If you have bad credit, it’s easy to assume that you’re disqualified from obtaining a credit card or loan. While it’s sure to be more difficult, there are steps you can take to improve the odds of securing the financial product you’re most interested in.
So, can I get a credit card with bad credit? The simple answer is yes. Even if your credit score is less than desirable, there are steps you can take to obtain a credit card that can improve your financial circumstances over the long haul.
Here are three tips to use to your advantage if you have bad credit and are in the market for a credit card:
1. Pinpoint the reasons for your bad credit
You can’t make things better until you know which mistakes you’ve made in the past. Carefully review your budget and credit report for a clear understanding of where you’ve gone wrong.
Once you know why you have bad credit, you can avoid heading down the same path in the future.
2. Improve your credit score
If you’re struggling to qualify for a credit card, take a step back and outline a strategy for improving your score. There are many ways of doing so, such as:
- Paying down credit card balances
- Paying all your bills on time
- Disputing inaccuracies on your credit report
- Catch up on any past due accounts
You can’t improve your credit score overnight, but you can begin to make progress by doing these four things.
3. Opt for a secured credit card
A secured credit card requires a security deposit. As long as you don’t default on your account, you’ll receive the money back when you close it.
The benefit of a secured credit card is the ability to build your credit score without the risk of running up a large balance. Making timely payments will help increase your score, which moves you closer to applying for an unsecured credit card.
Tip: Before signing on the dotted line, make sure the credit card issuer reports all activity to the three primary credit bureaus. You want to get credit for your responsible spending.
According to Experian, “on the FICO Score scale of 300 to 850, one of the credit scores lenders most frequently use, a bad credit score is one below 670. More specifically, a score between 580 and 669 is considered fair, and one between 300 and 579 is poor.”
If your credit score is below 670, implement the tips above on your search for a credit card. This advice may be just what you need to obtain a card that can improve your financial future.