Is There Something Called a Bad Credit Credit Card?
Is there something out there called
a bad credit credit card? Well, when a bank or Credit
company such as Bank of America, Washington Mutual
or Chase receive an application from you, they use
a statistical system to determine whether or not to
grant credit to you by assigning numerical scores
to various characteristics related to creditworthiness.
This means the creditor's measure of your past and
future ability and willingness to repay your debts.
This system is based on your credit history, which
is a record of how you have borrowed and repaid debts.
If this record shows late payments, skipping payments,
exceeding card limits or declaring bankruptcy you
are considered a person with "bad credit".
Then you're condemned, you're hopeless..
Nobody will ever lend you money or give you a credit
card anymore, you may think but then you should think
again. Even people with horrible credit histories
who have been in a financial mess because of previous
debt can get credit card offers. So, the answer to
the question I asked in the beginning of this article
is "Yes": You can get a secured or prepaid credit
card.
Banks and other credit companies need
customers, even thoses in a bad financial situation.
So these secured or prepaid cards offers are specifically
targeted to help people with poor credit, so that
they too can have all the benefits that follows such
a card.
What distinguise a secured card from
an unsecured is that the card's account is usually
related to a savings account. This is the way the
card is secured. Let's say you have $1,000 in your
account, then your credit limit will be $1,000. With
this build in security, you will never be brought
into a debt situation again. After using this card
for a while, most banks or finance companies will
gradually grant you credit that exceeds your saving
account balance and you will at the same time repair
your credit history. This bad credit credit card is
a great offer, that you should take advantage of if
you have a messy financial history and want to rebuild
your credit.
Terje Brooks Ellingsen is a writer and
internet publisher. He runs the website 1st-In-Loa
n.net Terje gives advice and helps people with
personal financial issues like consolidat
ion loan and how to apply
onli ne for credit cards
