March 17, 2023
*Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.
This article was last updated March 17, 2023 . Terms and conditions may have changed. For the most accurate information, please consult the issuer website.
The Discover it® Secured Credit Card is our top pick: It reports your payment activity to the three major credit bureaus (Equifax, Experian and TransUnion), provides the opportunity to get your security deposit back after demonstrating responsible card usage, charges a $0 annual fee and earns cash back rewards.
If you have bad credit (usually a credit score less than 580), you’ve likely experienced embarrassing rejections and high-interest offers when applying for a new loan or credit card. The good news is — the right credit card can actually help you establish or rebuild your credit score, so you can eventually qualify for cards with higher rewards rates, better benefits and lower APRs.
We compiled a list of the best credit cards for people with bad credit, including secured and unsecured options that report to the three major credit bureaus (Experian, Equifax and TransUnion), charge limited fees, offer reasonable APRs and provide the opportunity to boost your credit profile.
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: The Discover it® Secured Credit Card hits everything you’d want in a card for poor/limited credit: a $0 annual fee, credit bureau reporting and cash back on every purchase. Plus, after seven months, Discover will begin monthly reviews of your account to see if you qualify to get your deposit back and graduate to an unsecured card.
Pros and cons:
The Discover it® Secured Credit Card is one of the top cards around if you need to rebuild your credit. It’s accessible with a $200 minimum deposit, and Discover is clear on when your account will be reviewed for the chance to upgrade to an unsecured card. Plus, it earns 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically. And Discover will match all the cash back you’ve earned at the end of your first year.
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: The Discover it® Secured Credit Card hits everything you’d want in a card for poor/limited credit: a $0 annual fee, credit bureau reporting and cash back on every purchase. Plus, after seven months, Discover will begin monthly reviews of your account to see if you qualify to get your deposit back and graduate to an unsecured card.
Pros and cons:
The Discover it® Secured Credit Card is one of the top cards around if you need to rebuild your credit. It’s accessible with a $200 minimum deposit, and Discover is clear on when your account will be reviewed for the chance to upgrade to an unsecured card. Plus, it earns 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically. And Discover will match all the cash back you’ve earned at the end of your first year.
Minimum deposit: No deposit
Credit limit: $300 to $2,000
Why we picked this card: The AvantCard Credit Card is a solid option if you want to improve your Fair/Poor/Limited credit with the help of a card that doesn’t require a security deposit.
Pros and cons:
If you don’t want to tie up money in a security deposit, and you’re willing to pay a $59 annual fee, the AvantCard Credit Card is an unsecured card worth considering. However, the card does come with a high APR of 29.49%. Additionally, the card is not available to residents of Colorado, Iowa, Vermont, West Virginia or Wisconsin.
Minimum deposit: No deposit
Credit limit: $300 to $2,000
Why we picked this card: The AvantCard Credit Card is a solid option if you want to improve your Fair/Poor/Limited credit with the help of a card that doesn’t require a security deposit.
Pros and cons:
If you don’t want to tie up money in a security deposit, and you’re willing to pay a $59 annual fee, the AvantCard Credit Card is an unsecured card worth considering. However, the card does come with a high APR of 29.49%. Additionally, the card is not available to residents of Colorado, Iowa, Vermont, West Virginia or Wisconsin.
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The OpenSky® Secured Visa® Credit Card may be your best option if you’re worried that your credit is too bad to get approved even for a secured card — it doesn’t require a credit check when you apply.
Pros and cons:
Since the OpenSky® Secured Visa® Credit Card doesn’t require a credit check when you apply, it’s a solid option for those whose credit is too bad to get approved for a traditional card or even a secured card.
Additionally, the card does not require a bank account for approval. You will, however, have to provide some personal financial information, such as your annual income, monthly housing payment and housing payment type.
The OpenSky® Secured Visa® Credit Card charges a $35 annual fee and has a regular APR of 21.89% (variable). The card also requires a refundable security deposit ranging from $200 to $3,000.
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The OpenSky® Secured Visa® Credit Card may be your best option if you’re worried that your credit is too bad to get approved even for a secured card — it doesn’t require a credit check when you apply.
Pros and cons:
Since the OpenSky® Secured Visa® Credit Card doesn’t require a credit check when you apply, it’s a solid option for those whose credit is too bad to get approved for a traditional card or even a secured card.
Additionally, the card does not require a bank account for approval. You will, however, have to provide some personal financial information, such as your annual income, monthly housing payment and housing payment type.
