"Bad Credit" Credit Cards: How You Can Avoid High Fees

Individuals with bad credit often suffer unfairly from high mortgage, insurance, and car loan rates. On top of that, they have difficulty getting approved for credit cards.

There are only a limited number of credit cards choices for individuals that are trying to improve a poor credit score. They all help improve your credit by reporting to the major credit bureaus on a monthly basis. However, you must read the fine print before applying for a secured credit card, as they often charge high set-up fees.

Here, I will examine a few examples of charges “bad credit” credit cards bury in the fine print.

“Bad Credit” Credit Card #1: This credit card charges a extremely low interest rate for an unsecured credit card. However, reading the fine print reveals that there is a one time setup fee of $29. Not too extreme so far. The next charge is a one time fee of $95. So far, we’re up to $124 in expenses. That’s got to be it, right? No. Add in another $48 for the annual fee and $6 per month in account maintenance fees. That brings the cost of your new credit card to $244 the first year, and $120 each additional year. This is not a small sum of money to anyone, so this card should only be considered if cannot get approved for a better unsecured credit card for poor credit.

“Bad Credit” Credit Card #2: This credit card charges a very high interest rate for an unsecured credit card. But the setup fee is only $29. There is that pesky monthly maintenance fee of $6.50 per month which brings the cost of this unsecured credit card to $107 per year. Maybe we’ve found a bargain. Not so fast. The annual fee is a whopping $150. Yes, $150 every year. That not only brings the initial cost up to $257, but you will also pay $228 a year just to maintain the credit card. There has to be a lower cost credit card out there for people with bad credit.

“Bad Credit” Credit Card #3: This credit card is available as both a secured and unsecured credit card, based on the companies review of your credit score. The interest rate is about average. Now, the fine print reveals that there is a one time administrative fee. However, based on your credit, this fee can be as low as $0 or as high as $49. So far so good, especially if your credit is not that bad. The annual fee for the secured credit card is only $35, and for an unsecured credit card, this fee can be as low as $39 or up to $79. So far, the cost of this card ranges from $35 to $128. The monthly maintance fee is only $0. That means the most you could possible be charged to obtain this credit card is $128, about half of what competing cards are charging.

Clearly, there are substantial difference between the “bad credit” credit cards listed above. Of the three offers we have examined, only one doesn’t take you to the cleaners. In fact, “bad credit” credit card #3 provides great value. All the positive changes to your improved credit history and credit score will translate into lower loan rates, lower credit card interest rates, lower insurance rates, and ultimately, thousands of dollars in savings. The path to rebuilding credit has its costs, but in the long term, rebuilding your credit with a “bad credit” credit card is the fastest and most cost-efficient way to correct the often unfortunate circumstances that have damaged your credit in the first place.

Easy To Get Credit Cards Are Available

The reason people look for an easy to get credit card usually is because they have a poor credit score.

If you have filed for bankruptcy you are probably finding it difficult to improve your credit score. Your past credit mistakes are a major reason for your difficulty in getting new credit.

While there are a few things to do to lessen the effect of a bad history has on your credit report now, but one of those options (waiting until it is no longer on your credit report) is not a good idea if you need a credit card immediately.

You can improve your credit in a very short time by getting a secured credit card. There are some companies that will offer instant approval credit cards. Essentially, these are some for people with poor, no, or bad credit. By keep paying on time on your new credit card, you can build up your positive credit history so that you will be able to get loans and other credit cards in the future.

How easy is it to get a credit card?

It really is not that hard to qualify for a secured credit card online that is designed for people with low credit scores. The real catch though is that most of these are total junk. By examining these credit card offers closely you will find that most of them want hundreds of dollars in application fees combined with monthly charges . The credit jungle is a swamp of applications fees, monthly fees, annual fees, membership fees, and the just-because-they-feel-like-it fees.

The key thing to keep in mind is to be careful. Ask yourself--Did my poor payment history get me into this mess in the first place? If it did, how have I changed? Be realistic.

It's difficult to live in modern society without a credit card. Some needs are internet purchases, car and hotel reservations, and emergencies. Always compare the monthly fees, annual fees, membership fees, applications fees, and always check the fine print.

Secured Credit Card - The First Step to Rebuilding Credit

Having low credit scores can make getting a regular credit card difficult, but the situation is not impossible to fix. There are options to get what is known as a secured credit card that you are virtually guaranteed to be approved for.

If you need or want a credit card but are worried that your poor credit history will stop you, then you perhaps you need some advice about how to get a credit card even with poor credit scores. Follow these steps to have a much better chance of getting a secured credit card:

Retail Store Credit Cards

If you have low credit then one of the best places to start applying for credit cards are at small retail stores. Retail Stores typically have high approval rates, but their interest rate and fees can sometimes be high as well If your application is approved, then buy something small each month and then pay off the bill. This will show other credit card companies that you are able to handle credit and pay your bills. Make sure that the credit issuing company reports to the three major credit agencies.

