Good Credit Cards for Bad
Credit - Learning The Possibilities
If people have
Credit, how do they
know which Good Credit Cards
to select when there are so many choices?
This article will break down a couple varieties
of cards to provide a helpful understanding
of the pros of each:
Cashback - With a Cashback
card, customers are offered a refund that is the same as
a percentage of their transactions. For instance,
if there is a Cashback
offer that gives five percent cash back
on supermarket, gasoline, and drugstore
purchases, as the cash back rewards add up they earn cash value. If you
use a hundred fifty dollars in gasoline, groceries,
and pharmacy items every week, at
the conclusion of a year, almost $400
in cash would have accumulated.
Redeemable Points - In lieu
of giving money back, some companies
offer redeemable rewards. Customers receive
points for making purchases. With each swipe of the card, the points
add up. After a certain amount of points add up they can be redeemed for all kinds of goodies including
free merchandise, gift items, magazines, and more.
It is smart to be aware of whether or not the Good Credit Cards
for Bad Credit you are considering offers
a points program.
Gasoline Bonuses - Credit card issuers
are often times understanding about the cost
of fuel and will reward
people for using their credit card by rewarding them with a prepaid
gasoline card. As the credit card is utilized, reward points add up. Once you have completed enough transactions to accumulate a certain amount of points they can be redeemed for a
free prepaid gasoline card. Sometimes, gas rewards can even be earned
while making fuel purchases.
Points Toward Free Hotel Stays, Rental Cars or Frequent Air Travel Miles - When purchases are made with this kind of card, redeemable points that can be cashed in for free travel miles are earned. Once enough points are accumulated, they can be applied toward all kinds of travel arrangements including free air travel. This kind of card is great for business travelers.
0% Promotions - Finance charges are not applied on these cards for a specified amount of time.
The promotional period generally spans six to twelve months.
Generally, people use this interest-free period
to move balances from their interest bearing Good Credit Cards
to one like this and pay the balances off within the promotional period. Making monthly payments on time is incredibly important.
When one payment is overdue, most times
zero percent APR rates are changed to a higher
rate. People that are approved for
Good Credit Cards for Bad
Credit, and have the opportunity to sign up for an interest free period
ought to consider this card.
Secured Cards to Re-establish Credit - People with a secured card
must put a few hundred to a few thousand dollars, depending on what they could afford, in a bank account that can generate interest.
This is what secures the account. At that point a card is
issued with a line of credit equal to
the opening balance of the interest bearing account that was created. Each time a transaction is approved your available credit is recalculated, low interest
regularly scheduled payments are determined, and a bill
is is mailed or emailed if you choose paperless billing. If the card is active you will receive a payment plan. Secured Cards to Re-establish Credit
are excellent because they operate like
regular credit cards allowing you
to do things that debit cards may not, like making travel arrangements such as vehicle rentals
that generally do not take check
cards. When applicants have bad credit approval is ordinarily
guaranteed despite your credit profile. However, keep in mind that many
secured card issuers report the way you pay your bill
to Experian, Equifax, and Trans Union. This can be a wonderful
approach to prove you are creditworthy by showing scheduled
payments no matter if you have Bad
credit or not. Once you have paid
six to twelve payments on or before their due date, some secured card companies will approve a higher limit without
requiring another deposit to the initial secured account.
Prepaid Credit Cards - With
a Prepaid card, purchases can be made without interest, fees, or finance charges. Just like
a typical bank account, a certain amount of money is deposited into an account and that becomes
the amount that can be spent. When the prepaid account
balance is used up, you can recharge it with an additional deposit. Reloadable prepaid cards
are excellent for financial planning, purchases can be tracked, and they are a great solution for those that cannot
obtain a typical checking account.
Quick approval is usually guaranteed despite
your FICO profile and there is
no need for the prepaid company to contact the credit bureaus.
With all of the different kinds
of Good Credit Cards
for Bad credit and
benefits that each of them offer, it is easy to identify the best solution for your situation. Seek
Good Credit Cards that offer rewards that match your lifestyle and spending style. Once you are approved be sure to
spend wisely and pay the bill on or before the due date. Superb credit is an awesome
thing to have.
To ensure that you keep developing the best credit score, obey these three rules:
1. Keep your bill lower than the
credit max. Simply put, don't
"over spend". Make sure to keep
a balance that is about fifty percent
of the limit on any
Good Credit Cards for Bad Credit.
2. Make the monthly payments by the due date. Even if you cannot make more than the minimum payment due, that's ok. If you miss a payment, that information will be reported to the credit reporting agencies. This could bring down your FICO score. Unfortunately, when this happens you may also be assessed a higher interest rate as a result of a single tardy payment. Therefore it is recommended that consumers stay on top of the bill.
3. Pay the balance completely every so often.
When you make purchases, try to
pay it all off at least once a year. After the bill has been paid down to zero it is wise to
start swiping your card for purchases again and take a few months to pay the balance off again, and don't stop this habit.
This cycle confirms to the issuers
that you will be a great customer. You could also be rewarded with
lower rates, higher credit limits, and a higher FICO score.
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