You’ll still have to make a minimum monthly repayment (usually around 3% of the balance), but you won’t be charged interest on any card purchases you haven’t paid off yet.

Advantages

0% purchase credit cards enable you to buy what you want today and pay everything back in a few months’ time without being charged interest, for a limited period.

They’re ideal for making more expensive purchases, such as home appliances or holidays, and because no interest will build up you can repay what you owe more quickly.

Disadvantages

You will still have to make your minimum payments, so if you’re looking to put off paying anything for a few months you’ll have to look at your other options.

You can still spend money up to your credit limit using 0% balance transfer credit cards, but they are generally better suited to people who want to pay off debts.

Advantages

0% balance transfer cards could save you money. By shifting debt from one or more other cards to your new card, you can repay what you’ve borrowed without paying any further interest.

The convenience of being able to consolidate several different debts onto one credit card is also a major advantage for many people.

Disadvantages

Although balance transfers are interest free, most card providers will still charge a balance transfer fee – usually around 3% of the balance.

The 0% interest period will be limited – usually for no longer than  15 months. After this time, you’ll start paying interest on any remaining balance unless you switch to another card offering the same type of deal.

Rewards on offer can include Airmiles, money off your shopping (particularly popular with supermarkets’ own credit cards), days out, vouchers and discounts on petrol.

Advantages

For each pound you spend using your card, you will earn reward points or cashback. The more you spend the more you’ll get back, so these cards are ideal for people who spend a lot of money on their credit card.

Disadvantages

Rewards and cashback credit cards are only worthwhile if you can repay your balance in full each month. If you don’t, the interest will generally cost more than the rewards you get back.

The level of rewards or cashback you’ll receive per pound spent can vary from card to card, so some cards are better than others. It’s worth looking carefully at what each card offers before you choose which one is best for you.

Using your new credit card properly will demonstrate to future lenders that you are a responsible borrower – so it could be a doorway to better credit card offers, or even something like a mortgage or a personal loan.

Compare the best credit cards for bad credit and other special offers with our simple credit card comparison table.

Adverse credit card deals

Many people struggle to find a good credit card deal because they have a poor credit rating. If you find yourself in this situation, you may need to find a deal aimed at borrowers with adverse credit.

There are plenty of credit cards available for people with adverse credit. These aren’t as hard to obtain as most other cards, but they often carry a much higher interest rate, and don’t tend to come with promotional offers (such as a 0% interest period).

However, if you repay your balance in full before the deadline each month, you’ll never pay any interest at all – so if you’re organised and disciplined, you’ll be able to use your card without paying a penny more than you’ve borrowed.

Credit builder cards

We all have to start somewhere. If you don’t have much experience with borrowing money, a ‘credit builder’ or ‘credit repair’ credit card deal could help you to build up your credit rating over time.

The more you use your credit card – and the more you repay your debts on time – the more you’ll be doing to prove yourself as a responsible borrower. This will be reflected in your credit history, meaning that you could find it easier to borrow money in the future.

This could be especially helpful if you’re thinking about taking out a bigger loan in the future – a mortgage, for example.

As well as helping people who have never borrowed money before and need to get some experience, they can also help people who have a poor credit history and want to build their credit rating back up again.

Advantages
‘Bad credit’ credit cards are easier for people with a poor credit rating to get hold of than other cards. If you’re worried about applying for a credit card because you’ve struggled in the past, you may have a better chance of being offered this type of card.

Using your card correctly will enable you to build your credit rating up, which could improve your chances of getting better deals in the future.

Disadvantages
The interest rate on credit cards for bad credit tends to be much higher than with other credit cards. This means if you don’t pay off your balance in full each month, you could end up paying a lot of interest.

An advantage of low-rate credit cards is that the low rate does not usually expire (unlike 0% interest deals). You’ll pay the same rate for as long as you keep the card. This means they can be suitable for longer-term borrowing, and could even provide a low-cost alternative to a personal loan.

Some low-rate credit cards don’t charge balance transfer fees, either. So although you’ll pay interest on balance transfers over time, you’ll avoid the expensive fee that comes with 0% balance transfer deals.

Advantages

A low-interest credit card could save you a lot of money compared with a card carrying a higher interest rate if you cannot repay the balance in full each month.

The low rate can make this type of credit card a good alternative to a personal loan – with some credit cards offering interest rates even lower than the most competitive loans. Plus it’s more flexible – you’ll only be required to make a minimum payment each month, usually around 3% of the balance, but you can pay more if you wish.

Finally, most low-rate cards don’t have an introductory period – your rate will stay the same for as long as you keep the card.

Disadvantages

Low-interest credit cards are usually only available to people with a very good credit rating. Most don’t offer any other benefits, either – the low interest rate is often the only real advantage.

Also remember that even though the interest rate is lower than most cards, interest could still add a lot to your total repayment if you don’t pay everything back in good time.