Get a Bank Credit Card

After you have had a store credit card for some time, the next step is often to apply for a card at your bank. If you have been with your bank a long time and you have performed well with them, then they might be able to help you out.

Secured Credit Cards

If you are like most people with poor credit and are unable to get a bank or store card, then try and get a secured card first. This involves putting down a deposit that is held by the credit card company while you use the card. This collateral takes away some of the risk for the lender and approval for this type of card is almost guaranteed. Check to make sure that if you pay your bills then eventually you can upgrade to a regular unsecured card.


Avoid annual fees

Avoiding applying for any card that has a annual fee used to be much easier. There used to be plenty of credit card companies that did not charge annual fees - but those times are rapidly changing. Almost every secured card also requires an annual fee. Stick to well known card types like Secured Visa and MasterCard as they are the most widely accepted. This will help you to make the most of the credit you have.

Using your card

Once you have a card, remember that using it to increase your credit score. Only spend what you can afford to pay off at the end of every month . If you pay off your bills on-time, then your credit rating will improve in a matter of months and you can get better terms and a higher credit limit.

How To Get Zero Interest Credit Cards

Zero interest credit cards are probably the most under-utilized and least understood way to get on one's financial feet. There's plenty of advice available on using debt consolidation loans to consolidate credit card debt and help with monthly payments.

Special zero interest rate credit card offers provide a excellent way to significantly reduce monthly expenditures on credit cards as well as a way to get out of debt sooner, often for less money.

Who Can Use Zero Interest Credit Cards?

You don't have to be financially challenged to find yourself over your limit on credit cards. Serious illness, emergency repairs and job loss are just a few common situations that can cause our credit card balances to soar out of control.

Most of us hope that things will get better and we will be able to catch up later. Unfortunately, the higher your credit card balance becomes, the higher your monthly payments.

This rising mountain of debt can keep us poor and make it very difficult for us to ever get back on our feet.

How Zero Interest Credit Cards Can Help.

The largest part of your monthly credit card payments are interest charges. Therefore, it only makes sense to reduce the interest costs as fast as possible and you can't get lower than zero interest.

By simply transferring your credit card balances to one of the many available zero interest credit cards offers you will be able to save the money you would have spent on interest for a given, introductory period of time.

There are low interest credit card offers available that it can be difficult to sort through them and choose the best one for your needs.

It is important to choose an offer with low balance transfer fees and a long introductory period during which you do not have to pay any interest at all. The easiest way to apply for a zero interest credit card is to use a online credit card review site which has already done most of the research for you by finding the best deals and reviewing their pros and cons. These sites not only give you a number of cards to choose from, they also offer online applications to make things convenient and easy.

Never Pay Interest Again With Zero Interest Credit Cards.

However, to make the best use of zero interest credit cards, you can keep transferring the balance to new zero rate credit card offers before the end of each introductory period. If you can do this you will never have to worry about paying interest again.

Unfortunately, even with the best intent in the world, life tends to take over and we can easily forget to transfer the balance before regular interest payments kick in.

By taking full advantage of zero interest credit cards, you can substantially improve your cash flow. Follow this advice, and you'll never go back to paying high interest fees again.

Improve Your Credit Score - 4 Proven Tips

As a shopper you’ve learned the importance of establishing a good credit score with your lenders. Whether you are shopping for a new home or auto, or searching for the best deals on insurance, your credit value will be judged by your credit rating or credit score.

A poor credit history or bad credit habits will place “black marks” on your credit report. These include things such as judgments, charged off accounts and of course back child support.

Building good spending habits will improve your credit score. This will be reflected in potential lenders offering you substantially lower interest rates and better deals on credit offers.

Here are 4 tips to help you increase your credit score:

1) Pay Your Bills On Time

Lenders only have your past payment history on which to decide the type of credit risk you present to them. How you pay off your debts now indicates to them how you will pay off future debts.

2) Use the Right Mix of Credit Cards

How much is too much ? How little is too little ? Many credit experts and financial planners suggest two to four credit cards is just the right mix.

3) Pay At Least The Minimum Due

Always pay at least the minimum due payment, but never less. And remember, just paying the minimum payment means it will take you years and years to pay off that credit card.

Example: Paying off a $2,000 credit payment at 18% APR with a minimum monthly payment of 2% ($40 dollars or less) will take you 30 years to pay off the amount plus interest.

4) Review Your Credit Report Regularly

Monitor your credit report from all three major credit bureaus - Experian, TransUnion, and Equifax - on a regular basis. Check your credit profile at least annually. Review it carefully and make sure that any past mistakes or disputes have been corrected.

Also, if you notice a charge account that you know that you have not do not remember opening, contact that creditor and the credit bureaus immediately. This could be a sign that your the victim of identity theft. Request to have a fraud alert placed on your profile to protect yourself and your credit score. Identity theft is the one of the fastest growing consumer crime in America, with an estimated 1 million people victimized each year.

Establishing good credit habits early in life and you can reap the benefits that your good credit rating will provide you for the rest of your financial future.