Credit cards are excellent items to have in times of emergency. They also provide the user with a great alternative method of paying for bills. Unfortunately, when an individual has a negative history with lenders, he or she may find it difficult to obtain a traditional credit card.

Cards for bad credit are cards for people who repeatedly get denied by the traditional credit card company. They look just like regular credit cards, but the terms and circumstances vary. Nowadays, it is not good for a person to go without a card.

The following are types of cards for bad credit people can apply for if they need one:

Prepaid Debit Card

A prepaid debit card works exactly like a credit card. The difference is that the cardholder funds the card. He or she adds money to the card online or through a participating retailer. The person makes purchases as usual. When there is no more funds left on the card, the user may not make anymore transactions until he or she reloads the card. once the card is reloaded, the individual can enjoy making purchases again.

Secured Card

A secured card is a credit card that the cardholder secures by opening up a bank account. The way it work is that the applicant will apply for the card. The credit card company will approve the secured card on the condition that the applicant sends in a deposit that is equal to the credit limit. The bank will hold the deposit until the cardholder has shown a history of faithful payments for a period of one year. After such year, the cardholder will receive the deposit back and the bank will issue him or her an unsecured line.

High APR Cards

Some high risk lenders choose to take a chance on people with bad credit. Their cards for bad credit only differ slightly from traditional cards. The annual percentage rate is usually extremely high and the credit limit is extremely low.

Categories: Credit Cards

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