It can be difficult to get approved for credit cards if your credit score isn’t high enough. You can also hurt your credit score if you are rejected for a credit card application. Those with poor credit have many options to get credit. We have compiled a list of top cards for “subprime borrowers” as well as a guide to help you get approved for a secured credit card or unsecured card, despite your poor credit.
If you have poor credit and are looking for a credit card, you typically have two options: either a secured credit card where you make a security deposit equaling the amount of credit you want or an unsecured credit card that is designed for people with bad credit.
Types of Credit Cards For Bad Credit With a $1,000 Limit
Although you might not be able to get large credit limits due to bad credit, this doesn’t mean that you can’t manage your finances with a credit card. Here are two credit cards that people with poor credit can apply for and be accepted for:
Secured Credit Cards With Guaranteed Approval
Secured credit cards are, as the name implies, approved after the person makes a security deposit as a condition for the credit card. Secure credit cards are a way to get out of trouble if you can’t pay the card’s monthly payments due to the credit card issuer taking a risk by approving it. The deposit can be redeemed so you don’t need to worry about how to get it back. The interest rates are comparable to credit card rates and there are no additional charges.
Unsecured Credit Cards for Poor Credit
If you apply for an unsecured card, your credit card request will be approved without the need to make a security deposit. As a customer, you do not need to provide collateral in the form of money you could lose if you miss payments. The credit card issuer, on the other hand, balances the risks by charging higher interest rates and more fees than usual. You must still have a minimum credit score to be eligible for this type of credit card.
How to get a guaranteed approval credit card with a $1000 limit for bad credit?
Here are some eligibility factors to consider if you want to increase your chances of getting guaranteed approval credit cards with $1000 limits for bad credit.
Previous bank statements
Although a hard credit check doesn’t have to be done, the issuer will most likely review your bank statements in order to assess your financial management.
The issuer will assess your ability to repay the credit card limit each billing cycle based on your net income or debt-to-income ratio. The chances of approval increase with higher repayment capacity.
Stable income is not only important for approval but it is also a requirement. The issuer will know your monthly, sustainable income and whether or not it is sufficient to repay your monthly credit card debt.
A percentage of the amount must be paid in advance to assure the credit card issuer that you are ready to pay. This can greatly increase your chances of approval.
What are the Factors to Consider when Comparing Credit Card Offers?
There are hundreds of credit card companies in your local area. Before you make the final decision, consider these factors. These are not only important for obvious benefits like offers and deals, but they also have a lot of other considerations.
Credit Bureaus Association
Credit bureau affiliation can help build your credit history. If the credit card that you are considering applying for doesn’t have an affiliation with a national credit bureau then consider another option.
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Although it’s not mandatory, it is a good choice to have free access to your credit score. You can track your credit score and improve it, as well as manage your finances.
Rates and charges
High-acceptance credit cards and unsecure credit cards have higher annual rates and interest charges. You’ll end up paying a lot more if you make a smart decision. The interest rate offered to you will also be affected by your credit score.
Credit Card Upgrade
Ask your credit card issuer if there are any upgrade opportunities. With better credit management, you may be able to get better credit cards plans and an increase in your credit limit.
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Bad credit can still be obtained with a credit card. This can help you build your credit score. There are not all credit cards that are suitable for people with poor credit. Your financial goals and personal financial history will play a key role in choosing the right card. Be aware of high interest rates, high fees and low credit limits. This will keep your credit utilization high while keeping your credit score low.