A new vehicle may lose 30% of its value in the first year of ownership. Many car manufacturers and dealerships place a high markup on new vehicles. As soon as a new car is driven off the dealership lot, it has dropped in value. In addition, new vehicles are often untested, with unknown reliability ratings. It’s possible for a new vehicle to be a lemon, or have other inherent problems.

When buying a cheap car on credit, it’s essential to look for a vehicle with as few miles as possible. It’s better to buy an older vehicle with fewer miles, rather than a new vehicle with 150,000 on the odometer. A vehicle’s expected lifetime is based on wear and tear. A new vehicle that has been heavily driven will break down before an older vehicle that has been kept in storage.

When looking for a cheap car on credit, look for brands that are extremely reliable. Brands such as Mazda and Toyota are known for long lasting quality. These vehicles can often be driven for 300,000 miles before any serious problems emerge.

It’s also important to check a vehicle’s history before any purchase decision. Some used vehicles may have been involved in theft, resulting in extensive damage. This damage may have been repaired, but the structural integrity of a vehicle has been reduced. In addition, a vehicle’s history can reveal any odometer fraud, flood damage, or other forms of hidden damage.

A sliver of silver lining from the Great Recession is the effect it has had on the consumer recruitment efforts undertaken by credit card companies. More specifically, the body blows the financial downturn administered to the portfolios of major credit card companies in the form of high delinquency and default rates emphasized the importance of garnering a financially stable customer base. So, like NCAA rule breakers, credit card companies are offering gifts to recruits with high credit scores in return for opening new cards. Given that these gifts typically come in the form of lucrative initial rewards bonuses and/or lengthy 0% introductory rates, they can be quite helpful during the busy holiday shopping season.

The best of the bunch are the following:

• Initial rewards bonus: The Chase Sapphire Preferred Credit Card offers 50,000 bonus points for spending $3,000 in the first three months after account opening, and does not charge an annual fee during the first year. The bonus points are worth either $625 in travel accommodations or $500 in the form of a check or statement credit.
• Zero percent on purchases: Roughly 29% of U.S. adults will need a few months to pay off holiday gift purchases this year, according to an American Express survey. A 0% credit card, like the Citi Dividend World MasterCard, would prove useful to members of this group, given its 15-month 0% purchase APR, $100 initial rewards bonus and 5% cash back on purchases made at numerous stores through the end of the year.
• Zero percent on transfers: Around 14 million U.S. consumers are still saddled with debt from the holidays last year, according to a Consumer Reports survey. Opening a 0% balance transfer credit card, like the Citi Platinum Select MasterCard, which does not charge interest on transferred debt for 21 months, could help you pay off debt faster and thereby make this year’s holiday season easier to handle, both financially and mentally.

Are These Cards Right for Everyone?
There are two types of people for whom the aforementioned cards are not a good fit. These cards are not a good fit for those with average or below-average credit, or those that will need the best possible credit score in the next six months because of an important loan application.The reasons for this are simple. You will not get approved for any of the cards mentioned above without excellent credit (typically a FICO score above 720) and your credit score may take a short-term hit when you open a new loan or line of credit.

For the latter reason, some consumers may be hesitant to open a new credit card just to save on holiday expenses, even if they don’t have any looming credit decisions. If you fit this description, you want a credit card that will prove financially helpful not only during the holiday season, but also throughout the rest of the year and beyond.

The Capital One Venture Card is the “most rewarding card if you crave free airline flights,” according to Money Magazine. It offers two miles for each dollar that you spend, which amounts to 2% cash back as long as you redeem miles for charges related to travel. It also provides a $100 initial rewards bonus for spending $1,000 in the first three months and, like all Capital One credit cards, does not assess foreign transaction fees, meaning it is a good tool for overseas travel

Just like a report card or a resume, a credit report is used to document your performance; in this case, your financial performance.

The report details how well you pay your bills, bank loans and credit card purchases. It also can indicate if you have abused financial tools such as checking accounts and debit cards. Even debts of small amounts, if not paid on time, can hurt your credit standing.

The three major credit agencies which monitor this activity are Equifax, Experian, and TransUnion. These agencies, also called “bureaus,” collect and report information about your financial habits and put the information into a credit report.

Below is a list of information that can appear on a credit report:

• Your name, Social Security number, birth date and current and previous addresses.

• Information about your employers, both current and previous.

• Your payment history with major credit cards, department store charge accounts and loan payments.

• Your payment history with utility and telephone services.

• A list of your accounts (if any) that have been referred to a collection agency.

• Inquiries made about your credit history that have been made over the past several years, and whether or not you were granted credit.

• Public record information: such as bankruptcies, foreclosures, and tax problems.

Information on a credit report can remain for many years. (This is often referred to as your “credit history.”) Since this report is used by others to make important decisions affecting you, it is important to review your credit report for accuracy once a year.