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5 Credit Card Bonuses for Bad Credit (2019)

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Folks with bad credit frequently assume they are consigned to no-frills credit cards, if they can get a card at all. We’re happy to report that you may be able to do better with a credit card that offers bonuses for bad credit.

The credit cards in this review give you additional value despite your low credit score. Plus, by using your credit cards responsibly, you have the opportunity to boost your credit score and qualify for cards with fancier benefits.

Cards | Approval Tips | FAQs

Bonus rewards are good, even if they are modest. These credit cards find a way to give you some kind of bonus, even if you have bad credit.

  • Seeing if you Pre-Qualify is fast, easy, and secure
  • Get 1% cash back rewards on eligible purchase, terms apply
  • Rewards post automatically to your account each month
  • Automatic reviews for credit line increase opportunities
  • With $0 Fraud Liability, you won’t be responsible for unauthorized charges
  • Pick a card that fits your style. Multiple card designs are available, a fee may apply

N/A

N/A

19.49% to 25.49% Variable

$0 – $99

Poor

The Credit One Bank® Unsecured Platinum Visa® card lets you earn 1% cash back on eligible purchases. Moreover, the card offers three additional bonus rewards.

First, you can earn 1.1% cash back on purchases from certain eligible merchants. Second, you will be automatically evaluated for a higher credit limit if you pay your bill on time for the first five months. Third, you can access the More Cash Back Rewards Program to get discounts and extra benefits from participating merchants.

BAD CREDIT RATING

★★★★

4.3

  • See if you Pre-Qualify in less than 60 seconds—without affecting your credit score. It’s fast, easy, and secure.
  • Get 1% cash back rewards on eligible purchases including gas, groceries, and services such as mobile phone, internet, cable and satellite TV. Terms apply.
  • This is a fully functional, unsecured credit card—not a debit card, prepaid card, or secured credit card with deposit requirements.
  • Credit One Bank evaluates every account for credit line increase opportunities. We’ll let you know as soon as you’re eligible for a higher credit line.
  • Take advantage of free online access to your Experian credit score and credit report summary so you can track the key factors impacting your credit health. Terms apply.
  • Zero Fraud Liability protects you if your card is ever lost or stolen. Rest easy knowing you won’t be held responsible for unauthorized charges.

N/A

N/A

19.49% to 25.49% Variable

$0 – $99

Poor Credit

You can track your Experian credit score online for free with the Credit One Bank® Visa® with Free Credit Score Tracking. The card pays 1% cash back on eligible purchases and provides $0 fraud liability.

As a bonus, you get 10% more cash back rewards, a rate of 1.1%, for purchases from participating merchants. Credit One will periodically review your creditworthiness to see whether you qualify for credit limit increases.

BAD CREDIT RATING

★★★★

4.0

  • Find out if you Pre-Qualify without harming your credit score
  • Eligible purchases earn 1% cash back rewards automatically, terms apply
  • Get a credit line between $300 and $3,000 based on your credit history
  • Accounts are automatically reviewed for credit line increase opportunities
  • Choose your monthly payment due date for added convenience, terms apply
  • With $0 Fraud Liability, you won’t be responsible for unauthorized charges

N/A

N/A

19.49% to 25.49% Variable

$0 – $99

Bad Credit

The Credit One Bank® Unsecured Visa® for Rebuilding Credit pays you 1% cash back on eligible purchases and 1.1% on purchases from selected merchants. It reports your credit activity to the three major credit bureaus monthly, which gives you the opportunity to rebuild your credit.

The card offers credit lines from $300 to $3,000, and you can increase your line by demonstrating creditworthy behavior, such as paying your bills on time.

