If you have gone through a rough financial situation and now your credit score is low, you probably know the chance of securing a credit card in the US is tough. Unfortunately, many dishonest companies offer credit cards to people in this type of situation but without reading the details of the agreement, the cardholder ends up stuck with hidden fees, high interest rates, and other horrific challenges.
The good news is that there are a number of credit card offers in the US for people just like you. After all, good people can go through tough financial situations and when it comes to rebuilding, most people deserve a second chance. To secure a credit card while having bad credit is not overly difficult but it does require you to look at multiple options to ensure you do not find yourself in a worse situation.
We suggest you start by looking at what your current bank or credit union offers but if they do not have any credit cards for people with bad credits, look at what the leading issuers offer. For instance, you could look at cards from Capital One, Chase, US Bank, Discover, etc. These larger credit card companies typically have more than one card for people with bad credit but even with this, you want to look at all the information pertaining to the card of interest.
Now, the best option would be to order a free copy of your current credit report from the three reporting agencies one year to six months prior to applying for a US card. For this, you would call or send a letter to TransUnion, Experian, and Equifax, and in return, they would forward a copy of your latest report. With the information in hand, you would go through each line item, looking for mistakes, which could be erroneous information, omissions, someone else’s information on your report, incorrect name/address, etc. From there, you would provide the wrong information to the respective agency for the credit report to be cleaned up.
During the six to twelve month-period, your credit score would improve and the goal is for the score to increase enough that you would qualify for an unsecured credit card instead of a secured card. However, in the US secured credit cards serve a purpose. With this, you would make a deposit in the required amount into an account associated with the card. The amount of money deposited becomes your credit limit for spending. In other words, if you were allowed to make a $500 deposit, you would have $500 on the card to spend.
While this may seem silly to put money on a credit card when you could use the money to pay cash, remember that secured credit cards in the US are backed by MasterCard or Visa. Therefore, each time you make a purchase, keep the minimum deposit at the required level, and follow all the rules established by the issuing company, you build credit. Over time, the issuing company would switch you from a secured card for bad credit to an unsecured card. Even if your credit were not in perfect order, this would help improve it enough to make you a more creditworthy person.
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