How to Get a Credit Card with Bad Credit
Don’t fret if you have bad credit, there’s still hope!
Laura Adams, MBA
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Q. How can I get a credit card if I have bad credit?
Answer. Having poor credit isn’t good for your personal finances, but it’s not the end of the world. Whether your credit has taken a hit due to a job loss, excessive medical debt, or poor money management, you always have the opportunity to raise your credit over time. Getting a credit card before your credit improves may be more challenging, but it isn’t impossible! Try out these four tips:
- Apply for a credit card at your bank or credit union. If you’ve established a relationship there, they may be willing to extend you credit.
- Add a statement to your credit reports at each of the three major bureaus–Experian, Equifax, and TransUnion–explaining each of your negative items. Companies that pull your report may be swayed by your honesty, especially if the circumstances were out of your control (such as a medical debt or divorce).
- Apply for a secured credit card that allows you to make a deposit that serves as your credit limit. Make sure the card company reports your transactions to the credit bureaus so you can build credit and graduate to a regular, unsecured card.
- Apply for a subprime credit card–but only as a last resort! These cards charge very high interest rates and fees, so you should always pay them off in full and on time each month. Responsible use of a subprime card can boost your credit and help you qualify for a less costly card.
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Credit Cards image from Shutterstock
About the Author
Laura Adams received an MBA from the University of Florida. She’s an award-winning personal finance author, speaker, and consumer advocate who is a frequent, trusted source for the national media. Money-Smart Solopreneur: A Personal Finance System for Freelancers, Entrepreneurs, and Side-Hustlers is her newest title. Laura’s previous book, Debt-Free Blueprint: How to Get Out of Debt and Build a Financial Life You Love, was an Amazon #1 New Release. Do you have a money question? Call the Money Girl listener line at 302-364-0308. Your question could be featured on the show.