BAD CREDIT RATING

★★★★

3.9

  • No Annual Fee, earn cash back, and build your credit with responsible use.
  • It’s a real credit card. You can build a credit history with the three major credit bureaus. Generally, debit and prepaid cards can’t help you build a credit history.
  • Establish your credit line by providing a refundable security deposit of at least $200 after being approved. Bank information must be provided when submitting your deposit.
  • Automatic reviews starting at 8 months to see if we can transition you to an unsecured line of credit and return your deposit.
  • 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases every quarter, automatically. Plus, earn unlimited 1% cash back on all other purchases.
  • Get 100% U.S. based customer service & get your free Credit Scorecard with your FICO® Credit Score

N/A

10.99% for 6 months

24.49% Variable

$0

New/Rebuilding

The Discover it® Secured card provides 2% cash back on up to $1,000 in quarterly purchases at gas stations and restaurants. All other purchases earn 1% cash back.

The bonus with this card is an unlimited Cashback Match on all cash back you earn during the first year after opening the account. As a secured card, you make a refundable deposit to cover your credit limit. Over time, you may graduate to an unsecured card. This card also lets you view your FICO score for free.

BAD CREDIT RATING

★★★★★

4.7

  • Easy application! Get a credit decision in seconds.
  • Build your credit history – Fingerhut reports to all 3 major credit bureaus
  • Use your line of credit to shop thousands of items from great brands like Samsung, KitchenAid, and DeWalt
  • Not an access card

N/A

N/A

See Issuers Website

$0

Poor Credit

Payments you make on your Fingerhut Credit Account earn 10% toward Payment Rewards. Your rewards accumulate unlimited during a three-month period and you receive them at the end of the period.

You can redeem your rewards for new Fingerhut purchases from your credit account. You must redeem the rewards during the next three months or else they will expire. In addition, you’ll receive a free updated FICO score each month.

Bad credit need not prevent you from obtaining a credit card. Here are some tips to improve your chances for approval:

  1. Pick the right card: Certain credit cards, including the ones reviewed here, are specifically geared toward consumers with bad credit. These cards look beyond credit scores to see whether you have enough income to qualify for credit. Typically, these cards have modest credit limits and, unless secured, higher APRs. They may also have higher fees.
  2. Apply for a secured card: A secured card is fairly easy to get because you have to deposit cash into an account that acts as collateral on your card usage. If you ever miss a payment or go beyond your limit, the issuer will take the money from your collateral account and may charge fees, increase your APR, reduce your credit limit, or cancel the account. Many issuers let you replace your secured card with an unsecured one after you exhibit creditworthy behavior for a set period.
  3. Become an authorized user: Friends or family members can add you to their credit cards as an authorized user. You get your own copy of the card which you can use as if you were the card owner. You may be able to improve your credit score. If all payments are timely. The card owner is ultimately responsible for all payments.
  4. Start a credit-builder account: Many credit unions offer credit-builder accounts that allow you to build your credit and make it easier to get a credit card. In a credit-builder account, you take out a collateralized loan by depositing the loan proceeds into a locked account. You then repay the loan in monthly installments. Once repaid, your collateral is released back to you. By repaying on time, your credit score should eventually improve.
  5. Fix mistakes on your credit reports: You can get free credit reports annually and dispute any errors you find. If the credit bureau agrees and removes a derogatory entry on the report, your score should immediately improve.

By taking steps to improve your credit, you can access more generous credit cards and qualify for higher credit limits and/or lower APRs.

Credit card issuers compete for new cardholders in several ways, including signup bonuses. There are a few types:

  • Bonus rewards: This kind of introductory bonus is available to new cardholders who spend a specified amount on purchases during the first few months after opening the account. Bonus amounts vary by card and the credit score required to get the card. You collect the bonus — cash back, miles, or points — after you meet the minimum spending amount required to achieve the bonus.
  • Bonus rates: In this type of bonus, you get a special APR, often 0%, for a set number of months after opening the account. The bonus may apply to purchases, balance transfers, or both. In the case of balance transfers, a fee will apply for each transfer. Your APR reverts to normal after the bonus period ends.
  • Cashback Match: The Discover it® Secured card and other Discover cards are famous for their Cashback Match program. The match is available only to new cardmembers at the end of the first year, when you receive a match of all the cash back you earned during the year.
  • Waived fees: Some cards waive certain fees, such as annual fees, cash advance fees, or monthly maintenance fees, during the first year after opening the account.

