Compare the best credit cards for poor credit

If you’ve god a bad (or no) credit history you’ll find it hard to get accepted for a credit card, loan or even a mortgage. The trouble is, if no-one gives you credit, how can you ever improve your credit score and benefit from less expensive borrowing costs?

Credit cards for poor credit borrowers work by offering some people a route back. Generally, the APR will be a lot higher than that offered by a normal credit card. However, providing you keep up your repayments, your credit score will improve. On some cards, your APR will also get lower as you become considered less of a risk.

Bad credit cards are not for borrowing on

Credit cards for poor credit give you an opportunity to repair your credit score but, because the APR is high, you should try to avoid borrowing on them.

Remember that although bad credit cards will usually have a lower credit limit than a normal card, it’s still a credit limit.

You’ll need to spend on the card to have a balance to repay (and therefore evidence your responsibility as a borrower). However, you should aim to repay the balance in full each month – some cards will allow you to set up a direct debit to do this.

Is a bad credit card right for me?

You shouldn’t look at credit cards for poor credit as a method of last resort borrowing.  At best, these cards can improve your creditworthiness and get you accepted for credit more easily.  At worst it can just end up as another maxed out credit card – and an expensive one at that.

If you can trust yourself not to give into the temptation to spend, a bad credit card might be right for you.  If you’re unsure how you’ll behave with the card, it’s wise to stay well clear.

You don’t have to get a credit card – some prepaid cards allow you to repair your credit score as well.  They charge a monthly fee (usually in the region of £5) and, once you’ve paid your fee for a year, a positive entry is added to your credit file. The great thing about prepaid cards is that it’s impossible to get further into debt and there’s no credit check or possibility or worsening your credit score.

There are other ways to improve your credit rating – even if you’ve missed payments before, keeping up-to-date with all your existing credit agreements will improve your score. And it’s also a good idea to request your credit report – just to make sure there are no errors or fraudulent credit agreements in your name.