People having bad credit often remain unable to get credit cards. Their bad credit is the biggest hurdle in their way to get credit card.  Poor credit history reckons that a person was not consistent in making on time payments or he/she must have missed payments, went beyond their credit limits or may have filled for bankruptcy.

Why lenders avoid people with bad credit?

Usually, lenders avoid applicants having bad credit. The reasons are mentioned above that makes an applicant having bad credit unpopular in a lender’s eye.  Such people are regarded as the big risks for the money which they have been provided by the lenders.

Credit card companies

Credit card companies deal all applicants in the same way regardless of their good or bad credit history. On the contrary, people having bad credit history have to bear high interest rates on their loans. This is due the bigger risks which these applicants pose to lenders. Applicants should not take it personally and negatively because they are given with high interest rate due to their poor credit history. Apart from high interest rate, loan terms are limited and monthly payments are also high than that of normal loan.

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The first “Modern Credit Card” that can be used for paying parties other than the card issuer was started in 1950. It was issued by Diners Club in New York City. Initially they were issued to about two hundred people, most of them known to the owner. These were used mainly at the restaurants and were accepted at 14 places initially.

Since then there have been many developments in the credit card industry. Here is a choice of 10 interesting facts about credit cards.

1. Most Expensive Credit Card

Black Centurion Card offered by American Express is the most expensive credit card at the moment. It has an annual fee of $2,500 and requires the cardholder to spend at least $250,000 a year through credit card transactions. In some countries it also requires a
one-time joining fee.

2. How Visa Card Came Into Existence

In 1958 a credit card was issued by Bank of America. In 1970 the other American banks also joined and its control was handed over to a joint financial venture. In 1976 the name Visa was given to this operation.

3. Cash Back Bonus

Sears introduced its Discover Card in 1985. It was a big hit not only because it did not charge any annual fee, but it also actually offered an up to 5% Cash Back Bonus.

4. Is Low Minimum Payment Good For You?

The answer is a big NO, because that means more of the unpaid debt, which ultimately means more INTEREST.

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If you look at the stats of people who are unaware of the fact that they’re paying a penalty interest rate on their balance then you will find that the numbers are shocking. There are 50% of American card holders who are unaware of that fact.

They may know about the inflated rate, but they don’t understand why that rate has been applied to their balance.  Studies has shown that, when we talk about credit cards, then what you don’t know can create a problem for your finances.

Changes to Interest Rates

Most of the people criticize the way that credit card issuers handle interest rate change notifications. They don’t make sure that the customer knows how much interest they’re paying or why.

There could be an increase in interest as a result of a late or missed payment, or that could just because the company increased their interest rates in general.

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If you want to repair your credit score, the first and foremost thing that you need to do is to cut down on your monthly expenses. If you’re per month source of income is $1,000, then you should make sure that every month you save at least $300.

Pay Down Your Credit Cards

If you pay off your mortgage and student loans then this could play a prominent part in repairing your credit score. It is mostly preferred by the financial institutions that their should be a big gap between the credit amount that is used by you and the credit limits that are available for you.

If on each credit card you could have manage to keep your balances less than 30 % of the credit limit, then things will get better for you. While it is advised by majority of debt experts that you should pay off the highest-rate credit card first, it is suggested that you pay down the credit cards that are in line with the limits.

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