What are bad credit, credit cards?
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Make no mistake: getting a bad credit, credit card will cost you. Many people today have run into financial problems and consequently ended up with a bad credit history (county court judgements and bankruptcy are two of the most common causes). However, there are also those who have defaulted on credit repayments and found themselves on financial blacklists. Naturally it's going to be more difficult for such people to get credit card (because they represent increased risk to the lender), but it's far from impossible.
In offering bad credit credit cards banks are clearly targeting the financially vulnerable, so it's important that they know exactly what they are letting themselves in for (often borrowers with poor credit histories will face steep APRs and little in the way of 'additional incentives'). However, bad credit credit cards do offer a way of rebuilding a borrower's financial reputation: if a customer is able to demonstrate financial responsibility by meeting monthly repayments they can expect to be offered a better card with a better rate. Conversely if they fail to meet the repayments their credit rating will receive a severe blow.
If you decide that a bad credit credit card is the right for you; you'll then have to turn your mind to choosing the right one for you. The first thing you'll notice is that all APR's are sky high. Suppliers are fully aware that the ball is in their court and the only way to avoid disappointment is to lower you expectations. However, before you sign up it's still important to read all the small print. Besides variations in the APR, you'll find that some financial institution levy annual charges (whereas others don't) or insist on a security deposit. Credit card companies also require a good deal of personal and professional information in order to process your application.
If you are in any doubt about the best way out of a financial predicament it's worth paying a visit to your local Citizen's Advice Bureau where you'll get free expert advice. You may also want to weigh up the pros and cons of taking out a personal loan, where interest rates can be as low as 6% APR (rather than a figure of close to 30% for a bad credit, credit card).
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