Bad credit happens to even the best people. That’s why poor credit credit cards exist. Sometimes, life just gets in the way of the best laid plans and you find yourself unable to fulfill your financial obligations. You need credit cards for bad credit. Maybe you are one of the one million and more people forced to file bankruptcy in the last year, or a victim of the recent financial problems that mired our country down in unemployment and home loss. Whatever your situation, if you have bad credit financial guru SuzeOrman says that it is important that you accept it, take a deep breathe, stop hating yourself for it, and move on towards making things better.
The first thing that you need to do before you worry about poor credit credit cards is work on fixing the negative things in your credit report. This means paying off outstanding bad debt if you can. But do be aware of the laws in your state. Most states have laws that say that after seven to ten years you are no longer liable for bad debt and it must be removed from your credit report. If your debt is that old file a complaint to have it removed from your credit report.
If your debt is nowhere near being removed due to age then see if you can get it paid off. Many banks will negotiate with you to get a lower payoff amount. In fact, it is not uncommon to pay just 30% of your outstanding balance and be forgiven the rest! But, be warned, if you make a payment on “old” debt it becomes “new” debt again. That is, the age of debt is determined by the last time you made a payment. So look into this situation thoroughly before you make any decisions.
Remember that the older a negative item on your credit report is the less it will impact your FICO score. So, if you were late on your car payment one time it may have really pounded your score for a few months, but after a year or two or three the damage will be little. So even if you have otherwise excellent credit, one late payment can really hurt your short-term ability to get credit. However, the amount of a debt doesn’t matter; one late payment of $25 will hurt your score as much as one late payment of $900.
Once you have your credit score fixed up, or at least are on the road to it, it’s time to start rebuilding by getting a new credit card, if you don’t have any cards now. You need easy approval credit cards so you won’t be able to be super choosy at this point, but do still shop around. Even poor credit, credit cards come in a variety of shapes and sizes, so don’t just jump on the first card that you see.
Do expect to pay some fees. Likely, you will have to pay at least an annual fee. You may also be required to put money on reserve for a secured credit card. Usually, these situations are only temporary until you get your credit back on track.
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