Credit Card

How Do You Apply for a Credit Card With a Low Credit Score?

Applying for a credit card is an easy way to get extra money. You can use it when you miss a few days of work, or you need some extra cash. Anyone who applies for a credit card must go through the full application process. The company will look at their credit history and see their credit score, which will determine both if they get the card and how much they can spend with the card. Those with higher credit scores should have no problem getting a new card. Applying for a credit card with a low credit score requires a little more work.

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What is a Credit Score?

The bureaus that report and keep track of credit reports give users a score that can hit 800 or higher. Those with a poor history of paying off their debts will have a lower credit score, which can drop into the 300s. There is even a chance that some users may not have a credit score because the bureau can not find enough information to assign them a score. On the FICO scale, a bad credit score is 670 or lower. Some lenders view a bad credit score as one under 500 or 550.

But, does applying for credit card hurt credit? The answer is, yes. According to the financial experts at SoFi Invest, this will usually only hurt you if the lender does a hard credit check. A soft credit check might occur when a lender you already work with wants to verify your credit score. It will not damage your score. Lenders do a hard credit check before they extend a new line of credit, such as a credit card. This can drop your score by a few points and will stay on your credit report for a year.

Applying for a New Card with Bad Credit

Though it’s hard to get a new credit card with a bad credit score, it’s not impossible. Secured cards are a good option. They require that the borrower put down a deposit such as $200. The consumer can then spend all of the money on the card and add more money as they need it. Another option is a subprime credit card, which is one designed for someone with bad credit. This type of card usually has a higher interest rate but allows users to rebuild their credit and work on improving their scores. There are also cards that assign users a limit based on factors such as how much they make each year and whether they own or rent. These cards increase the limits of users as they improve their credit.

It’s possible to get a credit card with a bad credit score because of subprime and other types of cards. Consumers with a credit score of 550-670 or lower will find that they have a harder time getting a credit card.

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