Can I get a credit card with a bad credit history?

Can I get a credit card with a bad credit history?

author: Dan Griffiths

By Dan Griffiths

Put simply, having a bad credit history doesn’t necessarily mean the doors to borrowing will all be closed.

There are some lenders, including Ocean, who will accept people who have struggled with credit in the past.

If you’re considering whether to take out a new credit card, you need to be confident that you’ll be able to make at least your monthly minimum payments without fail, as you could risk damaging your credit history further - and incurring extra charges - if you don’t. Ideally you want to be paying off the full balance or as close to it as you can, otherwise it could take you many months, and in some cases years, to pay back what you owe.

Think about your situation

Whether you should take out a credit card if you’ve struggled with credit in the past really depends on your individual circumstances. For example, if you’re now in a stable job with low levels of debt, a credit card might actually be a sensible move to help you repair your damaged credit history.

If you’ve already got a wallet full of credit cards that all have balances at or near their credit limits, on the other hand, taking out another one really isn’t a good idea. That’s why, before we discuss the options that might be available to you, we’ll explore the reasons behind your bad credit history.

What’s the reason for your bad credit history?

Before even considering taking out a credit card, it makes sense to take a look at your credit history and identify where you went wrong.

If you haven’t checked your credit history before, or if you haven’t checked it in a while, now is the perfect time to do so. You can use one of the three credit reference agencies (Experian, Equifax or Callcredit) to keep on top of things so you always know if there are any changes to your credit history.  All of them will give you access to your “statutory credit history” for £2.

Once you’ve got hold of your credit history, you should be able to see where things might have gone wrong – if you didn’t know beforehand. It could be as simple as the odd late payment on your mobile phone bill.  Or you could have had more serious problems: for example, if you’ve had any CCJs, or if you’ve fallen behind or defaulted on any credit card, loan or mortgage repayments in the past six years you should be able to see these on your credit file. These will all affect your credit score negatively, but that’s not to say you can’t do something about it. It is often possible to turn your situation around, and a credit card may be able to help you do just that. 

If you’ve got a number of credit cards already, or you’ve got a high level of debt elsewhere, you probably shouldn’t applying for another credit card. You should focus on paying off your existing debts first. The Money Advice Service offers free advice on what to do if you’re struggling with debt.

It’s not all doom and gloom

If you’re in a comfortable financial situation but you’re looking to repair a damaged credit history, taking out a credit card might actually help you to get back on track.

Providing you make at least the minimum repayment each month – although it’s wise to pay off as much as you can – your credit rating will improve gradually.

The Ocean credit card (representative APR 39.9%) is suited for people with patchy credit histories. So long as you are on the electoral roll, are over 18 and can demonstrate some history of managing credit in the past, you could be accepted and start to rebuild your credit history. You can find out more about our credit card for bad credit here>

Disclaimer: All information and links are correct at the time of publishing.

author: Dan Griffiths

By Dan Griffiths