Are There No Annual Fee Bad Credit Credit Cards?

Credit cards for bad credit with no annual fee are not available. The annual fee serves to secure the credit card, and people are given the credit card to use because they are paying for the ability to use it. Securing the credit card is the method the banks use to test the waters with people who either have no credit, or bad credit.

Most of the time, credit cards with no annual fee require a good credit score because they are not secured. Unsecured credit cards carry more risk for the lenders and naturally require a good credit score. For those just starting out, a credit card with a small annual fee may be the best way to go. Keeping a good payment record will open the door to credit cards with no annual fee later.

When searching for bad credit- cards, it is important to consider there may be other fees in addition to annual fees, such as an account set up fee. Read the terms and conditions of the card very carefully before applying. Look closely for monthly servicing fees, program fees, and additional card fees. Some may find their entire credit limits overextended with the fees associated with getting the card, making the card more hassle than it's worth.