Can I get a credit card with bad credit?
If you’ve been refused credit elsewhere it may be because you have a bad credit rating. Your credit rating could be impaired for a variety of different reasons, for example if a few setbacks caused you to miss payments on other debts and a default was registered on your credit history.
However, a poor credit rating today need not mean you can never access credit. It is possible to take steps today towards rebuilding a credit rating with Vanquis. A Vanquis Bank Credit Card as well as providing access to credit now, if used responsibly may help with improving your credit rating for the future.
Vanquis Bank is a UK based credit card company that has provided credit card facilities to over 3 million people+ so far.
Vanquis offers an easy to use credit card that may be available for people with bad credit history.
Why do I have a bad credit rating?
When you apply for credit, your application will typically be checked against the records held by credit reference agencies such as Experian and Equifax. These checks let a lender know whether a person has missed credit card payments, had county court judgments (CCJs) for non-payment of bills or debts (including credit cards) or been declared bankrupt.
It’s when a person is rejected for credit that they usually realise that they have a bad credit rating. Typically this is because that person:
- May not have managed credit responsibly in the past, having missed payments or made payments late
- Has gone overlimit on credit cards, storecards or other credit accounts
- Missed payments on mortgages or other loans
- Had a CCJ, bankruptcy or Individual Voluntary Arrangement (IVA) against their name in the last six years
In addition to the above factors, it can be difficult to get credit if a person has:
- Low household income
- Moved home often or recently moved to the UK so the lender cannot verify address details
- Not registered on the electoral roll
This may mean that a person’s access to credit is limited. This is where Credit Cards for Bad Credit History such as Vanquis may be able to help.
The Extent of Bad Credit in the UK
It is estimated that around one in five UK adults may have a bad credit history. A bad credit rating can be a result of careless financial management but is often a sad consequence of events that are beyond a person’s control such as redundancy, bereavement or divorce.
According to The Money Charity, in July 2017:
- Outstanding unsecured consumer credit amounted to £199.7 billion
- Average UK consumer credit debt per household was £7,370
- The average amount owed by each UK adult (including mortgages) was £29,698, about 113% of average earnings
As Britain’s economy has struggled, the potential for debts to turn into a bad credit history has increased. The Money Charity found that:
- 1,000 people a day reported they had become redundant between February to April 2017
- 248 people were declared insolvent or bankrupt every day
- 3,321 Consumer County Court Judgments (CCJs) were issued every day, with an average value of £1,495
- The Citizens Advice Bureaux in England and Wales dealt with 3,473 new debt problems every working day during April 2017
Unfortunately as a result of these developments more people suffer from bad credit, really bad credit or a very bad credit history. If you are looking to rebuild credit, Vanquis may be able to help even if other credit card providers have refused your application.
How do I repair my credit rating?
Unfortunately, many people do not realise the importance of a good credit history until it is too late with the consequence that they are turned down for loans, mortgages and credit cards or not offered better terms.
However, if you have a bad or poor credit history there are steps you can take to start improving the situation. Steps include:
- Carrying out a credit check with a Credit Rating agency to understand your credit position
- Assess your income and expenditure to understand how you can reduce your costs and see how much money you have available
- Prepare a budget and carefully manage your expenses
- Collect all the bills and outgoings that must be paid and diarise when to pay these and/or set up standing orders to be sure not to miss any payment deadlines
The Vanquis Credit Card is rated 8.9 out of 10 by TrustPilot.co.uk based on 2968 reviews.
(data as of June 2017)