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Bonsai Finance: Getting a Credit Card for Bad Credit

If you have a poor or a bad credit, it can be tempting just merely accepting whatever terms a credit card issuer offers. 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. It is possible to help rebuild your credit history with the help of a credit card as you pay on time without having to pay exorbitant credit card fees. It is best to work with a credit card company that reports good payment behaviors to the credit bureaus to help in building your credit and establishing a healthy financial behavior.

Secured credit cards are preferred that prepaid debit cards for individuals who want to rebuild their 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. For balance transfer fee, it should only be around 3% to 5% of the transferred amount to transfer a balance from one credit card to another. Balance transfer fee is not usually charged for people with good credit. 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 important things you can do for your credit card to help you? It is best to find a secured credit card that can help you graduate to an unsecured card as long as you do good in your payment performance for at least a year. 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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