It’s Not Easy To Get A Credit Card For Bad Credit Unsecured

A Solid Credit Score

A bad or even mediocre credit score will rarely lead to instant approval. Instant approvals are reserved only for the best candidates. You might be wondering how you can become one of these best candidates and it’s actually easier than you think.

Believe it or not, everyone starts off with a high credit score. But if you make late payments, miss payments or get delinquencies, that’s when your score is going to drop. Payment history and amounts owed actually make up around 65% of your FICO score.

It should be obvious why payment history is important. Banks don’t want to lend money to people who don’t pay it back. But amounts owed also carries a lot of weight since banks don’t like to extend credit to someone who doesn’t have the income to pay it back.

If you only make $25,000 a year you’re going to have a tough time spending $3,000 a month on your credit card and paying it all back. That’s why it’s important to keep your balances low and you should always strive to pay off your bill in full every month.

Credit Card for Bad Credit Unsecured: Credit History and Inquiries Matter

It’s unlikely you will get a credit card for bad credit unsecured right out of the gate. If you’ve got a low credit score you’re most likely going to be instantly denied for your card. People in the middle are the ones who will likely get the pending screen and be forced to wait for a decision or call into the reconsideration line.

The most common reason for getting denied or pending is usually a low credit score and/or number of recent inquiries. Banks don’t like to see a lot of recent inquiries (especially if you don’t have much credit history) since it usually signifies a risky borrower so make sure that you space out your applications.

Why Not a Secured Card?

If you really don’t want a secured card ask yourself why not? You can often get a secured card with just $50 out of pocket. That’s a small fee to start rebuilding your credit. So, how much credit card limit will you have? Maybe not much, possibly just $50, but often with a $50 deposit you can get a $200 limit – Capital One does that frequently with a secured card that costs just $29 a year annual fee. Think about it.

Manipulate Your Score

If you want to give yourself that extra edge when it comes to getting instant approvals there are a few tips and tricks you can use to manipulate your credit score. The first thing you’ll want to do is pay off any of your other card balances two to three weeks before you apply (and keep them paid off). This will lower your utilization rate or amounts owed which accounts for 30% of your score. You want to do this ahead of time since there is often some lag between when you pay off your accounts and when it gets reported to the credit bureaus.

If you don’t have the money to completely pay off all your cards, try to spread it around so that no one individual card has too high of a balance. Credit card companies will look at your overall utilization rate and the amount owed on each card.

The last thing you can do is get added as an authorized user onto a friend or family member’s account. This will give you an extra account on your credit report and help increase your total available credit. Ultimately, you can’t guarantee yourself an instant approval but it’s all about putting yourself in the best position possible.