If you don’t have a high credit score which allows you to apply for credit cards, loans, or other special financing terms, this can greatly hinder your ability to shop online. With bad credit catalogues, not only does this afford you the opportunity to buy online, and afford items you otherwise couldn’t, it provides you with an alternative to traditional shopping in stores, for higher prices. Before you apply for bad credit catalogue financing, there are some things you should be aware of.
The simple fact that you have a low credit score will already increase the interest rates you are going to pay when financing the purchase of items with a credit card or catalogue account. So, be prepared to incur higher credit interest amounts, and stricter repayment terms on your account as well.
Another restriction on bad credit catalogue accounts is short repayment periods. A traditional catalogue account might offer up to 60-months to repay. Those who have bad credit, will typically find their repayment window to be structured around a 3 or 6-month window. Over time, and as you build up your credit, this might change. However, early on, and until you can prove you are trustworthy and are going to make your payments on time, catalogue sites are going to limit your spending limits.
This is going to be the case with any line of credit, including secured credit cards, you apply for, as a bad credit borrower. Because of your previous issues with late payments, missed payments, and a low credit score, you aren’t viewed as a reliable customer. You have to build yourself up and your reputation up. Over time, many catalogues and creditors may eventually increase your limits, however, early on, you are going to find this isn’t the case.
You might have limits on your account. For example, there may be items you won’t qualify for on credit, or repayment terms might be stricter than for other customers. Make sure you understand the limits, the structure of your account, and what you can/can’t buy, when you are applying for and are approved as a bad credit borrower with catalogue sites.
You’ll likely incur higher penalties if you are late or miss a payment. And, you might automatically lose your account, or have it closed, if you are late after a certain grace period. The fact that you already have a faulty past as a borrower, limits your ability to get approval on accounts. So, when a catalogue affords you an opportunity, you have to make sure you pay on time, pay above the minimum, and work your way up to higher limits over time.
Depending on the catalogue you apply for credit with, there are restrictions on bad credit financing. For some catalogues, it might simply be if your score is below a certain number, they will automatically decline you for an account. With others, there are severe restrictions on account use and credit limits. And, with some catalogues, they won’t afford you financing at all, if you have a faulty credit past. It is up to you to compare a few catalogues, understand their terms and restrictions, and find out what you will or won’t qualify for, based upon their terms, limits and restrictions, and the types of accounts which they do have available, for the borrowers who do not have the best credit score around.
There are benefits and drawbacks of bad credit catalogue shopping. Some of the benefits include the fact that you will be approved for financing. Even if you don’t have a stellar credit score, some catalogues are willing to extend you a loan/limit. You can also rebuild your credit over time. By paying early and higher than the minimum due each month, you’ll find that your score is slowly going to build itself up, and you will be approved for different cards and options, when it comes to financing through different online catalogues that you want to shop with as well.
There are also some drawbacks to financing with bad credit catalogues including:
You have to understand that your checkered past, and poor credit history, make you a hindrance on credit card companies. So, when you do apply for financing with bad credit catalogues, if they do afford you a line of credit, and are willing to work with you as a customer, they are going to restrict what you can buy, how much you can spend, and other terms on the account which they choose to approve you for as a bad credit borrower.
Shop around. If you have low credit scores, if you have missed payments or are delinquent on accounts, there are some ways you can go about rebuilding your credit over time. And, with bad credit catalogue shopping, you have a viable solution for ways in which you can buy more, afford more, and build your credit score up over time as well.
You must do your research, understand limits, restrictions, and know what the drawbacks are before you apply for an account with a bad credit catalogue. Although there are a few drawbacks, there are also benefits to helping you rebuild your credit worthiness and rebuild your score as time progress as a bad credit catalogue customer. When the time comes for you to decide which catalogue to apply with, consider these factors, shop, compare rates, compare the limits they will offer to you, and understand your rights, to ensure you receive the fairest and best terms on the account you open, with any of the many bad credit catalogues you choose to apply with.