If You Have Bad Credit, We’ve Got The Credit Card For You | Credit Cards For Bad Credit – What You Need To Know

If you have bad credit, you don’t need to be told that this is hurting your financial future. You can tell this because you are denied an auto loan or a mortgage. Or if you have been accepted for credit for these types of loans you’re offered ridiculously high interest rates. You may need to resort to using credit cards for bad credit in order to dig yourself out of this credit hole that you have gotten yourself in.

Before you begin to research the right credit card for your situation, you may need to educate yourself on the right terminology so you can understand the terms and conditions that each different bank has on their bad credit credit cards. You will need to understand what credit limits, APR, fees and credit bureaus the card reports to before you apply.

Credit Cards For Bad Credit – What is the APR?

APR stands for Annual Percentage Rate and it is the interest that the card company will charge you for using their card. The interest is applied to the balance that exists on the card. The minimum payment is then derived and you pay it every month. The monthly payment is partly the interest charged as well as a small portion of the principle. When applying for bad credit credit cards, you will want to obtain one with the lowest APR possible.

Credit Cards For Bad Credit – What Are The Fees?

Most cards charge an annual fee. This is true whether they are a “prime” card or a credit card for bad credit. It is not uncommon to pay an annual fee of $75-100 on one of the cards that are offered to people with bad credit. Typically, companies will always charge an annual fee. However if you are a customer in good standing and have been with them awhile they will waive this fee for you.

Enrollment fees are also common on these types of cards. They typically get added to the balance from the start so that a card you get is rarely starting with a $0 balance. These types of fees you will never see on a “prime” card. However for a credit card for bad credit you will rarely be able to avoid it.

Credit Cards For Bad Credit – What Is the Credit Limit?

Credit limits are just that. They are the maximum you are allowed to charge on your card. Usually a card of the type you will need will typically have a $300-$500 credit limit. However, some issuers can have as much as a $1000 credit limit. At this point in your credit repair efforts, having a low credit limit is actually a blessing. You will need to keep limits on your ability to go further into debt too much. High balances carry huge monthly minimum payments so a low credit limit is a blessing to those engaged in credit repair.

Credit Cards For Bad Credit – What Credit Bureaus Do They Report To?

The final thing you need to make sure of is what credit bureaus the credit card company reports to. You will need to make sure that all three credit bureaus (Experian, Equifax and Trans Union) receive regular monthly reports on your credit activity. As you pay off your cards and make monthly payments, the card company will report this information. In turn, this will raise your credit score over time. So making sure all three bureaus are reported to by the card issuer will help you immensely. 

You can help turn your credit around using credit cards for bad credit. Remember to use them responsibly, don’t run up the credit to the limit ( or over it) and pay your monthly payments on time (or pay them off completely) and you will go from having bad credit to good credit in no time.

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