How to apply for a credit card if you have bad credit in 4 simple steps
How to apply for a credit card with bad credit?
Step 1: How Bad Is Your Credit?
Check your credit score through Discover Bank, Capital One Credit Wise, Credit Karma or another free credit score service.
You can also get a full credit report for free once a year at annualcreditreport.com.
Step 2: Decide on a Secured or Unsecured Card Option
The primary difference between the two, is that secured cards require security deposits of at least $250, that the card issuer holds in case you default on the account.
Action 1: Try an unsecured card first. Cards with prequalification are a good option. If you are approved – great!
Action 2: If you are not approved, apply for a secured credit card. Now use your card, make your payments on time, build your credit score, and work toward improving your score to graduate to an unsecured card in the near future.
Action 3: If you are not approved for a secured credit card, your only option is to use a prepaid card. Prepaid card won’t help you improve your credit, so it’s important that you work on getting a secured credit card and improving your credit.
Step 3: Use Your Credit Responsibly and Rebuild Your Credit
Monitor your score. [make sure you continuously monitor your score to see where you need to improve or make corrections.]
Keep your utilization low. [keep your total amount due at 30% or below your total available credit, do not max out your credit line]
Pay on time. [Making timely payments is one of the most important parts of a good credit score.]
Ask for credit line increases. [Ask your card issuer if this is an option. Also, don’t be afraid to ask when and if graduating to an unsecured credit card.]
Step 4: Get a Card for Average or Fair Credit
In about 12 months your credit should be in 650 FICO range and will be ready to get a credit card for fair credit with higher limits and better terms.