The OpenSky® Secured Visa® Credit Card charges a $35 annual fee and has a regular APR of 21.89% (variable). The card also requires a refundable security deposit ranging from $200 to $3,000.
Minimum deposit: $100
Credit limit: $100 to $1,000
Why we picked this card: The Amazon Secured Card has a lower minimum deposit than many secured cards, which can be helpful if you’re struggling to put together a $200 or $300 deposit. Plus, you may be able to graduate to an unsecured card after using this card responsibly for 12 months.
Pros and cons:
If you shop frequently at Amazon.com and want to build credit, the Amazon Secured Card might be what you’re looking for. Plus, for consumers who want to avoid the $200 minimum deposit many secured cards require, the Amazon Secured Card is accessible with a deposit as low as $100. Lastly, the card also offers an opportunity to earn 2% back at Amazon.com, Amazon Fresh and more, with an eligible Prime membership.
Minimum deposit: $100
Credit limit: $100 to $1,000
Why we picked this card: The Amazon Secured Card has a lower minimum deposit than many secured cards, which can be helpful if you’re struggling to put together a $200 or $300 deposit. Plus, you may be able to graduate to an unsecured card after using this card responsibly for 12 months.
Pros and cons:
If you shop frequently at Amazon.com and want to build credit, the Amazon Secured Card might be what you’re looking for. Plus, for consumers who want to avoid the $200 minimum deposit many secured cards require, the Amazon Secured Card is accessible with a deposit as low as $100. Lastly, the card also offers an opportunity to earn 2% back at Amazon.com, Amazon Fresh and more, with an eligible Prime membership.
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: It’s rare to find a card intended for those with Poor/Limited credit that offers an intro APR on balance transfers — but the Discover it® Secured Credit Card does just that.
Pros and cons:
If you have a large amount of high-interest credit card debt that you want to transfer, the Discover it® Secured Credit Card may be the way to go. This card offers a 10.99% Intro APR for 6 months on balance transfers (then a 27.49% Variable APR applies) and charges a 3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)*.
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: It’s rare to find a card intended for those with Poor/Limited credit that offers an intro APR on balance transfers — but the Discover it® Secured Credit Card does just that.
Pros and cons:
If you have a large amount of high-interest credit card debt that you want to transfer, the Discover it® Secured Credit Card may be the way to go. This card offers a 10.99% Intro APR for 6 months on balance transfers (then a 27.49% Variable APR applies) and charges a 3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)*.
Minimum deposit: $500
Credit limit: $500 minimum, no set maximum
Why we picked this card: The DCU Visa® Platinum Secured Credit Card charges a $0 annual fee and offers a low APR of 15.75% Variable.
Pros and cons:
If you are searching for a credit card with a low interest rate and a $0 annual fee, the DCU Visa® Platinum Secured Credit Card may be worth looking into. The card also comes with a $0 foreign transaction fee and no cash advance fee. As for balance transfer fees — there are none. The card’s low APR is helpful if you plan to carry a balance on your card from month to month.
Note, you do have to be a member of Digital Federal Credit Union (DCU) to be approved for this card, but there are plenty of options for eligibility.
Minimum deposit: $500
Credit limit: $500 minimum, no set maximum
Why we picked this card: The DCU Visa® Platinum Secured Credit Card charges a $0 annual fee and offers a low APR of 15.75% Variable.
Pros and cons:
If you are searching for a credit card with a low interest rate and a $0 annual fee, the DCU Visa® Platinum Secured Credit Card may be worth looking into. The card also comes with a $0 foreign transaction fee and no cash advance fee. As for balance transfer fees — there are none. The card’s low APR is helpful if you plan to carry a balance on your card from month to month.
Note, you do have to be a member of Digital Federal Credit Union (DCU) to be approved for this card, but there are plenty of options for eligibility.
Minimum deposit: $49, $99 or $200
Credit limit: $200 to $1,000
Why we picked this card: Typically, when you get a secured credit card, you must submit a deposit in the amount of your desired credit limit. But the Capital One Platinum Secured Credit Card offers the chance to get a $200 starting credit limit with a $49, $99 or $200 deposit. Just know, you aren’t guaranteed to get the lower deposit amounts.
Pros and cons:
If you want to use a secured card to help build your credit without submitting a large deposit upfront, the $0-annual-fee Capital One Platinum Secured Credit Card could be a good fit — as long as you qualify for the lower deposit amount.
Additionally, after six months of demonstrating responsible card usage, Capital One will review your eligibility for an increased credit limit.
The card does, however, come with a relatively high purchase APR of 29.74% (Variable), and there is no rewards program.
