Like any credit card for bad credit, you should expect these cards to come with a high interest rate, potential annual fees, and other charges that can make them expensive options for rebuilding your credit score.
If you can afford a higher upfront cost, you may save a substantial amount of money by considering a secured credit card. These cards will require a refundable security deposit to open your account, but you’ll find that most have very low interest rates, and some won’t charge an annual fee for membership.
Even better, many secured credit card offerings won’t require a credit check for approval — so your previous financial mistakes won’t come back to haunt you.
Either card will report your payment history and balance to at least one credit bureau to help you improve your credit score with responsible behavior. You can speed up this process by making timely payments and paying your balance in full each month.
Not only does a low balance look good on your credit report, but it lowers your potential credit costs. You’ll pay interest to your credit card company for any credit card balance you carry from month to month. Your interest charges post to your monthly payment, which increases your unpaid debt and makes it harder to pay off your total balance.
This will also increase your credit utilization ratio and overall credit card debt, which makes up 30% of your overall FICO credit score. To read more click here