A Quick Look at Your Credit Score


There are different ways and formulas to calculate your credit score. But in general, there are 5 factors that affect your score. If you have bad credit and you want to boost your score, below are some things you need to understand first

Your credit score is represented by a 3-digit number, which is then assigned a standing from very poor to poor, fair, good and excellent. When calculating your credit score, agencies tap on your credit report. If you have a history of late or missed payments, ccjs or defaults, you’re in for a struggle especially if you’re hopping to apply for a new credit card, a loan or a mortgage.

If you’re currently stuck with a bad credit score, there’s really just one best solution. Find out the best ways to improve your credit score as quickly as possible. To do that, start by understanding how your score is broken down.

As mentioned, there are five factors that affect how your credit score is calculated and they include the following:

Payment History

Payment history constitutes 35% of your score. This is also what most lenders want to know first thing when dealing with consumers. Included in here are your delinquencies and defaults if there are any.

Amounts Owed

The amount you owe on your accounts is 30% of your credit score. This includes credit card balances and other loan balances you currently owe on all your revolving accounts. If you want to improve your score, you can do it by trying to lower the amount you owe.

Length of Credit History

The length of your credit history is 15% of your credit score. In general, the longer your history is, the higher your score will be. To determine your credit history, agencies look at how long your credit accounts have been established and how long it has been you’ve been using said accounts.

Types of Credit in Use

The types of accounts or credits you use also matter when calculating your credit score. It includes all your revolving and installment accounts such as credit cards, retail accounts, installment loans and more.

New Credit

Finally, your new credit accounts constitute 10% of your score. This refers to the number of credit accounts you’ve recently applied for or opened. If you have bad credit, you may opt for a bad credit credit card as a way to build your score. Just remember to keep the number of new credit accounts minimal.

Six Credit Card Disastrous Mistakes to Avoid


Regardless if you have a regular credit card or a bad credit credit card, there are common mistakes you should avoid by all means. Otherwise, you may end up paying heftier fees than normal. And worse, your credit rating can go from fair to poor and really bad. If you don’t want that to happen, here are some common mistakes to steer clear from:

Paying only the minimum payment

One of the most common and unfortunately detrimental mistakes many consumers continue to commit is paying only the suggested minimum payment. The problem with this practice is not just about lengthening the amount of time you pay for the balance but you are actually increasing the amount of interest you incur over time. Rather than pay the minimum, you’ll always be better off increasing your monthly credit card payments.

Paying beyond your due date

Late payments are another habit you should avoid by all means. Just like minimum payments, this practice can lead to major financial consequences. One of which is the infamous increasing interest rates and hidden fees associated with late payments. Remember that even a day or two of being late on your payments is considered as a 30-day late payment by most banks. Avoid this disastrous mistake by scheduling your payments a few days before your due date.

Using card as substitute for cash

Considering the convenience your card offers, it’s very tempting to just keep swiping as if it’s cash you have. Well, that’s one mistake you’re going to pay a lot for in the end. When you substitute your card for cash and use it for purchases like gas, food and other essentials, you are putting yourself in a very difficult financial spot. Most often than not, you will find yourself paying for the bills long after you’ve consumed the goods. The solution, stick with cash when it comes to your essential purchases.

Taking a cash advance

Your still a few days from receiving your paycheck and you don’t have any cash available anymore. Since the credit card is handy, you’ve decided to take a cash advance and that’s another major credit card blunder you just committed. And it will cost you dearly too. In most cases, you’ll probably end up paying more in interest than your normal credit card charges. Plus there’s also the transaction fee on top of the interest rate. Read the fine print so you know the terms with regards to cash advance, interest rates, hidden fees and more.

Maxing out your credit card

Your bank has increased your credit limit but that doesn’t mean you should use them all up. It’s tempting to do so, yes, but like other credit card blunders, this habit can cost you dearly. In fact, charging your card beyond the recommended 30% of your credit limit can hurt your credit score. A maxed out credit card also means it will be harder for you to pay the balance in full each month. And when you carry a high credit card balance, it usually means higher incurred interest.

Closing your credit card account

You’ve paid your card in full and now you want to close the account. Don’t do that just yet especially if you have bad credit. When you close your credit card account, you are essentially reducing your available credit line and that may have a huge impact on your credit score. Keep it open and use it regularly but this time, stay within the 30% credit limit suggestion and pay all your bills on time.

Secured Credit Cards vs. Unsecured Credit Cards


If you have bad credit because of poor credit decisions, you probably already know by now that there are major financial consequences. You can’t get a loan that quick or get approved for a mobile phone contract because of your less than stellar credit history. Whichever way you look at it, bad credit is exactly what the phrase suggests. It’s bad.

So what should you do if you have bad credit and you want to apply for new credit? There are two options available. Either you pay a company to do the credit score repair or opt for a bad credit credit card you can use to rebuild your credit rating. Obviously, the latter will take longer but it’s one many experts recommend. If you’re committed enough, using credit cards to repair your credit score really work in the end.

