Credit cards are bad

The 6 Worst Credit Cards For People With Bad Credit

If you have a FICO score of lower than 600, you are considered to be someone with bad credit. One way to rebuild your credit is by getting a credit card and using it wisely. Knowing this, various credit card providers offer cards designed specifically for people with bad credit. While most of these cards come with high fees, interest rates, or restrictions, some are still recognizably better than others. Instead of helping people to rebuild their financial lives, some cards do more harm than good by charging exorbitant interest rates and hidden fees. See the following list of the worst offenders.

On its website, First Premier Bank clearly shows who it is marketing its credit cards to with this line over its link to credit card offers: “Less than perfect credit?” Upon examining the “Fees, Rates, Costs, and Limitations” page for the basic unsecured Premier Bank MasterCard, the first thing that stands out is the APR: 36 percent! On top of that, it comes with a one-time $95 processing fee and a $75 annual fee that is immediately assessed against the card’s credit limit – taking the meager $300 limit down to $225 before you have even bought anything. After the first year, the annual fee drops down to $45. On top of these fees, there is a monthly “servicing fee” of $6.25. (Thankfully, this does not apply for the first year.) Cash advances each cost $6 or 5 percent - whichever is the greater of the two. The card also charges a $35 penalty for every late payment and $35 for returning items you have purchased with the card.

The Centennial Secured MasterCard is also provided by First Premier Bank. As the name implies, it is a secured card – meaning that applicants must initially submit a security deposit. If the card holder later fails to make payments on the card, the provider may keep the security deposit. This card comes with an APR of 19.9 percent and an annual fee of $50. This annual fee is taken out of the initial credit limit, which is based on the security deposit. Therefore, by paying the minimum security deposit of $200, after the $50 annual fee has been taken out, you get an initial credit limit of $150. Like the unsecured First Premier Bank MasterCard, this card charges the greater of $6 or 5 percent for cash advances and levies $35 penalties for late payments and returned items.

Net First Platinum Merchandise Card

The Net First Platinum Merchandise Card purports to be a credit card with no credit check and guaranteed approval. It offers a $500 line of credit. However, it cannot be compared to other credit cards for two reasons. First, it can only be used to make online purchases at thehorizonoutlet.com, making it useless for those who want a credit card they can use at most stores. Second, while it does extend a line of unsecured credit, it does not report to the major credit bureaus. The Net First site explicitly says that Horizon Card Services – the provider of the card – is not a credit services or banking organization and that the card does not work through a major credit card company. Those who use it often complain of hidden fees and say that it is difficult to get rid of.

Many retailers offer credit cards specifically for use at their stores. They may offer special perks such as discounts on specific products, but in general, such cards are some of the worst in the industry. The Shack Card from Radio Shack has notoriously high interest rates – varying 26.99 to 28.99 percent in normal situations and going up to 29.99 percent as a penalty rate. To be fair, Radio Shack does offer zero interest for the first six months if you make a minimum purchase of $150. The card also gives you a 15 percent discount on in-store battery purchases.

Office supply store Staples also offers an in-store credit card. The interest rate for this card is about the same as that of the Shack Card at a variable 27.99 percent. Like the Shack Card, this card does come with a number of benefits for the frequent Staples shopper, such as free delivery on all orders and automatic enrollment in the Staples Rewards program. This program allows you to receive a number of discounts – such as a 10 percent discount on toner and printer/copier-related purchases. However, it is difficult to pay attention to these benefits with that interest rate hanging over them. Unlike the Shack Card, the Staples Card does not offer an introductory zero-interest period.

The Black Card is a Visa card marketed as an exclusive credit tool for those who spend a lot on luxury items. One way by which the Black Card maintains its supposed exclusivity is with its annual fee of $495. No, that is not the line of credit. That is the annual fee. To this, add an annual fee of $195 for each additional authorized user added to the account. However, despite the card’s claims of exclusivity, consumer reports have found that it is not all that exclusive. It is marketed to the general public, and people with poor credit and even low income sometimes get the card because they see it as a status symbol. It does come with a 0 percent introductory APR which is attractive. However, after the introductory term ends, the APR shoots up to 14.99 percent. If you miss a payment, the penalty APR is 30.24 percent.

If you are trying to rebuild your credit score, stay away from these credit cards. They could end up doing more harm than good to your credit profile.


Credit Cards for People with Bad Credit

April 1, 2011 by Sarah, BSN, RN

Bad credit credit cards–are there really credit cards for people with bad credit? It can be tough for those with bad credit. Situations out of control can arise that may ruin a person’s credit for many years to come. Whatever the situation, there are solutions to help rebuild creditworthiness. There are credit card companies that believe in offering a second chance to those who end up in these sticky situations. Conduct a little research to determine which credit card offers the best benefits.

