How To Secure A Credit Card Even If You Have A Poor Credit Rating
You should be aware of the effect of credit score on your ability to get a credit card. Your credit history is the basis for the decision by the bank. If you have a negative credit history, it is very unlikely that you will be given a credit card.
This is because your credit history and score indicate how much of a risk you are to lend money to. A credit card is a loan. You are borrowing money from a bank and paying back with interest. Someone with bad credit is a poor risk, and will likely have a very high interest rate.
Poor credit ratings will also mean that you don’t have much of a credit line. You’ll have a lower spending limit than would someone who has good credit.
If this sounds like you, and you have a bad credit history, you will probably want to start with a secured card. Be sure to take out any protection offered by the issuer also.
You will have a credit card with a certain limit, but the risk to the issuer is limited because it is secured. This means you are required to keep an account with a certain amount of money in it. Generally, you have to have an amount equal to or even more than your credit limit on the secured card. The amount you are required to keep in the account will vary based on the policies of the issuer.
Another option for you if you have poor credit is to take out a joint credit account. If you have a family member who has good credit and is willing to do this, you may be in luck.
The card rate will be better than normal because the other person’s good record reduces risk. Both of you are liable for repaying the money borrowed, and the lender trusts that the other party will pay even if you won’t. You want to make sure though not to take advantage of this; never carry a balance so large you can’t make the payments.
You may also have to pay a fee. There are even some cards that have an annual fee, or nominal amount you pay for the privilege of having the card. Don’t just jump to take a credit card even if you are accepted though. Be sure to read all of the terms and conditions.
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