What ever the reason that your credit score has bottomed out, you still need some form of credit available. If you do not have any credit or your credit is bad, you will need to rebuild your credit score and for that you need credit. You can always get a secured credit card or a prepaid credit card, but both of these options, while they prevent you from increasing your credit card debt, will not help you to rebuild your credit.
You are not without hope though. In order to rebuild your credit you will need an unsecured credit card. You will not be able to obtain one of the premium cards with no annual fees, and other incentives. There are quite a number of banks and other companies that specialize in issuing unsecured cards to people with bad credit. There are fees with these cards however and you should consider each carefully before applying for any card.
1. Most issuers that specialize in people with bad credit charge a one-time application fee that can easily exceed $100. If you are not prepared to pay that much, you may have to rely on other alternatives. Added to that fee some issuers charge a one time processing fee.
2. Next you will be paying both a yearly fee, for the “privilege” of using their card along with a monthly processing fee which is usually between $5-$15.
This means that you will be paying well over a hundred dollars just to get your card processed and then monthly and yearly fees. If you have bad credit however and want to do things that take credit, like buying a car or home, you will have to pay to play. Once you have one of these cards the only method to achieve our short term goals, getting a better card, is to pay your bills on time and improve your credit score.
Before accepting any of these cards make sure that the issuers has a good reputation. It is very easy for any company to be a credit card issuer and, because of this, there are companies out there who cannot be trusted. Check out the issuer first. Make sure that the issuer reports to all three credit reporting agencies, and chose the one with the lowest annual percentage rate.