Having bad credit, or at least less than good credit, can make it hard to get the money you need to do what you want. People get bad credit in part because they use their credit cards' "charge it" feature too much. Here's how a credit card, at least a certain kind, can help you fix your credit.
Even though having a credit card can help you build credit, you probably already know that you won't be able to get the best rates or features when you get a new one. Most of the time, the terms will be strict and your rates will be higher. It also means that any credit limits you get will be low, at least at first, because the credit card company will see you as a higher risk than someone with good credit.
The first thing you need to do is make sure that the credit card company you are applying to says that it reports to a major credit bureau. It may report to all three of the big ones, Experian, Equifax, and TransUnion. Look for it. Look for another card if it doesn't report to at least one of these. Even if you make every payment on time, it won't help you fix your credit.
The next thing to look at is the interest rate. You'll want to get a loan with a very low interest rate—the lower, the better. This is the interest rate you will pay each month on the credit card balance, no matter how much you owe. You should try to pay off the whole amount every month. This will help you build your credit score more quickly.
Check out the different fees that are charged. You might be surprised to find out how many there are. Almost everything costs money. They want to show that they are willing to take a risk by giving you a credit card, but that you will have to pay for the privilege. The good news is that if you use the new card well and take care of your money, you will get offers for better cards over time. Since there are so many fees, you don't want to just take any card. Instead, you should compare them to see which one has the least fees. When all of your fees are taken into account at the beginning, there won't be much room for anything else.
Most credit cards for people with bad credit don't have the perks that come with a regular card when you first get it. There will also be no discounts or rewards. Some of these cards might let you move money from one to another.
Make sure to check the application to see if there is a time frame that says how often the credit card company will look at your account. This is important because you can only get the chance to get a better card at that time. At these reviews, the company that gave you the card could decide to raise your credit limit, lower your fees, or do something else like that. Even though you'll have to pay more at first, getting a credit card for people with bad credit is a good idea because your credit score will improve quickly and you'll get better deals.
