Bad credit guide
If you have a bad credit history, it can be difficult to get a credit card. Compare bad credit credit cards with MoneySuperMarket, check for the best deals on balance transfers and purchases, low APR rates and reward schemes. If you have a less-than-perfect credit history, you are unlikely to qualify for the best deals, but you can build up your credit with a bad credit credit card.
Not only that, but you may find it hard getting accepted for a standard credit card, one without any enticing 0% offers, but why is this the case? Let’s take a look…
Each time you apply for a credit card, the lender will carry out a credit check to look at your credit history and assess whether or not they consider you a ‘credit risk’ – that is, a borrower who is likely to default on their debt by failing to keep up with repayments.
The problem is, it’s not just genuine ‘credit risks’ that have a low score; you could find that you struggle to get credit if you have never had credit before, are not on the electoral roll, are on a low income, are self-employed or in part-time employment.
However, even if you have a low credit score, you may still have access to credit via a bad credit credit card.
Designed for those who don’t qualify for conventional credit cards, bad credit credit cards carry higher interest rates to reflect the greater ‘risk’ to the lender, but if you clear the balance in full at the end of each month you won’t incur any interest charges on your purchases.
So if you are looking for a credit card but have a poor credit rating or have had an application rejected by more mainstream lenders, then it may be worthwhile applying for a bad credit credit card.
Credit cards for bad credit pros
- Improves credit score if balance is payed off in full each month.
- Can lead to an increase in your credit limit, a reduction in your interest rate or you may be able to apply for a mainstream card with a lower interest rate or introductory offer.
- Offers the same consumer protection as other cards
Credit cards for bad credit cons
- High level of interest - should not be used for long term debt. Spend as much as you will be able to pay off at the end of each month to avoid steep interest repayments.
- They rarely come with any introductory offers, such as interest-free periods or rewards.
Why compare bad credit credit cards with MoneySupermarket?
Although they all come with relatively high interest rates it is still worth comparing bad credit credit cards as the market is now becoming much more competitive.
For instance, although still uncommon, you can now get bad credit credit cards that offer interest-free periods or rewards on purchases.
It’s also worth comparing the interest rates on offer, even if you are planning on paying the balance off in full each month.
Representative annual percentage rates (APR) can range from around 30% to 60%, so getting a card with the lower APR could save you money should you not be able to pay the full balance.
And by using MoneySupermarket’s price comparison tool you can instantly compare a full range of bad credit credit cards and make an informed choice on the right card for you.
We're free and independent, as well as offering exclusive deals you can't get anywhere else.
Moneysupermarket is a credit broker – this means we’ll show you products offered by lenders. We never take a fee from customers for this broking service. Instead we are usually paid a fee by the lenders – though the size of that payment doesn’t affect how we show products to customers.