Minimum deposit: $49, $99 or $200
Credit limit: $200 to $1,000
Why we picked this card: Typically, when you get a secured credit card, you must submit a deposit in the amount of your desired credit limit. But the Capital One Platinum Secured Credit Card offers the chance to get a $200 starting credit limit with a $49, $99 or $200 deposit. Just know, you aren’t guaranteed to get the lower deposit amounts.
Pros and cons:
If you want to use a secured card to help build your credit without submitting a large deposit upfront, the $0-annual-fee Capital One Platinum Secured Credit Card could be a good fit — as long as you qualify for the lower deposit amount.
Additionally, after six months of demonstrating responsible card usage, Capital One will review your eligibility for an increased credit limit.
The card does, however, come with a relatively high purchase APR of 29.74% (Variable), and there is no rewards program.
Minimum deposit: No deposit
Credit limit: $300 – $5,000 credit limits
Why we picked this card: If you’d rather use your “Cash Score” to determine your eligibility instead of your credit score, the Petal® 1 No Annual Fee Visa® Credit Card could be a good fit.
Pros and cons:
If you have bad credit, it can be difficult to get approved for an unsecured card. The Petal® 1 No Annual Fee Visa® Credit Card uses Cash Score technology derived through analysis of banking and bill payment patterns, rather than relying on traditional credit scores to determine creditworthiness. This card also reports to the three major credit bureaus, comes with no annual fee and offers rewards on some purchases.
Minimum deposit: No deposit
Credit limit: $300 – $5,000 credit limits
Why we picked this card: If you’d rather use your “Cash Score” to determine your eligibility instead of your credit score, the Petal® 1 No Annual Fee Visa® Credit Card could be a good fit.
Pros and cons:
If you have bad credit, it can be difficult to get approved for an unsecured card. The Petal® 1 No Annual Fee Visa® Credit Card uses Cash Score technology derived through analysis of banking and bill payment patterns, rather than relying on traditional credit scores to determine creditworthiness. This card also reports to the three major credit bureaus, comes with no annual fee and offers rewards on some purchases.
Minimum deposit: $300
Credit limit: $300 to $5,000
Why we picked this card: The U.S. Bank Altitude Go Visa Secured Card offers a generous rewards program: 4X points on dining and takeout, 2X at grocery stores, gas stations and on streaming services, 1X on all other purchases. Plus, get a $15 annual streaming credit after you’ve made 11 consecutive months of eligible streaming purchases.
Pros and cons:
If you’re looking to build credit and you spend a lot on dining, takeout and delivery, on streaming services or at gas stations and EV charging stations, the U.S. Bank Altitude Go Visa Secured Card is a good card to consider. Rewards can be redeemed for travel, merchandise, cash back or gift cards. You can also redeem points instantly for nearly any purchase with Real-Time Rewards.
Minimum deposit: $300
Credit limit: $300 to $5,000
Why we picked this card: The U.S. Bank Altitude Go Visa Secured Card offers a generous rewards program: 4X points on dining and takeout, 2X at grocery stores, gas stations and on streaming services, 1X on all other purchases. Plus, get a $15 annual streaming credit after you’ve made 11 consecutive months of eligible streaming purchases.
Pros and cons:
If you’re looking to build credit and you spend a lot on dining, takeout and delivery, on streaming services or at gas stations and EV charging stations, the U.S. Bank Altitude Go Visa Secured Card is a good card to consider. Rewards can be redeemed for travel, merchandise, cash back or gift cards. You can also redeem points instantly for nearly any purchase with Real-Time Rewards.
Minimum deposit: $200
Credit limit: $200 to $5,000
Why we picked this card: If you want to have some say so as to which of your purchases earn rewards, the Bank of America® Customized Cash Rewards Secured Credit Card lets you choose from six different categories to earn the highest cash back rate.
Pros and cons:
The Bank of America® Customized Cash Rewards Secured Credit Card is best if you want a secured card that can also earn rewards. This $0-annual-fee card lets you earn 3% cash back in a category of your choice each month.
The choice categories include:
Minimum deposit: $200
Credit limit: $200 to $5,000
Why we picked this card: If you want to have some say so as to which of your purchases earn rewards, the Bank of America® Customized Cash Rewards Secured Credit Card lets you choose from six different categories to earn the highest cash back rate.
Pros and cons:
The Bank of America® Customized Cash Rewards Secured Credit Card is best if you want a secured card that can also earn rewards. This $0-annual-fee card lets you earn 3% cash back in a category of your choice each month.
