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Things To Know About Bad Credit Credit CardsBad credit credit cards can be very attractive, but there are a few things you should know before you obtain one. We will analyse a bad credit credit card so that you know what to look for. The first things we will look at are the advantages.
Of the above some things can change. Some of the bad credit credit cards will not offer the rewards programs because you are seen as a risk. The major advantage to the card is being able to repair your credit score and history. By using the card for a purchase every month, even as small as a 3 pound purchase you can up your credit score. This works if you pay the balance off in full and on time. It shows the company that you are in good standing and the longer you are in good standing with the card the more your score will rise. The score rises as your history improves, which means you need the good standing to be reflected. By using the card for purchases that you can’t pay off you are going to get in more debt. This is one disadvantage.
First a bad credit credit card has very high interest. It can be higher than the 18.9 percent. In fact some cards offer 54 percent on a credit card for bad credit. As we mentioned above if you pay off the purchases you make you can save yourself the interest, but if you don’t you will incur a higher debt than you had before. There are restrictions on whether you can get the card. Some individuals with really bad credit may still be turned down. The point of the card is to make it easier for you to get credit when you have been declined by other companies, but this doesn’t mean you are guaranteed acceptance. Most of the cards for bad credit don’t give you an incentive to spend. They don’t want you to spend your money on things that you can’t afford. This means they don’t offer rewards so that you won’t be tempted. The universal default is on most cards. It means the company can increase your credit interest rate at their will when things change in your credit score. If your score lowers instead of increases you could have an even higher rate than you started out having. The credit cards for bad credit should be used wisely so that the advantages work for you and you don’t get caught up in the disadvantages. There are certainly plenty of ways to make the card work for you so that you can get a better mortgage, loan or credit card in the future. Back To Financial News May 2008 Are air miles credit cards right for you? |
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