Unsecured Credit Cards With Bad Credit: How Fast Can You Get One?
There are several steps if you want to get an unsecured credit card with bad credit, and the application process is no different. For most of us, the problem of low credit scores is a recent one. We are not legacy entitled to previous bad times and so credit cards only made sense.
This, however, led to a reaction of applying for lots of cards and effectively having as many applications as possible rejected. This meant a wasted time and a worse reaction to should we get approved. It can be tricky if you do this to yourself, because it means you apply for and then subsequently get declined. However, there are two steps you can take to make things easier:
The selection of cards
In general terms, the most popular cards available are the secured and unsecured ones. So these are the ones to seek for an unsecured card with bad credit. Yet the initial fact is that, if you own your home then this opens up the whole range of options open to you. You can get a card with a lower interest rate to enjoy lower repayments and more benefits. If you own a home then it is much easier to get certain cards.
If not then you will need an unsecured card with bad credit that is aimed at those with no or very few sources of income. But this will still vary a lot depending on your credit score.
So even with a low credit score, it is possible to apply for a card if you know how to do it. Secured cards will require you to either pay a deposit or open to a savings account to guarantee the credit line. Their terms of agreement is not good when compared with a regular card because you are not actually given the money, but your account will be closed down if you fall behind in repayments.
Unsecured cards on the other hand do not charge any for the right to use them, and give a smaller credit line. Still, all of them will report to the credit reference agencies, thereby helping to improve your credit score, albeit in a slow way.
It is feasible to get a card within six months, but interest rates can vary quite a lot between lenders.
As already explained, there is a difference between secured and unsecured cards. Secured cards can be used with relative ease and come with a number of advantages. As is obvious, unsecured cards are very difficult to get approved for, but more difficult to get an unsecured card with bad credit. This is because they do not have any security, and are very high risk.
For personal credit purposes, unsecured cards are better than the no-secured ones, but both can be used constructively.
An unsecured card is ideal if you have a primary card (one with a small line of credit), which you use quite a lot, and have a record of having repaid on time. Use the card as needed, but ensure that the repayments are made. Then, as that card is used for a while and is repaid, your credit score will increase – which is the aim of all credit improving measures. This will help you borrow more money on a later card.
After a while, and as the card is repaid, a fully paid up unsecured card can be considered. Even if the limit on an unsecured card is relatively low, for example $250,000, it is still possible to have access to some credit. But beyond a point, say $50,000, most lenders will not be willing to lend to you.
If you have achieved that, then hopefully you will have earned your credit score and can apply for a fully processed unsecured card. Do not apply for “small stuff” – major bank cards, or a retail or department store card. These are riskier for lenders.
It is a lot easier to be rejected for a card, if you are rejected for one. This is irrespective of whether you have good or bad credit. However, you can avoid being declined if you follow these steps.