The choice categories include:
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The Capital One Quicksilver Secured Cash Rewards Credit Card offers a simple cash back rate on everyday purchases. Cardholders earn 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply).
Pros and cons:
If you want to build credit while earning cash back at a competitive rate on every purchase, you may like the Capital One Quicksilver Secured Cash Rewards Credit Card. Cardholders earn 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply). Additionally, the $0 annual fee card offers automatic credit line reviews starting at six months to determine if you qualify for a higher credit line.
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The Capital One Quicksilver Secured Cash Rewards Credit Card offers a simple cash back rate on everyday purchases. Cardholders earn 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply).
Pros and cons:
If you want to build credit while earning cash back at a competitive rate on every purchase, you may like the Capital One Quicksilver Secured Cash Rewards Credit Card. Cardholders earn 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply). Additionally, the $0 annual fee card offers automatic credit line reviews starting at six months to determine if you qualify for a higher credit line.
Minimum deposit: $200
Credit limit: $200 to $2,000
Why we picked this card: While cards for those with bad credit often have very high APRs — sometimes upwards of 30% (variable) — the First Progress Platinum Prestige Mastercard® Secured Credit Card has a low ongoing APR of 14.49% (V) on purchases. Plus, the card doesn’t require a minimum credit score or credit history for approval.
Pros and cons:
We recommend paying your balance in full each month — but we also know that may not always be possible. So if you find yourself needing to carry a balance on your card month over month, a card with a low APR, like the First Progress Platinum Prestige Mastercard® Secured Credit Card could be ideal.
The card requires a refundable security deposit of $200 to $2,000 and charges a $49 annual fee.
Minimum deposit: $200
Credit limit: $200 to $2,000
Why we picked this card: While cards for those with bad credit often have very high APRs — sometimes upwards of 30% (variable) — the First Progress Platinum Prestige Mastercard® Secured Credit Card has a low ongoing APR of 14.49% (V) on purchases. Plus, the card doesn’t require a minimum credit score or credit history for approval.
Pros and cons:
We recommend paying your balance in full each month — but we also know that may not always be possible. So if you find yourself needing to carry a balance on your card month over month, a card with a low APR, like the First Progress Platinum Prestige Mastercard® Secured Credit Card could be ideal.
The card requires a refundable security deposit of $200 to $2,000 and charges a $49 annual fee.
Most credit cards designed for those with bad credit come with high APRs and/or annual fees. This can make paying off your balance difficult, since so much of your monthly payment ends up going to interest or fees. That is one reason why it’s important to look for a credit card with a low interest rate and/or no annual fee. You should also take a look at the recommended credit of the card before you apply to to help ensure you’ll qualify. A card offering a rewards program or welcome offer is a plus too.
| Credit Card | Welcome Offer | Rewards Rate | Annual Fee | Regular APR | Intro Balance Transfer Rate | Regular Balance Transfer Rate | Balance Transfer Fee | Card Review |
|---|---|---|---|---|---|---|---|---|
|
Discover it® Secured Credit Card
|
Discover will match all the cash back you’ve earned at the end of your first year. | 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically | $0 | 27.49% Variable APR | 10.99% Intro APR for 6 months | 27.49% Variable APR | 3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)* | Discover it® Secured Credit Card Review |
|
AvantCard Credit Card
|
None | Non-rewards card | $59 | 29.49% | N/A | N/A | N/A | AvantCard Credit Card Review |
|
OpenSky® Secured Visa® Credit Card
|
N/A | None | $35 | 21.89% (variable) | N/A | N/A | N/A | OpenSky® Secured Visa® Credit Card Review |
|
Amazon Secured Card
|
N/A | 2% back at Amazon.com, Amazon Fresh and more, with an eligible Prime membership | $0 | 10.00% non-variable | N/A | N/A | N/A | Review Coming Soon |
|
DCU Visa® Platinum Secured Credit Card
|
N/A | N/A | $0 | 15.75% Variable | N/A | 15.75% Variable | None | DCU Visa® Platinum Secured Credit Card Review |
|
Capital One Platinum Secured Credit Card
|
No bonus | Non-rewards Card | $0 | 29.74% (Variable) | N/A | 29.74% (Variable) | $0 at this Transfer APR | Capital One Platinum Secured Credit Card Review |
|
Petal® 1 No Annual Fee Visa® Credit Card
|
N/A | Earn 2% to 10% cash back at select merchants | $0 | Variable APR between 24.49% - 33.99% | N/A | N/A | N/A | Petal® 1 No Annual Fee Visa® Credit Card Review |
|
U.S. Bank Altitude Go Visa Secured Card
|
