How To Get a Credit Card With Bad Credit

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How To Get a Credit Card With Bad Credit

If you have a poor credit history, you might struggle to get a mainstream credit card. But this doesn’t mean you can’t get a credit card at all – there are a number of credit cards designed for people with bad credit.

What is bad credit?

‘Bad credit’ is a term used to describe people with a low credit score. What counts as a low credit score depends on which credit reference agency is being used – they all use different scoring systems.

A low score with Transunion is anything below 565 (out of a maximum score of 710). With Equifax it’s 438 or below (out of 1,000), and with Experian it’s 720 or below (the maximum score is 999).

What can cause bad credit?

You might have bad credit if you have failed to make payments on past credit agreements on time, or if you have fallen into arrears on household bills or your mortgage.

You’ll also be classed as having bad credit if you have County Court Judgments (CCJs) against your name, or if you’ve been made bankrupt.

Some people have ‘bad credit’ because they don’t have much experience of credit – normally because they are young – or because they are new to the UK (credit files don’t move country with you).

Can I still get a credit card with bad credit?

If you have bad credit, you are likely to be rejected for best buy and most mainstream credit cards. But some providers offer credit cards specifically for people with bad credit – these are usually called ‘bad credit credit cards’ or ‘credit builder credit cards’.

If you apply for one of these cards you are less likely to be rejected because of your credit history.

Bad credit credit cards tend to have a high APR and lower credit limit.

How to use a credit card for bad credit

If you take out a credit card for bad credit, you can use it to improve your credit score. This means:

  • Spending on the card each month

  • Staying within your credit limit

  • Repaying your balance in full each month

  • Never missing a monthly payment

Warning: Credit cards for bad credit come with high APRs. It’s important to pay off your entire debt each month, otherwise high interest charges will add a significant amount to your debt.

How to get a credit card with bad credit

If you have bad credit and apply for a standard credit card you’re likely to be rejected. This can further harm your credit score and make it even more difficult to be accepted for credit in the future.

You can use a credit card eligibility checker to see how likely it is you will be accepted for a certain card before applying. Checking your credit card eligibility can help you to avoid damaging your credit score with rejected applications.

It’s also a good idea to check your credit report. If you spot any incorrect information, you can raise a dispute and fix any errors.

If you decide to opt for a bad credit credit card, shop around and compare the different offers. Some cards offer 0% interest periods for purchases or balance transfers. These won’t be as long as those on mainstream credit cards, but they can still be useful to have. Some bad credit credit cards also offer cashback or rewards, which can be useful.

What if my application is rejected?

If your credit card application is rejected, don’t reapply for another card straight away.

Too many rejections on your credit report in a short amount of time can further damage your ability to borrow. In some cases, you might be better off using your overdraft or applying for a loan for people with bad credit. But make sure you do your research and calculate the costs.

Bear in mind that if you opt for a ‘homeowner loan’ or secured loan, your home could be at risk of repossession if you don’t repay the debt.

How to improve your credit score

  • Check your credit report and get any errors corrected

  • Make sure you’re on the electoral roll at your current address

  • Be careful taking out joint credit agreements with someone else

  • Never miss a debt repayment

  • Pay household bills on time

  • Don’t apply for too much credit

  • Pay off debts with savings if possible

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Use your card sensibly — if you don’t make repayments on time or stay within your credit limit you will pay extra charges, forfeit the 0% offer and getting credit in the future may be harder and more expensive.

Credit is available, subject to status, only to UK residents aged 18 or over.

NewDay Ltd provides our credit here at Fluid. TM Connect Limited promotes the Fluid card exclusively with NewDay Ltd and acts solely as a credit broker. Fluid is a registered trade mark of TM Connect Limited, which is used under licence by NewDay Ltd.

NewDay Ltd and NewDay Cards Ltd are companies registered in England and Wales with registered numbers 7297722 and 4134880 respectively. They form part of the NewDay group of companies. The registered office for these companies is 7 Handyside Street, London, N1C 4DA. NewDay Ltd and NewDay Cards Ltd are authorised and regulated by the Financial Conduct Authority (FCA) with numbers 690292 and 682417 respectively. NewDay Ltd is also authorised by the FCA under the Payment Services Regulations 2017 (ref no: 555318) for the provision of payment services.

TM Connect Limited is registered in England and Wales (Company Registration Number 06967012) and authorised and regulated by the Financial Conduct Authority in respect of consumer credit related activities (FCA FRN: 511936). Trading Address and Registered Office: Chapter House, 16 Brunswick Place, London N1 6DZ. TM Connect Limited is a credit broker and not a lender.