For people with the highest credit scores, the economic landscape does not affect the overall availability of unsecured credit card applications. However, it does impact the terms that are offered. During times of financial hardship, interest rate deals and rewards fall. During times of financial recovery, credit card companies are very competitive in their pursuit of the most exemplary consumers. They’ll offer initial rewards bonuses and 0% introductory interest rates as part of their courtship.
On the other hand, the economy does affect whether unsecured credit cards for fair or limited credit history are available at all. When times are tough, issuers become more conservative and usually do not want the added risk of offering credit cards with no security deposit to unproven consumers. During those times, secured cards are the only option available.
There is no secret for how to get a credit card with bad credit, other than choosing the right kind of card. There are two types of credit cards that you can get with a poor credit score: secured credit cards and unsecured credit cards for people with bad credit. Both types report account information to the major credit bureaus each month, which means either can help you rebuild your credit if used responsibly. But they’re far from equal in terms of accessibility and cost.… read full answer
Secured cards are the easiest credit cards for anyone to get, offering nearly guaranteed approval even to people with very bad credit. Some don’t even check applicants’ credit history, which means there’s no hard pull to hurt your score more. Secured cards also charge much lower fees than unsecured cards for bad credit.
All of that, from the high approval odds to the low fees, is thanks to the fact that you have to place a refundable security deposit to get a secured credit card. The amount of this deposit, which you typically have to place when you apply, usually serves as your spending limit. This prevents you from spending more than the card’s issuer knows for sure you can afford to repay. And without the risk of being left with an unpaid balance, the issuer can afford to approve more people as well as offer more attractive terms.
Now that you know the lay of the land, the path to plastic despite poor credit should be clear. But for your convenience, we’ll lay out step-by-step instructions below.
How to get a credit card with bad credit:
Compare secured credit card offers. Shopping around will help you find the card with the lowest fees, lowest deposit requirement and highest approval odds.
Fill out an application. Applying online is best because you get a decision soonest.
Place your security deposit. You’ll have to submit your deposit either when you apply or after approval but before opening an account. You can usually fund the deposit with a transfer from a bank account or prepaid card. The funds will be returned if you don’t get approved or when you close your account (minus any unpaid balance).
Get approved. It’s possible to get rejected for a secured credit card, but not likely.
Getting a credit card with bad credit can be tricky. But it’s crucial to open an account as soon as possible in order to begin repairing your credit reputation. A secured card allows you to do that. And it has the added benefit of helping you avoid being rejected repeatedly, which would only make matters worse.
No matter which secured card you choose, paying your bill on time every month will add positive information to your credit reports, which will help cover up past mistakes. But sometimes that’s not enough. Some people with bad credit need a credit card with no security deposit to cover emergency expenses. In that case, an unsecured credit card for bad credit is your only option.
You won’t have much of a selection when shopping for an unsecured card with bad credit, unfortunately. You won’t get too much extra spending power, either, because high fees will initially consume much of your credit line. But it’s definitely possible to get approved for such a card. Just compare your options and double-check the eligibility requirements in their terms and conditions to make sure nothing in your background rules you out.
So, to recap, a secured credit card is your best bet if getting approved and beginning to rebuild your credit as soon as possible is your top priority. But if you need an emergency loan, you’ll have to make do with a costly unsecured card for bad credit.
A credit score of at least 550 to 650 is needed for an unsecured credit card in most cases, though it’s possible to get approved for an unsecured card with a lower score or even no credit score. For example, some of the best beginner and student cards are unsecured and will approve applicants with little or no credit.… read full answer
If your credit score is below the 550 to 650 threshold needed to get a good unsecured card, you’d be much better off applying for a secured card such as the Discover it® Secured Credit Card or the Capital One Platinum Secured Credit Card. They’re easier to get than unsecured cards because you’re putting up your own money, typically a minimum deposit of $200, to secure the account.
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