Title:

"Bad Credit" Credit Cards: How You Can Avoid High Fees
Word Count:
723
Summary:
Individuals with problematic credit histories often suffer unfairly from high mo
rtgage, insurance, and car loan rates. On top of that, they have difficulty gett
ing approved for credit cards. The whole situation can get extremely frustrating
. Frequently, I get emails from consumers wondering what they can do to rebuild
their credit. The first thing I tell them is to get a credit card designed for p
eople with bad credit. The second thing I tell them is written in bold: READ THE
...
Keywords:
bad credit card, bankruptcy credit cards, poor credit credit cards, credit card
fees
Article Body:
Individuals with problematic credit histories often suffer unfairly from high mo
rtgage, insurance, and car loan rates. On top of that, they have difficulty gett
ing approved for credit cards. The whole situation can get extremely frustrating
. Frequently, I get emails from consumers wondering what they can do to rebuild
their credit. The first thing I tell them is to get a credit card designed for p
eople with bad credit. The second thing I tell them is written in bold: READ THE
FINE PRINT.
There are only a limited number of credit cards for individuals with bad credit.
At first glance, many look the same. They all help build and rebuild your credi
t by reporting to the major credit bureaus on a monthly basis. They all provide
you with the Visa or Mastercard you need to make many purchases. And they are al
l necessary evils that can save you thousands of dollars in mortgage and car loa
n rates in the future. However, you must read the fine print before applying for
one of these credit cards, as they often charge high yearly fees, set-up fees,
and even monthly fees. Here, I will examine a few examples of charges current bad
credit credit cards bury in the fine print. Of the three major cards I will exam
ine, only one stands out as consumer-friendly.
Bad Credit Credit Card #1: This credit card charges a very low interest rate for a
n unsecured credit card. However, your first fine print glimpse reveals that the
re is a one time setup fee of $29. Not too bad. So far, since the next charge is
a one time fee of $95. So far, we re up to $124 in expenses. That s got to be it, r
ight? No. Add in another $48 for the annual fee and $6 per month in account main
tenance fees. That s brings the cost of your new credit card to $244 the first yea
r, and $120 each additional year. This is no small change, and a card such as th
is should be considered only if you cannot be accepted for a better unsecured cr
edit card for bad credit.
Bad Credit Credit Card #2: This credit card charges a very high interest rate for
an unsecured credit card. This can t be good. But the setup fee is only $29. Maybe
this card isn t so bad. There is that pesky monthly maintenance fee of $6.50 per
month which brings the cost of this unsecured credit card to $107. Maybe we ve fou
nd a bargain. Not quite. The annual fee is a whopping $150. Yes, $150 every year
. That not only brings the initial cost up to $257, but you will also pay $228 a
year just to maintain the credit card. There has to be a better offer.
Bad Credit

Credit Card #3: This credit card is available as both a secured and uns

ecured credit card, based on the issuer s review of your credit history. The inter
est rate is average, even competitive. Now, the fine print reveals that there is
a one time setup fee. However, based on your credit, this fee can be as low as
$0 or as high as $49. So far so good, especially if your credit is not that bad.
But, there must be a huge annual fee. Not exactly. The annual fee for a secured
credit card is only $35, and for an unsecured credit card, this fee can be as l
ow as $39 or up to $79. So far, the cost of this card ranges from $35 to $128. N
ow its time for the monthly maintance fee. This one has to be huge. Or not. Its
$0. That means the most you could possible be charged to obtain this credit card
is $128, about half of what competing cards are charging.
Clearly, there are substantial difference between bad credit credit cards. Of the
three offers we have examined, only one doesn t take you to the cleaners. In fact,
bad credit credit card #3 provides great value. All positive changes to your cred
it history and credit score will translate into lower loan rates, lower credit c
ard interest rates, lower insurance rates, and ultimately, thousands of dollars
in savings. The path to rebuilding credit has its costs, but in the long term, r
ebuilding your credit with a bad credit credit card is the fastest and most cost-e
fficient way to correct the often unfortunate circumstances that have damaged yo
ur credit in the first place.
2006 Credit Card Depot Inc.