Bad Credit Doesn't Rule Out Unsecured Credit Cards
From : isnare.com.
Many people believe that because of their bad credit, unsecured credit cards are not available to them. While it may be more difficult, there are options for people with bad credit who want an unsecured credit card to build their credit or have available for use in an emergency. While a secured credit card is the most commonly recommended option for people with bad credit, unsecured credit cards ARE available - even for those with the worst credit.
Bad Credit: Unsecured Credit Cards vs. Secured Credit Cards
One of the easiest ways to get a credit card when you have bad credit is to opt for a secured credit card. With a secured credit card, you deposit money in a bank designated by the credit card company to serve as a 'security deposit' - an assurance that they'll get their money if you default on payments. Depending on the lender, that deposit might be equal to your desired credit limit, or slightly higher or lower. A security deposit of $300, for instance, might get you a $150 line of credit with one company, a $300 line of credit with another and a $400 one with yet a third. The interest rate is generally competitive, since the company has a guarantee of getting its money if you don't make payments. An unsecured credit card requires no security deposit. A bad credit unsecured credit card will often have either a high APR (annual percentage rate), high fees, or both. How do the two stacks up against each other? Here's a comparison from two actual credit card offers that are sitting on my desk as I write:
Secured Credit Card Security Deposit: $250
Annual Fee: $35
Setup Fee: $35
APR: 15.40%
Credit Limit Increases: $100 increments, each require $100 deposit Bottom Line: It will cost you $370 to maintain a $250 credit limit for the first year, with at least $250 up front, at an APR of 15.40%. You'll have $170 available credit upon receipt of your card. You'll have to put up an additional $100 every time you want to increase your credit limit.
Bad Credit Unsecured Credit Card Annual Fee: $48
Setup Fee: $29
Participation Fee: $72 (annual, billed at $6 monthly)
Program Fee: $95 (one time fee)
APR: 9.9%
Many people believe that because of their bad credit, unsecured credit cards are not available to them. While it may be more difficult, there are options for people with bad credit who want an unsecured credit card to build their credit or have available for use in an emergency. While a secured credit card is the most commonly recommended option for people with bad credit, unsecured credit cards ARE available - even for those with the worst credit.
Bad Credit: Unsecured Credit Cards vs. Secured Credit Cards
One of the easiest ways to get a credit card when you have bad credit is to opt for a secured credit card. With a secured credit card, you deposit money in a bank designated by the credit card company to serve as a 'security deposit' - an assurance that they'll get their money if you default on payments. Depending on the lender, that deposit might be equal to your desired credit limit, or slightly higher or lower. A security deposit of $300, for instance, might get you a $150 line of credit with one company, a $300 line of credit with another and a $400 one with yet a third. The interest rate is generally competitive, since the company has a guarantee of getting its money if you don't make payments. An unsecured credit card requires no security deposit. A bad credit unsecured credit card will often have either a high APR (annual percentage rate), high fees, or both. How do the two stacks up against each other? Here's a comparison from two actual credit card offers that are sitting on my desk as I write:
Secured Credit Card Security Deposit: $250
Annual Fee: $35
Setup Fee: $35
APR: 15.40%
Credit Limit Increases: $100 increments, each require $100 deposit Bottom Line: It will cost you $370 to maintain a $250 credit limit for the first year, with at least $250 up front, at an APR of 15.40%. You'll have $170 available credit upon receipt of your card. You'll have to put up an additional $100 every time you want to increase your credit limit.
Bad Credit Unsecured Credit Card Annual Fee: $48
Setup Fee: $29
Participation Fee: $72 (annual, billed at $6 monthly)
Program Fee: $95 (one time fee)
APR: 9.9%
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