they usually give to those with good credit scores. Some credit companies give cash back or air miles to their clients.
If you have a poor credit history, then a better option for you is a secured credit card. There should be some kind of security against the amount that you are going to borrow. The balance on your savings or checking account will determine the credit limit of your credit card. So, if you have a saving account with a certain amount of deposit, there are some card issuers who will set the card limit at a slightly lower amount that the deposit in your account. Not all lenders have the same policies so you need to check their terms and conditions on this.
Some providers allow you to increase your credit limit if the amount in your savings deposit also increases. There are some credit card issuers who will give you an increase in your credit limit even without increasing your bank deposit but only if you are making regular payments. Increasing the credit limit is only according to the lender’s discretion.
Applying for a joint account with a family member with a good credit rating is another option you have for applying for a credit card with bad credit standing. Financially, this is the best option as the terms will be the same as a normal card when it comes to interest rates. Make sure that you don’t miss out on your monthly payments. If you cannot, your co-signatory will need to ensure that he is able to manage payments on your behalf. If he also fails to make payments then both credit scores will be affected.
You need to shop around for the best credit card for bad credit. You can be charged an application fee and annual fee on a secured credit card. If you are having trouble obtaining a credit card with bad credit there are credit card provider who will approve a credit card but will take advantage of you by charging you a very high application fee; make sure to beware of these companies.
Paying your monthly dues will help you improve your credit score with your credit card for bad credit.