While unsecured credit cards for people with bad credit do not require a security deposit for approval and might therefore seem to be a more attractive option than secured credit cards, the absence of a deposit means that they tend to have high membership fees and actually represent a more expensive means of credit building. What’s more, unsecured credit cards for bad credit are not always available. In fact, they essentially disappeared following the enactment of the Credit CARD Act in February 2010, which capped the fees issuers could charge consumers, causing unsecured credit cards for people with bad credit to become unprofitable. Ultimately, regardless of whether bad credit unsecured credit cards are available at the present time or not, we recommend opening a secured card. Secured cards have much lower fees, offer essentially guaranteed approval, and allow you to increase your credit line at will by simply adding to your deposit. The more credit you have available, the more pronounced your credit score gains will be. In addition, keep in mind that from time to time there may be a few partially unsecured credit cards listed in the secured credit cards section. These cards will not only provide you with an unsecured line of credit (i.e. a credit line higher than your required deposit), but will also likely have the same low fees and minimal approval requirements as secured cards. If you end up opening any type of unsecured credit card, you must be careful to spend within your means because not doing so will not only prevent you from getting out of bad credit, but will also add to your troubles.
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