Whatever form they take, bonuses sweeten credit card usage after opening a new account. Remember, you must be a new cardholder to obtain introductory bonuses.

Obtaining a credit card is a neutral event — it won’t significantly help or hurt your credit score. What counts is how you use it.

Responsible use of credit is the key to improving your score. Here are five tips:

  1. Pay your bills on time, every time. Failure to do so will only hurt your score. If your payments fall behind by 90 days or more, you will be considered delinquent and may be put into collections. That will make a substantial and long-lasting impact on your credit score. If you pay on time and pay at least the minimum amount due (hopefully, you’ll pay more than that) for several months in a row, you could see your score start to rise.
  2. Control your credit utilization ratio (CUR). This is the amount you owe divided by the amount of credit available to you. Typically, you want to keep your CUR below 30%, but getting down to 20% can help improve your credit score. Consider paying off one or more of your credit cards, perhaps with the help of balance transfers to consolidate your debt.
  3. Keep old accounts, even if dormant. Your credit score improves as your accounts age. Closing accounts can lower the average age, and it also reduces your available credit, which can increase your CUR and hurt your score.
  4. Increase the mix of your credit sources. Instead of opening another credit card account, consider a personal loan or home equity line of credit. A wider range of credit types can help your score.
  5. Refrain from multiple new credit applications within a short period (say, 60 to 90 days). Each application causes a potential creditor to inquire about your credit history. Multiple inquiries in a short period can hurt your score, so spread them out throughout the year.

The most important single thing to do is to check your credit reports from each of the three credit bureaus for errors and correct them. This can immediately improve your score.

A secured card is a great option if you have bad credit, but it is by no means your only one. The cards reviewed here, as well as others we have reviewed, are specifically geared to folks with bad credit.

A secured card requires you sock away cash in a locked bank account to collateralize your credit card. For many, this is unrealistic. If so, you may consider cards such as the Credit One® Bank Unsecured Platinum Visa®. It offers cash back on your purchases and other benefits not always found with credit cards aimed at bad credit consumers.

Store cards like the Fingerhut Credit Account are usually easy to obtain. They have tight credit limits and can be used only at the specified store(s). By using these cards responsibly, you can build your credit scores and may eventually qualify for cards with more benefits.

Minimum Age for Authorized Users by IssuerAs mentioned earlier, becoming an authorized user of another person’s credit card is a quick option to access credit despite a low score. You can use the card as your own up to the credit limit, and ultimately it is the card owner, not you, who is responsible for making payments.

However, you should, by all means, use the card responsibly and within the parameters set by the card owner. The credit scores of both you and the owner ride on creditworthy behavior, which gives you the opportunity to boost your score to the point where you can qualify for your own card.

In any event, it is bad form to do anything that will hurt the card owner’s credit, to say nothing of the toll it will take on your relationship.

You can get a credit card even if your credit is bad. As this review shows, you may even get one that offers bonus rewards.

Although rare, credit card bonuses for bad credit exist and the cards offer significant benefits. Best of all, they can help build your credit, thereby preparing you for cards with higher credit limits and more generous benefits.



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Bad Credit

How Do I Sell My Vehicle With Joint Ownership?

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A joint auto loan is when two borrowers have rights and responsibility to the same vehicle and loan. If you have a cosigner, then you, the primary borrower, have all the rights to the vehicle. Here’s what you need to know when you need to sell your car with two people responsible for the loan.

Selling a Joint-Owned Vehicle

Joint owners are typically spouses or life partners who combine their income to meet income requirements or get a larger loan amount. Both co-borrowers are responsible for paying the car loan and have 50/50 rights to the vehicle, so both their names are listed on the title.

Since your co-borrower has the same rights and obligations to the vehicle as you, you must get their permission to sell the car. In most cases, they also need to be present for the sale to sign the title. This may not always be the case, though, so it’s important to know how to read your car’s title.