Many companies defraud customers out a great deal of money in order to receive a credit card. Make sure that the rates and fees are determined before applying for the card. Having bad credit does not make it necessary to settle for unfair credit card rates. The following are tips to prevent credit card scams:

Potential cardholders must consider that fees for late payments and charging over the limit, as well as annual fees and interest rates for using the credit card. Expensive fees can decrease the amount of available money to spend.

· Avoid Low Introductory Rates That Change

Low rates usually last for a few months and the new rate increases to the maximum allowed by law. Bad credit credit cards may have hidden charges with many restrictions for using the card.

· Apply For Cards That Report to Credit Agencies

Credit cards that report payment or credit history to credit agencies help to rebuild credit. Those that do not report to these agencies can do nothing to restore creditworthiness.

· Apply for Cards That Allow Account Upgrades

Non-secured credit cards are the ones in which those with bad credit usually do not qualify. Paying on time may allow an account upgrade. After a year, many are allowed to upgrade to a non-secured credit card. Make sure the credit card companies offer this option so payment information can be reported to credit agencies.

How to Get Approved for a Credit Card with Bad Credit

There are several options for credit cards for those with bad credit. Credit card companies may or may not look at credit scores unless applying for an unsecured credit card. If approval is denied, alternative options are available. The following offer ways to get approved for credit cards for people with bad credit:

· Apply for an Unsecured Credit Card

Unsecured credit cards are the traditional credit cards. Credit score is the main determining factor in approval. If denied, add a 100-word statement to each credit report explaining the situation that led to late payments or default. Credit issuers are supposed to consider this information when pulling credit. Creditors are usually considerate if illness or divorce led to payment issues. Bad credit does not necessarily prevent issuance of this card.

· Apply for a Prepaid Credit Card

Those with bad credit cannot be denied this option. Money is added to a prepaid credit card and customers can spend it just like money. There are no annual fees or interest rates. Cardholders can only spend the amount of money placed on the card. There may be a small fee to activate the card but no others. The only downside to this card is that the payment history is not reported to credit agencies.

· Apply for a Subprime Credit Card

This is a very costly option. Potential cardholders are approved for this card based on the ability to pay upfront costs. The processing fees may not be worth receiving the card. Laws prevent credit card companies from charging more than 25% of the card limit in upfront fees. Credit card companies may raise fees after the first year to limit risks. Some companies charge over 70% APR.

· Apply for a Secured Credit Card

Approval of a secured credit card depends of the potential cardholder’s ability to pay a security deposit, usually between $300 and $500. The payment history is reported to the credit agencies so the cardholder’s credit can increase with timely payments.

Many debit cards double as credit cards. Credit does play a factor in approval, but the cardholder’s credit usually does not have to be as high as it needs to be to apply for a traditional credit card. The card spends just like a credit card, but the cardholder must pay expensive fees for over limit charges.

Best Way to Apply for Credit Cards with Bad Credit

  • Do not apply for too many credit cards that pull credit. Even if approved too many inquiries can lower credit scores.
  • Search online for the credit cards with the best rates and low fees.
  • Stick with credit card companies that have good reputations.
  • Apply for cards that can help rebuild creditworthiness.

There are quite a few options to choose from for credit cards for people with bad credit. Having bad credit does not mean the end. These credit cards can help cardholders rebuild credit and self-confidence. Potential cardholders do not have to settle for less due to bad credit.


credit cards are bad

Credit cards are bad

Volunteer Budget Counselor

Click HERE for more information.

Here on my web site, as well as in my financial counseling sessions, I am consistently stating that the use of credit cards is not a good idea. Notice that I didn't say that using credit cards was wrong --I simply said that it is a bad idea. So, to answer the question, using credit cards is not wrong, it's just a bad idea. Now that that's settled, let's talk about why credit cards are a bad idea.

The borrower is slave to the lender.

Change the rules.

Your rules say to stop borrowing money, get the credit cards paid off completely, become totally debt-free and start using your money to build wealth for you instead of for them. To accomplish this, you need savings and you need a plan.

"You have no money so you use credit, and then

you pay your credit and you have no money because you're paying the credit. "

Bill Keenan, Average Joe Money Show podcast

Please know that all of the thoughts, information, suggestions and techniques given on this site are nothing more than the author's opinion on the matter being addressed. Do further research before making any decisions.

This article copyright © 2007 by Keith C. Rawlinson (Eclecticsite.com). All rights reserved.

This article may be copied for non-profit use including newsletters, bulletins, etc. as long as you

first get written permission from the author and full credit is given which includes the author's name


4 Types of Credit Cards for Bad Credit

Credit cards are bad

Whether applying for a credit card, a bank loan, a mortgage or line of credit, financial institutions will first review an individuals’ credit history to determine if they are eligible to borrow the necessary funds. A credit history reflects a borrower’s previous ability to consistently pay back the money they have been loaned, overtime.

