Having a history of bad credit is not easy to deal with, but those that have suffered from credit problems in the past will still be able to get a credit card issued. Many people are carrying credit card debt for many years and this debt will affect the overall credit score. When a person has a low credit score, they will find that when they get a new credit card, they will be faced with very high interest rates. The reason for this is because the issuing company will see the new card holder as a risk and will thus increase the amount of interest for the account balances that are held.
There are some great and reliable companies that are offering special cards to those that have bad credit. These credit cards will work like all others, but there are some stipulations. First, many will have an annual fee to hold the card. This can average around $100 per year, so this is a cost to consider when looking for a card if you have bad credit. In addition, the credit limit on the card will often be low, so it cannot be used for major purchases. This is another way to reduce risk for the card company.
Most credit cards that are issued to those with bad credit will have very high interest rates and penalties for late payment. It is not uncommon for these cards to have rates of more than 20%. This is a very high price to pay, so when getting a credit card with bad credit, it is essential to make the payments on time to avoid these massive fees. As people rebuild their credit through use of the card and on time payments, they can apply for different cards that are geared toward those with average or above average credit, reducing fees and interest rates and increasing the line of credit on the card.