An Unsecured Second Chance Credit Card For Anyone With Bad Credit Or After Bankruptcy

An Unsecured Second Chance Credit Card For Anyone With Bad Credit Or After Bankruptcy

As much as a person may have really bad credit, he or she may still qualify an unsecured second chance credit card. As the name implies, this is a second chance type of credit card meant for people who do not meet the average credit standards normally required to be approved for a credit card. These are unsecured cards as well, which means that they do not require any type of security deposits. In this article, we will take a look at how these credit cards are helping folks with poor credit or who have gone through a recent bankruptcy. We will look into both the pros and cons, so that at the end, readers can get a good sense of whether this could be right for them to pursue.

Rebuilding Credit History

The benefits of a unsecured second chance credit card extends beyond the convenience of being able to make purchase transactions anywhere without carrying stacks of bills. It help in building up on a person's financial life. If you use the second chance card in a responsible manner (eg. no late payments, missed payments, charging only a small percentage of the balance limit etc), this activity will help you rebuild your credit history.

The card user's positive activity will be reported to the major credit bureaus like TransUnion or Equifax. With this, you provide factual evidence to the credit bureaus that you can handle credit well, and that will help to build your credit score.

Fees & Interest Rates

On the minus side of things, the terms for a bad credit unsecured card can be so tough that it could make it not worth the while to have one. For example, you may have to pay an application fee and annual fee just to get the card. Also, the interest rates on the card will be extremely high. You end up with a credit line that does not make sense to use because of the ultra-high interest cost.

If you are someone who is good with managing your payments and can pay the balance in full each month, this is less of an issue. However, there is still a risk in case, as a lot of us miss deadlines when we have a lot in life to deal with. If you do not feel comfortable with this point, a secured second chance card could be more helpful.

A unsecured second chance credit card is best suited for someone who is ready to step out of a history of bad credit or leave the past of bankruptcy. You must be willing to be vigilant in using this card. It is best suited for the person who has the ability to pay off the card balance in full every month so as not be challenged with high interest payments that could result. If you can do that, then this card offers lots of key advantages - like the ease of paying with a credit card instead of carrying lots of cash, as well as the second chance to re-establish your credit.

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