Credit Cards for Bad Credit
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by: barrywaters
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Word Count: 538
The credit crisis of the past year and the economic downturn caused lending institutions to adopt more restrictive standards for borrowers, which means there are more people who looking for credit cards for bad credit. The Target Corp recently put out its earnings for the last quarter. In addition to suffering from sluggish retail activity, its earnings were hit hard by a $135 million loss it has to reserve to cover its rising delinquent credit card accounts. Adopting stricter lending requirements is one of the goals for the company to help it stay afloat. That means that fewer consumers will qualify for a Target credit card. In fact, the company has stated that its focus moving forward will be to provide quality goods and services to its customers in its retail stores. Consumers looking for credit cards for bad credit may be turned away by Target. Other lending institutions and banks are joining the movement in tighter standards, as well. They have applied higher interest rates and fees, lowered allowed limits and closed accounts, because of so many delinquent accounts. Another company that followed suit and even raised the bar for standards is American Express. The company announced a deal for its most delinquent account holders to close their accounts. If those delinquent customers pay their balance and cancel their cards by April 30, American Express will give them several hundreds of dollars in cash. Those seeking credit cards for bad credit need not apply to American Express right now. Not everyone has made the best financial choices and, consequently, will have to shop for credit cards for bad credit. The best way for people to establish credit and have a credit score is by having credit cards in good standing. You need a credit history to get credit. It is a tough dilemma for those struggling to establish credit or rebuild after some financial mistakes. Consumers who are shopping for credit cards for bad credit will find that offers available to them come with extremely high APR rates. Many exceed 35 percent. Many consumers who have to choose cards with higher fees and interest rates find it difficult to stay on top of the bills, which then will adversely affect their credit scores and reports. A safe option for those who are shopping for credit cards for bad credit is a credit card that is paid before it is used. A credit card with a prepaid balance will not let consumers fall into the trappings of a regular card. The balance has been paid, so spending beyond means will not happen. And it will not let a consumer easily fall into debt. The consumer must pay for the card first, so it does not require a credit check. This can be a fantastic solution for consumers who wish to have the convenience of a credit card for everyday uses, but may not qualify for traditional credit cards. Prepaid cards have an added bonus in that they train you to think about credit card spending differently, since it is your money paid up front. The downside to some prepaid credit cards is that they may charge a fee or do not report to credit agencies. .
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