Do you need to rebuild bad credit? If you do, then you may consider applying for a bad credit credit card that is suited to your needs. The most popular credit cards for bad credit are secured credit credit cards. Secured cards require the submission of a cash deposit which acts as guarantee for repayment. However, if you can’t afford to provide a security deposit, you may look for an unsecured credit card for bad credit.

Can you really find an unsecured bad credit credit card in the market? The answer is yes and in fact, unsecured cards for bad credit also come in different categories. For instance, you can apply for a merchandise card or catalog card that offers guaranteed approval. What are the benefits of merchandise cards? Consider this list:

Guaranteed Approval. As mentioned above, you can look for merchandise credit cards that offer approval for all types of credit – bad credit or no credit history. This way, you can be sure that your application will not be declined, saving your credit score from further damage.

Large unsecured credit line. Catalog cards are unsecured bad credit credit cards. This means you do not need to submit any amount of cash security deposit to open an account. Despite your poor credit score or having no credit history, you can enjoy a generously large credit limit which can range from $5,000 up to $10,000.

Purchase merchandise you need. As the name implies merchandise credit cards allow you to make purchases from the issuer’s catalog. Take note that this type of bad credit credit card can be used exclusively with a specific merchant. You can’t use it to buy from any shop or establishment as you would a regular credit card.

Build bad credit. Aside from granting quick approval and large unsecured credit lines, merchandise credit cards can help you in rebuilding your credit score. Just be sure to look for an issuer that reports to the major credit bureaus. By using a merchandise credit card to buy merchandise that you need and through timely submission of payment, you can prove your credit worthiness and quickly boost your credit score.

Zero or low interest rate. There are credit cards for bad credit that are known to carry very steep interest rates. However, you can actually find bad credit credit cards with fair interest rates. Many merchandise cards offer 0% introductory APR for as long as 12 months which is something you can take advantage of. Don’t forget to check the regular rate when the introductory period expires. You can even find merchandise cards that offer 0% APR for life.

Perks and privileges. Merchandise credit card holders can also enjoy special perks and privileges provided by their issuer. For instance, you can enjoy exclusive discounts from your purchases, free shipping services, free gift cards, free credit report, credit monitoring service, ID theft protection, and more. Be sure to check the complete Terms and Conditions before signing up so you can be aware of your privileges and limits.

About the Author
Tara Tiemann is the credit specialist for http://www.go-prepaid.com.  Which is a resource site for people who want to live debt free! If you are on a budget, using a bad credit credit card and merchandise credit cards can save you big money!

For many US consumers, using a credit card to shop is a must. Not only is using a credit card convenient, it can also be the perfect tool to buy a necessity when cash is not available on hand. However, credit card spending poses the threat of debt build-up.

Indeed, many consumers today find themselves stuck in bad debt as a result of accumulating credit card charges. Some people even had to file for bankruptcy in an effort to get themselves out of debt. While many experts recommend smart credit card management, some people are looking for other options.

Is there an alternative to credit cards? Yes, there is. Prepaid credit cards or prepaid debit cards are growing in popularity these days. Consumers can now pick between a regular credit card and prepaid credit card and choose the one that fits their needs.

What are prepaid credit cards and how are they different from standard credit cards? First, the process of application is very different since approval for a prepaid credit card is not based on credit history or credit score. This means, anyone – even people with bad credit or no credit history can easily obtain a prepaid card as long as they meet the basic requirements. Some issuers of prepaid credit cards required an active savings account but some do not. Thus, acquiring a prepaid card is typically quick and easy.

However, unlike a regular credit card, a prepaid credit card does not provide credit limit. For some people, this can be a major disadvantage but it can actually work out for your good too. When you have a prepaid card, you must first deposit funds to your account before you can use it for payment. Once the balance runs out, you must make a new deposit or “re-load” your prepaid card before you can use it on new purchases.

The absence of a credit line can be a great help to prevent debt build-up. So if you’re someone having trouble keeping your credit card charges low, a prepaid card can be the perfect partner for you. You don’t need to worry about incurring interest rate charges if you fail to pay off your full balance because purchases are immediately paid using the funds in your account.

What about prepaid credit card fees? If you plan to get a prepaid debit card, be sure to check all the fees. Some prepaid cards are known to carry expensive fees, and despite not paying interest rate, the maintenance costs can prove to be steep.

Furthermore, you should familiarize yourself with the terms of your debit card to avoid penalty charges. For example, you can still be charged with an overdraft fee if you use your debit card for payment but you have an insufficient balance in your account. While the purchase will usually not be counted, the transaction can still go through if the difference between the purchase price and the available balance is small. However, the next time you reload, the overdraft fee will be deducted from your balance. Look for a prepaid debit card with a minimal set of fees and avoid the penalties as best as you can.

About the Author
Tara Tiemann is the credit specialist for http://www.go-prepaid.com.  Which is a resource site for people who want to live debt free! If you are on a budget, using a prepaid debit cards and Bad Credit Unsecured Cards can save you big money!