If you have it, take a look at your vehicle’s title for the names listed on the back where you sign to transfer ownership. For example: let’s say your name is Jane and your co-borrower’s name is Joe. You’re likely to see either:

  • “Jane and Joe”
  • “Jane or Joe”
  • “Jane and/or Joe”

If you see “and/or” or the connector “or”, this typically means only one person needs to be present for the sale of the car. But if you see “and” this means both of you need to be present to transfer ownership – this is usually the case with joint ownership.

In all three cases, you still need the permission of the co-borrower to sell the vehicle even if they don’t have to be physically present to sign the title. If you sell it without the co-borrowers consent, it may be considered a crime because it’s their property, too. Moving forward, discuss the sale with your co-borrower to avoid potential legal trouble.

Selling a Car With a Cosigner

How Do I Sell My Car With Joint Ownership?If you have a cosigner on your car loan, then things become easier. A cosigner doesn’t have any rights to the vehicle and their name isn’t on the title. Their purpose is to help you get approved for the auto loan with their credit score, and by promising the lender to repay the loan if you’re unable to. A cosigner can’t take your vehicle, sell it, or stop you from selling it yourself.

However, it’s nice to let them know if you do decide to sell the car because the auto loan is listed on their credit reports. If you can, reach out to them about your plans to sell the vehicle. The car loan’s status impacts them and could affect their ability to take on new credit when it’s active.

If you sell the vehicle and the lien is successfully removed from the title, then you’re both in the clear.

Removing the Lien From a Vehicle’s Title

If you still have a loan on your car, then your number one priority is paying off your lender. Your lender is the lienholder, and you can’t sell a vehicle without removing them from the title – they own the car until you complete the loan. This typically means paying off the loan balance until naturally during the loan term, or getting enough cash to pay it all off at once from a sale.

When you’re selling a car with a loan, you want to get an offer for your vehicle that’s large enough to cover your loan balance and to remove the lien. If you don’t get a large enough offer, then you need to pay that difference out of pocket before you can sell the vehicle. Or, you may be able to roll over the remaining loan balance onto your next car loan if you’re trading it in for something else.

Looking to Upgrade Your Ride?

Many borrowers ask for help to get the car they need. If you need more income on your loan application to meet requirements, asking a spouse or life partner to chip in can do the trick. If you have a lower credit score, then a cosigner with good credit could help you meet credit score requirements.

But what if you want to go it alone on your next auto loan and your credit isn’t great? A subprime lender could be the answer. Here at Auto Credit Express, we’ve been connecting credit-challenged consumers to dealerships with bad credit resources for over two decades, and we want to help you too.

Fill out our free auto loan request form and we’ll look for a dealer in your local area that’s signed up with subprime lenders. These lenders assist borrowers with many unique credit circumstances to help them get the vehicle they need. Get started today!

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Fixed-rate student loan refinancing rates sink to new record low for the second straight week

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Our goal here at Credible Operations, Inc., NMLS Number 1681276, referred to as “Credible” below, is to give you the tools and confidence you need to improve your finances. Although we do promote products from our partner lenders who compensate us for our services, all opinions are our own.

The latest trends in interest rates for student loan refinancing from the Credible marketplace, updated weekly. (iStock)

Rates for well-qualified borrowers using the Credible marketplace to refinance student loans into 10-year fixed-rate loans hit another new record low during the week of May 3, 2021.

For borrowers with credit scores of 720 or higher who used the Credible marketplace to select a lender, during the week of May 3:

  • Rates on 10-year fixed-rate loans averaged 3.60%, down from 3.69% the week before and 4.32% a year ago. This marks another record low for 10-year fixed rate loans, besting the previous record of 3.69%, set last week.
  • Rates on 5-year variable-rate loans averaged 3.19%, down from 3.23% the week before and up from 3.04% a year ago. Variable-rate loans recorded a record low of 2.63% during the week of June 29, 2020.

Student loan refinancing weekly rate trends

If you’re curious about what kind of student loan refinance rates you may qualify for, you can use an online tool like Credible to compare options from different private lenders. Checking your rates won’t affect your credit score.

