Second Chance Credit Cards Will Help Rebuild Your Credit
Second Chance Credit Cards
Unsecured credit cards are particularly meant to help individuals who have a poor credit record. If you have a bad credit record, it’s significantly difficult to get authorization for top credit cards. Lenders and card issuers usually report all late or missed payments to Trans-Union, Equifax and Experian and such records are kept for up to seven years in United States.
When this situation is the case, issuers will decline your applications but the best thing to note is that there are bad credit credit cards. These cards don’t undergo the credit check rigors and are especially for clients with a poor credit history. However, terms and conditions are subject to change compared to normal credit cards. A lot of people still use low balance credit cards until they improve their credit record.
Credit Cards Will Help Improve Your Credit Rating
A poor credit record can affect you in many ways financially. It is therefore important that if you have a low credit score; you need to get the best second chance credit card to help you bounce back. Those with a good credit history enjoy low rates on what they borrow. So if you have a poor credit history you will be required to pay a higher interest rate for the same amount you borrow.
Improving your credit history is a difficult and time consuming activity but it comes with its advantages. If you are in debt a unsecured credit card will help you get financial assistance or even rebuild your credit record. If you apply for a credit card, you then need to re-evaluate your financial situation and make sure you don’t spend beyond your means. You should avoid getting into debt again by living within your means. There are numerous companies offering cards for credit challenged consumers today. You just need to decide which card suits you best.
Unsecured credit cards
These are meant for people who have a bad credit history; in general these cards have a lower credit limit value of about $250. The main reason for that credit limit is because the issuer is at risk of being left with a bad debt; should you fail to meet the agreement. You should note that your lender will report monthly to a credit check agency and you risk having your credit reviewed. Should you meet the terms of the contract your credit record will improve and you will be in a position to get better deals.
Secured credit cards
These are credit cards that require an asset or $200 cash deposit as the security. The lender entitles you to a small credit limit. Secured cards are much better compared to the unsecured cards, the terms and conditions are also different. You will be required to pay lower charges than in the unsecured cards.
Prepaid credit cards
These are credit cards that don’t engage credit checks or require any credit limit. Clients usually load them through bank transfer. After loading cash on your card you can then spend it normally. Cards that have a credit builder sign will prevent you from debt problems.
Second chance credit cards have helped people rebuild their credit in financial crises or even after bankruptcy.