Now you can select from a range of bad credit unsecured credit cards. These financial products have gained popularity among lenders and borrowers alike. Even though availability is great, you should definitely know how to look for the best possible deal and manage your finances effectively.
Shop around and look for deals that have high yet reasonable interest rates. You would not want to get a card that will charge you over 20% in terms of interest. Be careful about products that come with a range of extra benefits and dividends. These deals are usually quite good, but sometimes they result in a higher interest. In this way, instead of getting dividends for free, you actually pay for them perhaps even more than they cost.
Similarly, you have to make sure that the fees you will have to pay are affordable. Check for annual fees, monthly fees and balance transfer fees. These are often sky high and in some cases remain hidden. In general, the more carefully you read the fine print the better.
Try to get bad credit unsecured credit cards with limits that are as high as possible. If you have low limit and use it up, your credit score will be negatively affected. Additionally, try to limit your cards to two or three at the most. Some lenders are known to push their higher-risk customers into getting a number of such products with low limits and high interest. These will just get you into more debt, so try to avoid taking advantage such deals.
You should not transfer balances form one card to another too often. This is a suitable short-term solution that you can use a couple of times, but if the credit bureaus notice that this is a regular financing pattern for you, they will automatically lower your credit score. That is why you should have long term commitment in mind when applying for a card.
You should not use up more than 30% of the limit on each card. Still, you should try to use your bad credit unsecured credit cards as much as possible. You can set up direct bill payment and use them to finance different kinds of purchases. Just remember that repaying debt on time is essential.
Use this advice to manage your bad credit unsecured credit cards. Keep in mind that even if you have bad credit, you still have the right to terminate a contract with a lender in case they try to impose new conditions that you do not accept.