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Bonsai Finance: Getting a Credit Card for Bad Credit

It can be tempting just accepting whatever terms and conditions a credit card issuer provides if you have a poor or a bad credit. While people with a poor or bad credit might be limited to get financial help from traditional sources like banks, there are other alternatives you can choose from such as credit cards for bad credit. By using a credit card properly and paying your due on time, it is possible to help rebuild your credit history without having to pay significant amount of credit card fees. Just imagine getting approved for a credit card, responsibly using it, paying your bills on time, and in the end you realize that all your efforts are not being reported to the credit bureaus.

The best option for a credit card for those people with a bad credit are secured credit cards because prepaid debit cards cannot help rebuild credit. A secured credit card will require a cash deposit, working like a regular credit card, wherein you can borrow money, pay on time, and assured that good payment behaviors are reported to credit bureaus to help rebuild your credit history. Beware of credit card issuers who gouge people with a poor or bad credit with excessive fees. The annual fee, balance transfer fee, and late fees are the most common fees on credit cards for poor credit. While there are credit cards without annual fee, the maximum acceptable amount is $30, and consider a red flag more than this amount. When it comes to transferring a balance from one credit card to another, the acceptable and reasonable balance transfer fee is between 3% to 5% of the transferred amount. For individuals with a good credit, balance transfer fees are usually not charged. When it comes to late fees, this can take a hit, but the maximum late fee is $27 for the first offense, and $38 for the succeeding for missing a due date.

In order to help in the improvement of your overall financial health, it pays off choosing a credit card offering tools to help you in monitoring your credit with the help of debt-payment calculators or free financial education programs. What are the good credit card management strategies you can do to your advantage? Provided that you pay on time for at least a year, a credit card issuer can help you switch from secured credit card to unsecured credit card, so work with a trusted and reliable credit card issuer to help you achieve this. Even if your older accounts can help with your credit score, it is not worth it paying an annual fee, so it best to find an unsecured credit card without annual fee. For millions of people with a bad credit, they usually prefer to eliminate plastic cards, but using a credit card is the fastest and most-effective way to help rebuild your credit, so this is your best option if you have a bad credit.

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