nigel woollsey

Nigel Woollsey

Online Writer
Published: 05/02/2019

At a glance

  • Credit cards for poor credit borrowers work by offering some people a route back from debt.
  • Generally, the APR will be a lot higher than that offered by a normal credit card.
  • Providing you use your card responsibly, keeping within your credit rating and making repayments on time, your credit score will improve.
  • On some cards, your APR will reduce over time as you become considered less of a risk.

How do credit cards for poor credit work?

If you’ve got 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 repair cards are not for borrowing on

Credit cards for poor credit give you an opportunity to repair or build your credit score but, because the APR is high, you should try to avoid borrowing on them.
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 – most cards will allow you to set up a direct debit to do this.

Is a credit repair card right for me?

Credit cards for poor credit should not be looked at as a method of racking up yet more debt.  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.

You don’t have to get a credit card – some prepaid cards allow you to repair your credit score as well.  Some 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. 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.

Pros and cons of bad credit, credit cards

  • Although bad credit, credit cards will usually have a lower credit limit than a normal card, it’s still a credit limit.
  • Over time you’ll be able to start improving your bad credit rating.
  • Some cards also offer rewards or cashback on spending.
  • You need to spend on the card (and pay this back) so that this is reflected in your credit rating.
  • You may end up getting into even more debt if you don’t pay the whole sum owed every month.

Moneyfacts tip

Moneyfacts tip nigel woollsey

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

Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

pile of bank cards

At a glance

  • Credit cards for poor credit borrowers work by offering some people a route back from debt.
  • Generally, the APR will be a lot higher than that offered by a normal credit card.
  • Providing you use your card responsibly, keeping within your credit rating and making repayments on time, your credit score will improve.
  • On some cards, your APR will reduce over time as you become considered less of a risk.

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