Credit Cards Explained: How to Get a Credit Card with Bad Credit or Good Credit
If you have never applied for a credit card before, you may be wondering what the credit card application process looks like. While individuals with good credit may be curious about how to apply for a credit card, those with bad credit may be wondering if it is even an option.
This will be your guide on how to apply for a credit card with bad credit or good credit. We will take you step by step through the process, from learning your credit score all the way to credit card processing.
We will also answer some questions you may have on how to apply for credit cards with bad credit, including:
- What credit card benefits are there? Is it right for you?
- Can you get a credit card with bad credit?
- What steps do you need to take to get a credit card with bad credit? Good credit?
- How do you apply for a credit card with bad credit or good credit?
Before you know it, you will know exactly what you need to do in order to apply for a credit card for bad credit or good credit this year.
Credit Card Benefits
Before we even get into how to apply for a credit card with bad credit or good credit, we should see if applying is even a good idea.
In a world where we hear much talk about the negative side of debt, sometimes credit cards get pegged as a bad financial move. You may be wondering why you should even apply for a credit card.
When used wisely, there are many ways that credit cards can benefit and even improve your finances. Here is a list of common general credit card benefits.
- Ease of spending
- Ability to build credit score
- Opportunity to earn perks, like cash back or travel rewards
- Peace when traveling versus carrying cash
- Fraud protection/zero liability
If you are unsure of whether or not you would like to apply for credit cards, some of these reasons may persuade you that it is the right choice for you.
Can You Get a Credit Card with Bad Credit?
Our discussion here will center around how to get a credit card with bad credit and good credit. However, many people may wonder, “Can you get a credit card with bad credit?”
The short answer is, yes! But that does not always mean it is enitrely easy to get a credit card with bad credit. You may never get high limit credit cards, but getting an actual credit card is still possible.
Most credit card companies do not want to “loan” you money on your card if you have never proven your creditworthiness or have shown late payments/missed payments too many times.
However, since you need that credit card in order to boost your score, some companies will offer options for you to apply for credit cards with bad credit. Many times, these do come with higher annual percentage rates (APR) or fees.
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How to Apply for a Credit Card with Bad Credit or Good Credit
Now that we understand some credit card benefits and we know that you can indeed get a credit card with bad credit, it is time to focus on the process of how to apply for a credit card with bad credit or good credit.
There are five main steps in the process you need to go through in order to get a credit card for bad credit or good credit. We will point out any important differences when it comes to those with no credit score/bad credit score and those with a good credit score/excellent credit card score.
The five steps to apply for credit cards with bad credit or good credit are:
- Know your credit score
- Research types of credit cards
- Choose your card
- Fill out a credit card application
- Wait for results
Let’s break these steps down even further so you can apply for credit cards with bad credit or good credit for this year.
Know Your Credit Score
The first and most important step when you apply for credit cards is to know and understand your credit score. Your credit score affects two major topics when it comes to a card application:
- Types of Credit Cards: Some cards are only for excellent credit, some are for fair to great credit, and others are for bad credit. When you know your score, you can apply for a credit card that fits your profile.
- Your Annual Percentage Rate (APR): Most credit cards have APR ranges, otherwise known as your interest rate. For example, the Citi Simplicity® Card is between 13.24%–23.24%. When you apply for credit cards, the higher your credit score, the lower your APR.
Image Source: Citi
Since your score is so important, it is the main factor when you apply for a credit card with bad credit or with good credit.
Know that not every credit bureau categorizes credit scores in the same exact way. This list of ranges from Credit Sesame is simply a guide to know approximately where you fall on the credit score scale.
- Bad Credit Score: 550 or lower
- Poor Credit Score: 550–659
- Fair Credit Score: 650–699
- Good Credit Score: 700–749
- Excellent Credit Score: 750 or higher
Research Types of Credit Cards
After you understand how your credit score will impact whether you apply for a credit card with bad credit or good credit, your next step is to start research. First, figure out what types of credit cards will be best for you.
