The most important thing to look for in a bad credit credit card is its fees, but you should also check its APR, minimum and maximum security deposits, and what kind of credit limit you can expect. Here is an explanation of each item.
Most credit cards have fees, but what you don’t want are inevitable fees. Fees for cash advances or balance transfers shouldn’t scare you off of a specific credit card – you can easily avoid both by not doing these types of transactions.
The fees that should make you think twice are the annual fee, monthly maintenance fee, and any other regular fees charged by the card issuer no matter what. These are expenses you don’t need, especially for a card that probably doesn’t have a lot of benefits.
Ideally, you’ll pay your statement balance in full and never incur interest charges. But it’s also good to have a credit card that won’t cost you interest if you ever need to have a balance.
Minimum / maximum security deposit
With secured credit cards, you need to check the minimum and maximum amounts of security deposits. Which one is most important to you depends on how much you have saved for a security deposit.
If you don’t have a lot of savings, you’ll need to make sure you can afford a card’s minimum deposit amount. If you have strong savings and want to pay more up front for a higher credit limit, you’ll need a card that allows for a high maximum deposit.
If possible, you should research the credit limits offered by a card. This information is usually available with secured credit cards, but sometimes you can get it for an unsecured card as well.
You don’t need a ton of available credit. But if your credit limit is too low, it can be difficult to keep your credit usage low, which can affect your credit score.