This fact cannot be denied that since the time credit cards have been introduced in the market, they have made an individual’s life quite easier in respect to where they can purchase products that they immediately need and pay for them at a later date. But this feature of credit cards is also one of the main reasons behind the decline in an individual’s credit score. Sometimes the individuals fail to pay the bill amount on the due date and hence it creates a negative impact on the credit score. A credit score is one of the major factors on the basis of which the banks decide whether or not they will issue a credit card to an individual. An individual who has a credit score of 750 and above is considered a good credit score and the individuals who possess this credit score are offered the best credit cards in the market.
Any score below 750 and above 600 is also a decent credit score and you may get a few options of credit cards that fall in this range. But any score below 600 is not considered a good score and it gets extremely difficult for you to get a credit card issued with such a score. Though it gets difficult, it is not impossible to get a credit card with a bad credit score. There are banks that offer a few credit cards which are to be issued to individuals who have a bad credit score. In this article, we will discuss the reasons behind a bad credit score and how to get approved for a credit card with bad credit.
Reasons for bad credit score
It is quite important for an individual to have a good credit score but it sometimes gets difficult to maintain a good credit score. The falling are the reasons because of why an individual might have a bad credit score –
- Delayed bill payment is one of the major factors that affect your credit score adversely. All the bills and EMI’s should be paid well in time if you want to maintain your credit score.
- Whenever whether intentionally or unintentionally, if you make any default while paying your bills, it will have a negative impact on your credit score.
- Sometimes, your credit card bills rise too much that it becomes difficult for you to pay off such bills, hence, you request the credit card issuer for credit card bill settlement. Now when your credit card bill is settled instead of cleared, it will again have a negative impact on your CIBIL score.
These are a few reasons which can have a bad impact on your credit score.
How to Get Approved for a Credit Card With a Bad Credit Score
A credit score is a major deciding factor behind the issuance of a credit card. If you have a good credit score, you will have a pool of options available out of which you can choose the best credit card for you. But if you have a bad credit score, it is very difficult for you to obtain a credit card, and even if you do get one, it will just be an entry-level credit card with some basic features and no value-added benefits.
Learn here: Everything You Need To Know About Credit Score
- Apply for a secured credit card – The best and safest option for people who do not have a credit score or have a bad credit score is to apply for a secured credit card. A secured credit card is nothing but a credit card against a fixed deposit. All you have to do is to open a fixed deposit with the bank with which you would like to apply for a credit card. The bank will then issue you a credit card against your fixed deposit with a credit limit of 50% to 100% of the total value of the fixed deposit. You can then use this credit card to make your purchases and you will have to repay the bill on time so that it will help you in improving your credit score. Any default made towards the payment of the credit card will be recovered by the bank from the fixed deposit against which the credit card has been issued to you.
- Apply for an add-on credit card – This is a good option if you have a bad credit score. For applying for an add-on credit card, you will need to have a primary applicant in your family. You can avail the advantage of having an add-on credit card through the primary applicant’s account. The add-on credit card will have similar features and benefits as that of the primary card. But the credit limit will be shared now which means that after the issuance of the add-on card, the credit limit on the primary card will now be shared by the add-on card as well.
Credit scores play a very important role in determining an individual’s eligibility to have a credit card. On the one hand, where a good credit score enables an individual to choose from a variety of credit card options available, on the other hand, a bad credit score makes it difficult for an individual to even have a credit score. Though a few options like a secured credit card or an add-on credit card can be considered, these won’t give similar benefits as compared to normal credit cards. Hence an individual should always try that his credit score does not get affected because of any of his inappropriate activities and he should adhere to the deadlines of the bill payments for a good credit score.