In the instance that a borrower has been able to continue to pay back at least the minimum balance of the loan without missing a scheduled payment, then they are considered to have good credit history. If a payment has been missed or is late, then this means a borrower will receive a bad credit history. If an individual is deemed to have bad credit, financial institutions will be less likely to provide them with any future loans and refuse them when applying for a new credit card. With an improvement in credit scores, will allow a borrower to be more likely to secure a loan.

Borrowers who are experiencing credit debt will need to execute a plan to begin paying back the loans and increasing their credit score. Assistance for getting out of credit debt as well as credit cards for those with poor credit is offered through many financial institutions. Some of the credit cards for bad credit that are available include, Secured Credit Cards, Pre-paid Cards, and Low Interest Credit Cards.

This credit card can be useful for any individual who has very a minimal personal credit history due to major life events, such as a divorce or even bankruptcy. Despite being rejected for credit card options, applicants with poor credit are guaranteed card approval and do not have to undergo the embarrassment of being subjected to a intensive credit check.

The process for applying can be easily done so over the phone or online. Prior to issuing the card, the borrower is required to deposit a fixed amount into a special account in order to guarantee that they have the means of repaying the given credit amount. This feature benefits the card user by making sure they do not overspend and the development of habitual money management skills.

When considering if this card is the right choice, borrowers will also want to be aware that these cards often come with a higher interest rate, additional fees, and offer lower credit limits. Applicants are unable to challenge these stipulations, because they are restricted in the range of credit card options they have access to and it is important to decide if the positive features of the card out way the steeper fees.


Bad Credit Loans We Can Help When Others Can't

Bad credit is a problem that plagues millions of Americans. To many individuals, their credit rating may just be an arbitrary number that sums up their financial standing, but in reality it is an important number that speaks to an individual’s financial health. A bad credit rating can prevent people from getting the financial help they need. Lenders aren’t going to give their money to people with a poor credit rating for fear that they will never see that money again, yet those with poor credit are often the ones most in need of money to help solve or avert financial problems.

When You Need a Line of Credit

When individuals are facing financial challenges, it becomes difficult to overcome these hurdles without cash. Unfortunately, those with bad credit are almost universally denied loans by banks and other traditional lending institutions. They usually have access, however to credit cards, which are both a source of financial strength and a potential financial pitfall. With fewer retail and other businesses accepting checks these days, credit cards are a must for any individual wishing to pay for goods and services. What options are there, though, for those with bad credit?

There are actually a wide range of bad credit credit cards available to help individuals with poor or no credit pay for goods and services. The purpose of any bad credit credit card is to allow individuals the access to credit they need without risking further damage to their credit rating or debt they cannot handle.

Credit Cards Designed Specifically for Your Situation

Most credit cards are only available to those with good credit, leaving those with bad credit out in the cold. However, a bad credit credit card is available regardless of an individual’s credit standing. The credit card request process is quick and easy. To get the credit card request process started individuals need only provide the following information:

Once a request process has been started individuals will need to choose between the various types of bad credit credit cards. There are several different types of these cards available, and the type that an individual chooses to obtain will depend upon just how fragile their financial standing is. The typical options for bad credit credit cards include the following:

Not every type of bad credit credit card will be a good option for every individual. A brief look at these three main types of cards should help any individual determine which card can help for their financial situation.

A prepaid credit card is exactly what it sounds like. Individuals deposit a set amount of funds directly onto their card and are free to spend with the card just like any other card. However, the card is no longer usable once the individual uses up all the money on the card. This type of card may help those trying to build a credit rating, as not everyone has cash in hand to deposit onto a card to begin with. Prepaid card users should be aware though that these cards often carry high fees, so it is important to spend wisely.

Secured credit cards are often issued by banks or credit unions and require individuals to open an account with the institution and deposit funds in the account. These funds are held as an insurance of sorts by the bank in the event that bills cannot be paid. Just like prepaid cards, secured cards carry high fees as well.

Debit cards work differently than both of these. In order for a debit card to work individuals must already have funds in the checking account attached to the card. When a purchase is made the money is drawn immediately from the account. These cards are also good for those with bad or no credit because it limits their spending to the money they currently have.

You Can Get the Help You’re Looking For

Bad credit credit cards are issued by all the major credit card companies across the world, such as Visa, MasterCard and Discover, and they can be used just like any other credit card. Most of the companies report to credit bureaus on a monthly basis, meaning those with bad credit or no credit can swiftly repair their credit rating while working their way out of debt with a bad credit credit card.