Poor credit or bad credit is not a hindrance for getting a credit card in today’s market place. There are several issuers that will guarantee a credit card in your name by simply applying on line. The first question that comes to mind is, “Where’s the catch?” The catch is that they want your business. There will be some limitations on the card that you will not normally see on a standard card.

Guaranteed issue cards will usually have a low limit on the maximum charges. Some of these cards may be as low as $200, while others will go up to $5000. If you are trying to rebuild credit this may be a good deal for your situation. Spending $200 a month on budgeted items is easy for most family units. Paying the bill on time and in full will help increase your FICO score and allow you to get a better credit rating and ultimately a higher maximum limit.

Going this route does take time and diligence but it can be done. If your bill is paid off each month there is no need to worry about the APR, (monthly interest rate). That rate will usually be over 10%, but it cannot hurt you if you do not carry a balance.

Some issuers may charge a hefty annual fee. Shop the market and find a card that makes an introductory offer of no annual fee for at least the first year. At the end of 12 months you have the option to renew or cancel to avoid the fee. Try not to take cash advances on these cards because they will charge you a higher interest rate. Since you are trying to restore a good credit rating this should not be a normal budget item.

Credit card companies make a large share of their income from interest payments. They play a numbers game and hope people do not pay off the balance so they can make money. Use your discipline and budget to beat them at their own game. Your priority is to have better credit and their priority is to make money. Use your card wisely, be on time with payments and do not carry a balance.

By: William Sears

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