There is a whole industry of sub prime lenders ready to extend credit to those with bad credit. Pay day loan lenders have a bad reputation but often represent one of the best deals to those who use the loans responsibly. Unfortunately they only report negative information regarding repayments to the credit agencies so don’t assist those with bad credit in rebuilding their credit.
The lure of credit cards draws many people with bad credit, who remain determined to carry a credit card at any price. Many applicants for credit cards aimed at those with bad credit fail to read beyond the headline offer which is often a letter of pre-approval. They only realize the mistake they have made when the charges which their signature entitled the creditor to are withdrawn from their bank, or used to reduce the available credit line on the card they have received.
The absolute worst card for bad credit is the scam card still advertised from Anacott Financial. The advertisements are deceptive and offer a credit card which does not exist, but is instead a card which can only be used to purchase financial products from Anacott. Whether these products actually exist is debateable, but the card costs $99 to procure and in most cases never arrives. Those who apply are simply scammed.
First Premier bank offers a range of credit cards aimed at those with bad credit. Each levy exorbitant fees which they justify by saying that 25% of their card holders with bad credit default on their payments. As well as the high fees attached to First Premier cards they also carry very high APR’s, with both 59.9% and 79.9% on offer. Typically users complain that the card fees reduce their available credit limits.
First Premier practice the art of getting round the credit card amendment laws of allowing fees to be no more than 25% of the credit limit, by charging an application fee before the card is opened. However this practice is now being regulated against which will put an end to it. First Premier will need to increase their APR’s to cover the loss of this fee.
There are a number of cards which are currently advertised as credit cards, which are not actually credit cards. Instead they are cards which can only be used at specified online shopping sites and nowhere else. They also carry high fees and leave users generally frustrated when they presumed they were applying for credit cards.
The First Platinum Plus card can only be used at one specific online shopping site and only reports to one credit bureau. The annual fees total $359. The Horizon Gold shopping card has reduced its fees but is again restricted in use to the Horizon shopping site. Although the limitations of these cards are clear when one reads the terms and conditions, they are in fact misleadingly and deceptively advertised by a host of online credit card sites which recommend credit cards for bad credit, and fail to describe their actual usage.
If you have bad credit but are determined to obtain credit the best offers are only available to you if you work to improve your credit first. If you are tempted by the lure of easy credit then check carefully the full terms and conditions before you sign up, or run the card name through the internet to see if a litany of complaints comes up.