One question you might have asked yourself if you were ever in this situation is ‘are credit cards for people with bad credit even possible?’ Even though it sounds like a bit of an oxymoron, as it turns out, yes. Bad credit is typically viewed as the number one deterrent to getting a loan or being issued a credit card. Still, there are some credit cards which you can get. Let’s explore them!
What Is the Problem with Bad Credit Score?
First of all, it has the word ‘bad’ in it, which should give you a clue as per the answer. On a more serious note, one can develop a bad credit score or a bad credit history when he or she has had problems in paying installments in the past.
The failure in keeping up with your contractual obligations which has resulted in late payments or amassing high debt ultimately leads to a bad credit score. This goes into your file, which will be shared among all the banks and financial institutions you go to if you want another loan or a credit card. In laymen’s terms, they look at your file, see your bad credit score, and they deny you said loans. Why? Because the banks consider that, if you haven’t been able to meet your monthly installments in the past, you won’t be able to in the present either. Therefore, you are a liability or too much of a risk for the bank to assume so that they can give you money.
A word of caution here – even though we’ve only mentioned being late to pay other credits, there are some financial institutions which take other criteria in consideration as well. For example, they can also check if you paid your rent, bills, and fines on time in the past. If not, this can lower your credit score even more, and those credit cards for people with bad credit will slip further away from your grasp.
What Are the Best Credit Cards for People with Bad Credit?
Online reviews, as well as financial analysts, have a list of credit cards for people with bad credits. Here they are.
#1. The Credit One Bank Unsecured Visa Credit Card
This one is a fully functional, albeit unsecured credit. It’s not a debit, secured nor prepaid, as are other types of credit cards for people with bad credit. These features mean you don’t have to put down any deposit before you can get it and that you don’t have to add a deposit in cash.
Every time you will use this credit card for buying gas or groceries, the issuer will give you back 1% in cash. Apart from that, they also allow flexible payment dates, so that they can help you as much as possible to pay your monthly installments. When you have amounted enough payments on time, you will be able to secure an increase in your credit card line.
#2. The Milestone Gold MasterCard
Another great entry on our list of credit cards for people with bad credit is the Milestone Gold MasterCard. It’s unsecured and offers a very short pre-qualification process. To put it simply, that means your credit report will not be inquired on a very deep level. The credit card also comes with easy access to your private account via the internet and design options of your choice.
On top of all these things, the credit card’s best asset is that you can still get it, even though there is evidence of bankruptcy in your past. If you can prove that you are able to handle credit responsibly now, they will give you access.
The Milestone Gold MasterCard is beneficial as credit cards for people with bad credits go, seeing as it can be used in a whopping 35 million locations throughout the world. Apart from that, the issuer provides protection against bankruptcy, should the card get lost or stolen.
#3. The Indigo Platinum MasterCard
The third entry featured on our list of credit cards for people with bad credits is The Indigo Platinum. The issuer accepts people with bankruptcy problems in the past and allows you to pre-qualify without impact to your credit score. The moment you qualify for this credit card, you will be granted access to all their online tools to help you manage your account, and to their zero liability policy on any fraudulent shopping done via your credit card.
#4. The Total Visa Unsecured Credit Card
This final option we present you on the list of best credit cards for people with bad credit is issued by Mid America Bank & Trust Company. They have a license from Visa USA Inc. Mid America Bank & Trust Company; Member FDIC.
We placed this one at the bottom of the list because, even though it’s still a good way to go, it has fewer benefits for the applicant. For example, it doesn’t offer any kind of rewards, like The Credit One Bank Unsecured Visa Credit Card. However, it still comes after a fast or, sometimes, an immediate response from the issuer, which is excellent for a person in dire need of money.
If and when you get approved, you will need to pay a processing fee that will open up your account and allow you to start transacting on the spot. The monthly payments are manageable to suit your expenses, and the application is straightforward and speedy.
The card in itself is an original Visa, which means it will be accepted anywhere in the United States and online.
As a bonus, we have compiled a few tips for you to consider before you apply. Even though these are credits cards for people with bad credits, you still need to do some research before you jump in, just to make sure you found the best choice.
- Start off by knowing your credit score. Even though these credit cards don’t take in into account that much, it’s still good to know where you’re standing.
- If at all possible, try to improve said credit score. You can do that by paying off any late bills or tickets you have. Some financial institutions might even agree to wipe off your bad history with them, as long as you can prove you were not the one to blame.
- Think very well about your needs. How much money do you need? What are you going to use it for? How much of it can you pay back and how? All these questions will help you decide if you need a credit card or a short-term loan.
- Never apply for travel cards, cash-back cards, and best rewards cards.
- If you think or notice you are falling behind, a prepaid debit card might be the solution for you.