The majority of consumers seek easy to get credit cards when they have experienced credit difficulties in the past. Failing to comply with the terms and conditions of a credit agreement will be reported to Experian, Equifax, and TransUnion (the three leading credit reference agencies). A poor credit rating can make it more difficult to get a low credit score credit card, loan or home mortgage in the future.
The Terms of Easy to Get Credit Cards
A guaranteed approval credit card will typically enjoy less favorable terms because of the higher risk of the borrower defaulting. This will normally mean a higher interest rate, annual fees, and other miscellaneous charges. Bad credit history credit cards normally only have a low initial credit limit, although this can generally be increased once at least six repayments have been made on time.
Types of Bad Credit History Credit Cards
Secured credit cards. The customer uses their home, car or a cash deposit as collateral in return for a higher credit limit. It is very important to appreciate that failing to keep up with the monthly repayments will lead to that item being sold to recover their money.
Pre-paid credit cards. Money is loaded onto the card in return for a fee. Although there is no credit limit, it works in the same way as any other card. There is no credit reporting so it isn’t suitable for rebuilding credit. An excellent card for improving money management.
Unsecured bad credit cards. These cards typically have higher fees/charges in return for a small credit limit. A viable alternative for those who don’t wish to provide collateral.
A Guaranteed Approval Credit Card for Credit Repair
Although an easy to get credit card may not have the same terms as a mainstream card, it is possible to use it to rebuild credit. An instant decision credit card can be used to rebuild credit as each lender will report to credit reference agencies. The more payments that are made punctually, the higher the borrower’s score will become. This may mean that person will become eligible for a more competitive deal in the future.
Pros and Cons of Low Credit Score Credit Cards
Easy to get credit cards may not enjoy terms that are as competitive, but they offer a way to recover from a poor credit history. A secured credit card offers lower interest and charges because of the provision of collateral. Others may prefer a prepaid card, especially if they aren’t very good with money and want to avoid debt. The only real problem with a prepaid card is that it won’t help with credit repair. It is important to decide which factor is most important and whether any negatives make it a viable option.