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Credit Cards For Bad Credit (PDF)

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Credit Cards For Bad Credit


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499


Summary:
Having a bad credit history will make it more difficult for you to get another card, but not necessarily
prevent you from getting one. This is because many banks, if they feel that an individual with a bad credit
history has good intentions to pay bills, will offer bad credit credit cards to re-establish a good credit rating.


Credit cards for bad credit fall under two catogeries – Secured and Unsecured credit card for bad credit.


With secured credit cards for bad credit...



Keywords:
bad credit, finance, loans, credit repair, credit cards



Article Body:
Having a bad credit history will make it more difficult for you to get another card, but not necessarily
prevent you from getting one. This is because many banks, if they feel that an individual with a bad credit
history has good intentions to pay bills, will offer bad credit credit cards to re-establish a good credit rating.


Credit cards for bad credit fall under two catogeries – Secured and Unsecured credit card for bad credit.


With secured credit cards for bad credit, you will be required by the bank to deposit a certain amount of
money that may range from a few hundred to several thousand dollars, into your savings account as security
for your line of credit. Your credit line is a percentage of your deposit, somewhere between 50 to 100
percent. The bank will then issue you a card with a spending limit equal to your credit line, which will serve
as collateral for use of the credit card for bad credit. The money in the savings account, or the collateral, will
be used to pay the balance if you fail to pay your credit balance. It is also probable that you’ll be paid
interest for your deposit but you may also have to pay application and processing fees.


As for unsecured credit cards for bad credit, the bank will not require you to deposit an amount as security
or collateral. However, you will be issued a credit card for bad credit with a low spending limit that may
range from a few hundred dollars to one or two thousand dollars, and very high fees. Your spending limit
will also be increased if you continue to prove your ability, and good intentions of making payments in time.
Make sure that the issuer reports to a credit bureau if you’re applying for a secured card to build or re-
establish a bad credit record, so that a proper credit history can be built by the bureau.
When looking to apply for a credit card for bad credit, watch out for scams and deceptive ads. The Federal
Trade Commission (FTC) has launched a campaign and taken action against such misleading companies and
agencies. Learn to identify frauds and scams by studying telltale signs such as those offering credit card
without examining your credit report, a call to a “900” number for which you are billed (without you
knowing how much), and cards offered by credit repair companies.


When applying for a credit card to rebuild credit, most of the major credit card companies such as Bank of
America, Bank One, Capital one etc will be able to assist you in getting a secured credit card. This will
ensure improvement in your credit history because ever payment made in time will be reported to one or two
credit bureaus. You may also eventually receive an offer for an unsecured card with a significant spending
limit if you continue to follow rules and pay your credit card bills and other payments in time.




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posted:12/31/2011
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