Easy Credit Cards – What Options Do I Have With Bad Credit?
Do you have a damaged credit history? Looking for a credit card with an easy approval process? Contrary to what you may believe even with past financial mistakes you can still qualify for quite a few different cards. Let us examine how each type will work and which one is best suited for your needs.
1. Unsecured – This is a traditional card in that you will be issued a major Visa or MasterCard with a credit limit. You will be responsible to make monthly payments and charged an interest rate.
These cards have virtually disappeared for individuals with a low score. However if you have around a 600 or higher FICO score you may qualify. The reason many of these offers disappeared is because of the new legislation Congress passed.
This legislation was trying to prevent lenders from ‘preying’ on those with a low score. It set standards on interest rates and fees. However we have already seen a few issuers work around these new rules in the industry unfortunately it is at your expense.
There are a few unsecured cards that may approve you however they have a 36% APR listed on there terms and fees. Additionally you must make a $95 security deposit; you will also be charged a $78 annual fee, and a monthly processing fee of $8.
We aren’t sure how this is legal but we are confident it is, it is just too bad because these are much worse and much more expensive terms than were previously offered, before the Congress crackdown. These accounts will benefit your credit the most of all the types available to you.
2. Secured – This will work in much the same way as unsecured however you must first make a deposit in an FDIC insured account. This deposit is fully refundable but it is what secures your account.
You can decide on the amount of your deposit, it typically ranges between $200 – $5,000. The amount of your deposit will equal the amount of your credit limit. For instance, if you deposit $800 you will be issued a card with a limit of $800.
There is no credit check for this card and it will report monthly to the credit bureaus. You will be charged a much lower interest rate too, due to this account being secured. You will likely pay about 10% APR.
3. Pre-Paid – These are not credit cards per say. Instead you must first deposit money and then you can use your card to buy things. It will be issued as a Visa or MasterCard and is accepted world wide. It is also accepted online and over the phone.
Frequently they will give you free direct deposit and free bill pay. Bill pay is a way you can have a check mailed in your name to pay your bills; this eliminates your need to purchase a money order. These cards work just like a checking account and were created for individuals without access to a bank account.
In sum, despite having a low score you do have options for a card. It is always a good idea to put some energy into fixing a damaged credit history. You can remove bad credit and improve your score.
For a free credit consultation call 1-800-483-0256 or visit us to learn more about easy credit cards and how they work or for more about bad credit visa cards visit us.