Current student loan refinancing rates by FICO score

To provide relief from the economic impacts of the COVID-19 pandemic, interest and payments on federal student loans have been suspended through at least Sept. 30, 2021. As long as that relief is in place, there’s little incentive to refinance federal student loans. But many borrowers with private student loans are taking advantage of the low interest rate environment to refinance their education debt at lower rates.

If you qualify to refinance your student loans, the interest rate you may be offered can depend on factors like your FICO score, the type of loan you’re seeking (fixed or variable rate), and the loan repayment term. 

The chart above shows that good credit can help you get a lower rate, and that rates tend to be higher on loans with fixed interest rates and longer repayment terms. Because each lender has its own method of evaluating borrowers, it’s a good idea to request rates from multiple lenders so you can compare your options. A student loan refinancing calculator can help you estimate how much you might save. 

If you want to refinance with bad credit, you may need to apply with a cosigner. Or, you can work on improving your credit before applying. Many lenders will allow children to refinance parent PLUS loans in their own name after graduation.

You can use Credible to compare rates from multiple private lenders at once without affecting your credit score.

How rates for student loan refinancing are determined

The rates private lenders charge to refinance student loans depend in part on the economy and interest rate environment, but also the loan term, the type of loan (fixed- or variable-rate), the borrower’s credit worthiness, and the lender’s operating costs and profit margin. 

About Credible

Credible is a multi-lender marketplace that empowers consumers to discover financial products that are the best fit for their unique circumstances. Credible’s integrations with leading lenders and credit bureaus allow consumers to quickly compare accurate, personalized loan options ― without putting their personal information at risk or affecting their credit score. The Credible marketplace provides an unrivaled customer experience, as reflected by over 4,300 positive Trustpilot reviews and a TrustScore of 4.7/5.

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Provident Financial calls time on doorstep lending business

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Provident Financial has confirmed plans to shut its 141-year-old doorstep lending arm, as its full-year results highlighted the strain the coronavirus pandemic and growing customer complaints have put on subprime lenders.

The Bradford-based company reported a pre-tax loss of £113.5m for 2020, compared with a £119m profit the previous year. The biggest drag was a £75m loss in its consumer credit division, which includes home credit.

Malcolm Le May, Provident chief executive, said: “In light of the changing industry and regulatory dynamics in the home credit sector, as well as shifting customer preferences, it is with deepest regret that we have decided to withdraw from the home credit market.”

Jason Wassell, chief executive of the Consumer Credit Trade Association, which represents alternative and high-cost lenders, said the decision showed that “the current regulatory framework does not work for the market, or its customers”.

“The result in this case is that access to credit will be reduced for hundreds of thousands of people.”

Provident built its name as a provider of home credit, or doorstep lending, which involves a team of local agents who regularly visit borrowers to collect repayments and discuss their products.

Proponents believed agents’ local expertise and personal relationships with borrowers allowed them to achieve better results than traditional bank lending to people with bad credit scores, but the approach has increasingly been superseded by digital models in recent years.

Provident’s business has also been affected by a series of self-inflicted and external difficulties. Its consumer credit division has been lossmaking since a botched effort to modernise the unit in 2017, which led to a pair of profit warnings and an emergency rights issue. More recently, its recovery has been hampered by an increase in customer complaints that prompted an investigation by the Financial Conduct Authority.

The complaints rise has been driven by professional claims management companies, echoing a broader trend across the subprime lending industry which has also affected companies such as Amigo, the guarantor lender. Executives also accuse the Financial Ombudsman Service, which adjudicates on customer complaints, of overstepping its mandate and encouraging huge volumes of complaints.

Provident said it would wind down or sell the consumer credit division, with either option expected to cost it about £100m. 

The move will see Provident exit the most controversial areas of high-cost credit to focus on what it describes as “mid-cost” lending through its Vanquis credit card business and Moneybarn vehicle finance arm. Vanquis and Moneybarn both remained profitable during 2020, despite more than a quarter of Moneybarn customers requesting payment holidays at the height of the pandemic.

The results were slightly better than average analyst forecasts, and the company said Vanquis and Moneybarn had both reported “improving trends” during the first quarter of 2021. Shares in Provident nonetheless dropped more than 10 per cent in early trading.

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