People with bad credit may have a limited choice when it comes to acquiring loans and credit cards. Issuers of credit cards and lending companies usually prefer applicants with good to excellent credit. But did you know that you can also use a credit card to restore a good credit standing?

Yes, a bad credit credit card is a type of card especially offered for individuals who are credit challenged. If you are not able to get approved for a regular credit card because of your current credit score, a bad credit credit card is just what you need. On this post, let’s take a look at some of the popular types of credit cards for bad credit:

Secured Credit Card. A secured credit card is much similar to a regular credit card. The only difference is that it requires the submission of a cash deposit. The deposit serves as a security for the future charges. Thus, in the event of default, the issuer can tap into the security cash deposit and use it as payment for any balance left unpaid.

This is why the credit limit is based on the amount of security cash deposit provided. For example, if you placed $300 in your deposit account, the secured credit card issuer may also provide you with an equal credit limit. In some cases, a secured cardholder can enjoy a slightly higher limit than the amount of cash deposited.

Unsecured Credit Card for Bad Credit. There is a new type of a bad credit credit card – the unsecured credit card for bad credit. As the name implies, this type of credit card is also available for people who have a low credit score or bad credit. Nevertheless, it does not require the submission of a cash security deposit.

What are the disadvantages that you can expect? Compared to a secured credit card, unsecured credit cards for bad may carry very high interest rates. The credit limit may also be limited to a low range and if you fail to comply by the terms of the issuer, the penalty fees can be steep.

However, there are solutions for these drawbacks. First, you can avoid paying high interest rate fees by using your unsecured bad credit credit card only for minimal purchases. Pay the balance in full to avoid the extra charge. Stay within your limit, submit your payments on time, and understand your issuer’s terms to avoid being penalized with fees.

Prepaid Debit Card. Another type of a bad credit credit card is the prepaid debit card. In the past, debit cards cannot be used as tools for establishing or rebuilding credit since account activities are not reported to the major credit bureaus. Today however, you can find prepaid card issuers that provide credit reporting to a major credit reporting agency.

It’s important to choose a prepaid debit card that is widely accepted. If you plan to use your prepaid card overseas, it’s best to choose a prepaid credit card that bears the VISA or MasterCard logo to ensure that your card will be recognized anywhere.

About the Author
Tara Tiemann is the credit specialist for http://www.go-prepaid.com.  Which is a resource site for people who want to live debt free! If you are on a budget, using a bad credit credit card and Bad Credit Unsecured Cards can save you big money!

It used to be that people with bad credit only has one credit card option – a secured credit card. However, a security deposit is a major requirement for a secured credit card and you have a limited budget, it can be a hassle.

Today however, credit card companies have introduced a new type of credit card especially created for customers who are credit challenged. What kind of credit card is this? We’re talking about the unsecured bad credit credit cards.

Bad credit unsecured cards obviously do not require the submission of cash deposit. This can be a welcome feature for a lot of people. And since no credit check is done, anyone can get approved regardless of credit score or credit history.

What can you expect from bad credit unsecured cards? First of all, the interest rates are expected to be higher than regular credit cards. In fact, an unsecured credit card for bad credit may carry a higher APR than a secured card. Needless to say, issuers are also concerned about the risks and to make up for the risk of losses, you will incur higher APR charges each time you carry a balance in your account.

Aside from the interest rate, the fees can prove to be just as costly. For example, annual fees can go from $50 to $95. Some unsecured credit cards for bad credit also charge a monthly maintenance fee ($3 to $15) aside from the yearly cost. Processing fees and applications can be anywhere from $50 to $100.

Sum up all the fees and it can get really costly. Despite not paying the security cash deposit, you may still end up spending at least $300 or more in a year on fees and penalty charges. Just imagine incurring all these fees on your monthly bill. On top of that, you have to pay the original amount of purchase you charged to your credit card.

If you decide to apply for an unsecured credit card for bad credit, you should be willing to spend a lot of time evaluating and comparing your options. Read the print and make sure that all the fees have been clearly stipulated and disclosed in the Agreement.

Will you be able to upgrade your account once you have proven creditworthiness? Check your credit report after six months of using your unsecured bad credit credit card. Were you able to improve your credit score? If there is a significant improvement in your rating, call up your issuer and see if you can qualify for a lower interest rate.

Bad credit unsecured cards can be a tool for rebuilding poor credit through regular use and consistent payment of your charges. However, you should make sure that your payments will be accurately reported to the three major credit bureaus (Equifax, Experian, TransUnion). Remember that if your account activities are not monitored, you will not be able to boost your score using your unsecured bad credit credit card.

About the Author
Tara Tiemann is the credit specialist for http://www.go-prepaid.com.  Which is a resource site for people who want to live debt free! If you are on a budget, using a Bad Credit Unsecured Cards and merchandise credit cards
can save you big money!