Credit Cards Explained: Types of Credit Cards
Here are a few common types of credit cards you may consider. We have marked a few options if you want to apply for credit cards with bad credit:
- Cashback Credit Cards: Earn some cash back when you use your credit card for your purchases. Often for good credit, but there are exceptions.
- Rewards Points Credit Cards: Earn points that can be redeemed for gift cards, merchandise or more. Often for good credit, but there are exceptions.
- Travel Miles Credit Cards: Earn travel miles for flights or hotel stays when you use your credit card. Often for good credit, but there are exceptions.
- Student Credit Cards: Available for college students who need a first credit card with low fees. Often for those with no credit or even bad credit.
- Low APR Credit Cards: Keep a low interest rate as you pay off the balance on your credit card. Often for good credit, but there are exceptions.
- No Fee Credit Cards: Have low or no annual fees, foreign transaction fees, and more. Often for good credit, but there are exceptions.
- High Limit Credit Cards: Have access to some of the highest credit limits available with high limit credit cards. Often for those with excellent credit.
- Secured Credit Cards: Raise your credit score by giving a collateral deposit. For those with no credit or bad credit.
Choose Your Card
The next step when you apply for credit cards with bad credit or with good is to simply choose your card.
Once you know which types of credit cards appeal to you and/or will work best for you, you can filter your research down to searching for the top card. If you have excellent credit, you can easily pick the one you would like. If you have bad credit, make a list of two or three options.
You do not need to have any accounts at the bank you choose to apply for a credit card with bad credit or good credit. For example, you do not need to have a Bank of America checking account in order to apply for the BankAmericard® Cash Rewards™ Credit Card.
Image Source: Bank of America
However, sometimes, banks do offer perks for account users. In the case of the BankAmericard® card, if you deposit your cash rewards into your Bank of America checking or savings account, it gives you an extra 10% bonus.
Fill out a Credit Card Application
Now that you know your score and which card works best for you, it is time to apply for a credit card. Whether you apply for credit cards with bad credit or good, the process is the same: a credit card application. But what should you expect from this process?
Credit Cards Explained: Applications
Most of the time in today’s world, a credit card application will be filled out online. At times, applications may be sent by mail. It is even possible to fill out a credit card application in-store.
A credit card application includes basic information such as:
- Social Security number
It is important to be as honest as possible about each of these factors, especially the income. Do not be tempted to overinflate your income for a better chance to get a credit card with bad credit. You could be seriously fined or even imprisoned.
Wait for the Credit Card Decision
Once you have filled out your credit card application, it is now out of your hands. You know wait and see if you can get a credit card for bad credit or good credit. But how long does it take?
The credit card processing could be instant. Some companies will let you know right after you submit your application.
For others, credit card processing could take weeks. This may be your experience if you apply for credit cards with bad credit or if there are questions about your income or information.
If you are approved after the credit card processing, you will also learn what APR the credit card company is offering you. At this point, you simply wait for the credit card to arrive. Then you can begin using it and all of its credit card benefits.
Other Options to Get a Credit Card with Bad Credit
While this article is also for those with good credit who want to apply for a credit card, we have a few extra tips for those with bad credit. It may be a more difficult process, so here are a couple ways you can apply for credit cards with bad credit more easily.
- Apply for credit cards that are secured: As we mentioned this in our types of credit cards, secured credit cards allow you to put up your own collateral payment. When you make payments each month, they get reported to credit bureaus and will raise your credit. This way, you can build up that credit enough to get a decent card with many credit card benefits.
- Get a co-signer: A co-signer with good credit can add weight to your credit card application. However, if you fail to pay the payments, the co-signer will be responsible. This can make it hard to find good co-signers.
Conclusion: Now You Can Apply for Credit Cards with Bad Credit or Good Credit
Now you should know the five steps you need to take in order to apply for a credit card with bad credit or with good credit.
To start you off check your credit score for free with one of the credit bureua agencies: Equifax, Experian, or TransUnion. You can get one free report from each agency each year.
Then, find the best credit card option for you, and get a credit card with bad credit or good credit that you can use and benefit from this year.
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