Having bad credit can be a really big problem. First off, it stains your reputation. Secondly, it can give you a hard time in settling some legal matters. However, contrary to popular belief, getting good credit cards offer is still possible even if you’ve got bad credit history. It can be achieved by either getting a secured or unsecured credit account.
Going For Unsecured Credit Accounts
Although it is possible to get this kind of account, you should realize that this would be harder to get compared to the secured type. This is because the only thing that your debtor can hold against you is the promissory note you signed to pay your debt.
You should be prepared for a long process of interviews and paper works, for you to get approved. Additionally, the interest rate that would be given to you might also be a bit higher compared to those with good records.
Improving Your Chances with Unsecured Accounts
There are two general ways to improve your chance of getting approved, you should have:
- a good standing checking account
- a non-evaded current loan
If you don’t have both, then it is best that you formulate a payment plan, so that you can bring yourself up and have good standing on both factors.
Having a repossessed property can be a big downfall in applying for unsecured loans. This is because it would reflect longer in your credit history. Try your best to get your property back, as soon as you can, before you apply for an unsecured credit account.
Going For Secured Credit Accounts
This kind of account wouldn’t charge you with extremely high interest rates. In fact, your rate, as a bad record holder, would be just the same with good record holders. The whole process of interviews and paper works would also be lesser this time.
However, the catch is that you would have to give the company some tangible property as a security that they would get paid. Signing an agreement or promissory note is not sufficient; you have to give them physical collateral at the very beginning. Collaterals can come in various forms, such as:
- Piece of land/property
- Car/s
- A bank account where they can automatically charge your debt
- An amount of money in any bank account equivalent to your credit limit
If ever you go for secured accounts, you should keep in mind that you would need extra discipline in paying your monthly dues. This is because you might lose those properties if you don’t pay them within the agreed period of time.
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