When it comes to credit cards for people with bad credit, there are two types you can choose from. They are secured cards and unsecured cards. The next question is, which one is better for you? To answer this predicament, let’s take a closer look at each type.

What are secured credit cards?

Secured cards are cards that require you to provide a deposit that is equivalent to your card’s credit limit. For instance, if your limit is £300 then you must provide £300 in deposit to the bank before issued the card. But don’t worry you will get the money back once you close the account and provided that you’ve demonstrated good consumer behavior.

Once approved for a secured card, you can use it like you would an unsecured card or any credit card for that matter. It is offered by majority of banks in the UK for people with bad credit and no credit history yet.

What are unsecured credit cards?

Unsecured credit cards, on one hand, are options that are mostly offered for people with a good credit standing. As the name suggests, the card type does not require any deposits making it more financially convenient for consumers. Most cards offered my banks are actually unsecured and they also offer added perks like rewards, cash back, discounts and more.

Since the card is not secured on any deposit or collateral, it is much harder to get approved for especially if you have bad credit. There are still some unsecured options available and easier to quality for but they usually come with hefty annual fees and steep charges.

Which is best for you?

As you have seen above, there are pros and cons for each type of credit card. With secured cards, you’ll have a hard time if you don’t have sufficient cash to pay for the deposit. With unsecured loans, you’ll also have a hard time securing a card if you have poor credit history. In the end, it boils down to which type is perfectly suited for your financial circumstances.

But if you do have enough cash and you have bad credit history, opting for a secured credit card is a safe bet. All you need to do is provide the money for the deposit and your application is often good as approved. While the interest rates are not exactly something to be completely happy about, it is relatively lower than what unsecured credit cards for people with bad credit charge.

In any case, the trick is to stay within your credit limit and pay your bills on or before your due date to maintain good standing and improve your credit rating over time.

6 Credit Card Options for People with Bad Credit


When you have a less than stellar credit rating, chances are high that you will have a hard time applying for new credit. In fact, you may get rejected a number of times because with bad credit under your belt, you are now tagged a high risk borrower. Because of these struggles, most people just stop trying. You might get tempted to do the same but don’t. It will be harder to improve your currently dire credit rating situation without a new credit to give you a chance to improve.

Rather than lose sleep and time actively trying to apply for standard and traditional credits, there’s a much easier way to get approved for a credit card even with bad credit. Apply for bad credit cards. There are made especially for people with bad credit hence easy to avail. But there’s just one hitch. Bad credit credit cards come with heftier interest rates and charges. If you’re going this route, remember to use it with care and with the main goal of improving your credit rating.

Below are some of the most competitive bad credit credit cards available for UK consumers:

Aqua Classic 29

This option offers a credit limit between £250 and £1,200 and may increase after four months if you’re a good payer. This is a great option if you want to rebuild your credit rating. You also get a free access to your credit report. Just remember that the APR will largely depend on your financial circumstances.

Marbles Classic 29.7

Marbles Classic 29.7 offers a similar credit limit as Aqua Classic 29, which is between £250 and £1,200 for a start. It includes perks such as tracking online transactions and receiving text alerts once you’re close to your credit limit. Unfortunately, it’s not for people with a history of CCJs in the last 12 months. APR is also dependent on your financial circumstances.

Capital One Classic Platinum

This is another bad credit credit card you can use to improve your current rating. It doesn’t matter if you’ve had credit problems in the past. You can avail of the card’s offered credit limit starting from £200 up to £1,500. To be eligible for the card, you must have no declared bankruptcy record in the past 12 months and you should have

Aquis Visa Card

If you want a larger credit limit, Aquis Visa Card is a good option to look into. The card offers up to £3,500 credit limit but subject to approval. Once approved for the card, you can start rebuilding your credit rating by staying below the limit and paying your dues on time. You get free SMS and online account management as part of the card’s features. Just like the other cards, APR is largely depending on your personal circumstances.


With Barclaycard’s credit card offer, you get to earn a £40 cashback paid in £10 per three months if you maintain good consumer behaviour. Another perk you get to avail is the reducing interest rate over the months provided that you always pay your dues on or before time. You’ll also need to stay within or preferably below your credit limit. The card is suited With Barclaycard’s credit card offer, you get to earn a £40 cashback paid in £10 per three months if you maintain good consumer behaviour. Another perk you get to avail is the reducing interest rate over the months provided that you always pay your dues on or before time. You’ll also need to stay within or preferably below your credit limit. The card is suited

Aqua Reward

Aqua Reward is another great option if you want to earn cash back. The card offers 0.5% cash back on all purchases and a credit limit of up to £1,200. To be eligible for the card, you must not have a CCJ on record in the last 12 months.