These days, it can be difficult to pay for certain things without a credit card. Even without the need to borrow money or the desire to build credit, having a credit card number is often needed for various types of purchases—for example, ordering something online. With bad credit, it can be difficult to qualify for a traditional credit card, or even open up a bank account and get a debit card. If you have poor credit and need a credit card, the following are some possible alternative solutions:
Get a prepaid card
Also known as reloadable cards, anyone can get a prepaid card as long as they have money to load onto it, and it doesn’t matter what their credit score is. They are similar to debit cards because the money you spend is your own, and there is never anything to pay back. Although you’ll receive statements that include details of your purchases, they aren’t bills and don’t require payments. Prepaid cards can be an ideal solution for someone who needs to use a credit card for specific types of purchases, but doesn’t want to risk getting into debt and doesn’t want to open up a card that affects their credit. Most prepaid cards include various fees, so be sure to do your research.
Opt for a secured credit card
Secured credit cards share some similarities with prepaid cards, but there are certain things that also set them apart. Although you’ll also make a deposit with a secured credit card, this deposit doesn’t become the money you have available to spend, but rather “secures” the credit card and is used as collateral. You are given a line of credit, and payments must be made just like with any other credit card. Once your balance is paid off in full and you close your account, you receive your deposit back. This can be a good option for those who are bouncing back from bad credit and are looking to rebuild it.
Apply for a store credit card
Even if your credit isn’t the best, you may still qualify for a department store credit card , as their acceptance criteria is often a little more lenient than traditional credit cards. However, do note that with very bad credit, you might not qualify. If you are approved, your credit limit might be low and you can usually expect to pay high interest. But if you’re looking for a way to begin building credit again and need an entry-level credit card, a department store credit card can sometimes be a good place to start.
Have someone add you to their card
If you have a family member or spouse with great credit, you might want to see if you can get added to one of their credit cards. If you just want to have a credit card for the sole purpose of improving your credit, this can help give your score a little bit of boost, even if you don’t have a copy of the card and charge on it yourself. As long as the balances are kept fairly low and payments are timely, simply being added as an authorized user can help to improve your credit score and could be another option to consider if your credit is poor and you don’t qualify for a traditional credit card. Of course, there is some risk in doing this as your credit could be affected if the cardholder fails to make payments.
Are you receiving structured settlement payments, but need to receive your money sooner? Peachtree Financial Solutions may be able to help. If you need cash to pay off debts, contact Peachtree today and find out how you can sell future payments for a lump sum of cash.
Nothing above is meant to provide financial, tax, or legal advice. You should meet with appropriate professionals for such services.