Ever tried to open a bank account or rent a car where
the first requirement is to hand over your credit card? At many
of the major car rental agencies even if you just want your friend
to share driving duties, they'll have to show some proof of their
credit existence via a little plastic card - and it had better not
be of the debit variety. In order to do many mundane activities
lately, a credit card is almost a necessity.
Some people just prefer the practicality of not carrying
cash around all the time.
For still others there's
the peace of mind that comes from having credit readily available in an emergency.
But for the credit destitute, plastic is hard to come
by.
Not everyone has offers from credit lenders stuffing
the mailbox. In fact, those with bad, little or no credit history
may be yearning for even a single offer -- any offer -- to arrive
one day.
When it finally does -- or when you head out in search
of credit -- the "deals" can seem like anything but. First
of all, high annual percentage rates, to the tune of 18 percent,
20 percent and 22 percent, or more, are common on credit cards offered
to those with poor credit.
The 9.9 percent APR for a card geared toward getting
credit "back on track" seems like a lucky break -- until
the eye meets the fees list you're likely to encounter:
-
$29 for account set-up
- $95 program fee
- $48
annual fee
- $72 participation fee
- $20 annual per-card fee for additional cards
- $25 fee for each
approved credit limit increase
"Look at it from
the bank's perspective," says Tracey Mills, a spokeswoman for the American
Bankers Association. "High risk equals high cost. The riskier you are,
the higher you'll pay for credit."
But if you're willing to pay, that piece of plastic
can be yours. "You can have pretty much the worst credit in
the world and still get a credit card these days," notes Richard
M. Krawczyk, publisher of The
Financial Fitness Tips.com Report newsletter.
Credit cards are available even for those who have
hit financial rock bottom.
"One of the biggest surprises for consumers who've
been through bankruptcy is how easy it is afterward to regain credit,"
says Gerri Detweiler, author of The
Ultimate Credit Handbook: How to Cut Your Debt and Have a Lifetime
of Great Credit, now in its third edition.
Where to find them
If you don't receive any offers in the mail, or if the rates and
terms are unacceptable, there are many places you can search for
the best possible deal -- online, by phone or in person at your
local bank branch. Bankrate provides readers with interactive tools
that enable you to search for low
interest rate cards, as well as no
annual fee cards; secured
cards; student
cards and rebate
or frequent-flier cards. There are many more online sites you
can use to search for your best possible deal.
"With
more than 6,000 lenders out there, chances are most people would qualify for some
type of card," Mills says.
Lenders will extend a credit hand to nearly anyone,
often hoping for a long-term relationship. HSBC Bank Nevada is a
good example. Their Orchard Bank MasterCard Classic "is a bridge
card that enables customers who have less than perfect credit or
no credit to speed their movement along the credit spectrum,"
says HSBC representative Rahsaan Johnson. "It gives us ... an
opportunity the reach the customer early in the process of building
or rebuilding their credit. So when they're ready for a car loan
or a mortgage loan, they have a history of working with us, and
we hope that they will continue to do so."
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