No bonus | 4X points on dining and takeout, 2X at grocery stores, gas stations and on streaming services, 1X on all other purchases | $0 | 29.49% | N/A | 29.49% | 3% of the amount of each transfer or $5 minimum, whichever is greater | Review Coming Soon |
|
Bank of America® Customized Cash Rewards Secured Credit Card
|
N/A | Earn 3% cash back in a category of your choice each month | $0 | 24.24% variable | N/A | 24.24% variable | 3% of each transaction (minimum $10) | Review Coming Soon |
|
Capital One Quicksilver Secured Cash Rewards Credit Card
|
N/A | 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply) | $0 | 29.74% (Variable) | N/A | 29.74% (Variable) | $0 at this Transfer APR | Capital One Quicksilver Secured Cash Rewards Credit Card Review |
|
First Progress Platinum Prestige Mastercard® Secured Credit Card
|
No bonus | 1% Cash Back | $49 | 14.49% (V) | N/A | N/A | N/A | First Progress Platinum Prestige Mastercard® Secured Credit Card Review |
The credit scoring method most lenders use to determine your credit rating is the FICO Score, which can range from 300 to 850. Any FICO Score lower than 580 is considered a bad credit score. Another credit scoring model you may encounter is the VantageScore, which also ranges from 300 to 850. Any number below 600 on the VantageScore scale is considered poor.
FICO Score
| Credit rating | Credit score |
|---|---|
| Poor credit | 300 to 579 |
| Fair credit | 580 to 669 |
| Good credit | 670 to 739 |
| Very good credit | 740 to 799 |
| Exceptional credit | 800 to 850 |
VantageScore
| Credit rating | Credit score |
|---|---|
| Very poor credit | 300 to 499 |
| Poor credit | 500 to 600 |
| Fair credit | 601 to 660 |
| Good credit | 661 to 780 |
| Excellent credit | 781 to 850 |
Check your credit score and credit reports
There are several ways you can check your credit score for free without hurting it, including signing up for a free LendingTree account or creating an account directly with the credit bureau Experian.
We should note that Experian also offers Experian Boost, which allows payments that wouldn’t normally affect your credit score — such as utilities, eligible streaming services and your phone bill — to build positive credit history on your Experian report.
You’re also entitled to a free credit report every year from each of the three bureaus via annualcreditreport.com — and since the coronavirus pandemic, the bureaus have been offering free weekly reports (available until Dec. 31, 2023).
If you spot something inaccurate on your credit report, you can file a dispute to get it removed.Get a credit card and use it responsibly
Used poorly, a credit card can bury you in debt and drain your bank account due to interest charges. But used responsibly, it can be a powerful tool for showing lenders you’re trustworthy. Here’s how to do it right:
Avoid applying for too much credit
Getting a credit card that reports to the bureaus can help improve your credit score. But once you’ve obtained it, you should avoid applying for new credit too often, because doing so hurts your score the following ways:
No. Although some cards claim to offer “guaranteed approval,” there’s no such thing as a 100% guarantee. If you have bad credit, your best chance at approval is with a secured credit card.
However, you could still be denied a secured credit card for a variety of reasons — your credit score might not reach an issuer’s minimum requirements, or you may not have a long enough credit history or meet an income requirement.
If you’re unable to qualify for a typical secured credit card, there are still ways you can build credit without a credit card, like becoming an authorized user on someone else’s credit card or asking your landlord to report your rent payments to the three credit bureaus.
Where to check if you’re prequalified:
If you are looking for a credit card but you have poor or limited credit, secured credit cards, gas credit cards and store credit cards tend to be easier to get approved for:
Does it report to the credit bureaus?
Each credit bureau maintains a separate report of your credit history. Most credit card issuers will report your activity to the three major credit bureaus, but that’s not always the case. With some cards, your activity might only be reported to two out of three bureaus, for example. It’s best if you can get a card that reports to all three, because then no matter which credit report lenders pull when you apply for other credit products later, they’ll see your history of responsible spending and on-time payments.
Can I earn my deposit back?
If you get a secured card, a nice feature is the opportunity to graduate to an unsecured card with good behavior and get your deposit back. Some issuers offer automatic account reviews within a specified time period (e.g., starting at six months) to have your deposit refunded. Not all secured cards offer this, but many do.
Are the fees and other terms clear?
We typically recommend against unsecured cards targeted at people with bad credit because they may charge expensive fees and come with opaque terms. So, first, you want to make sure you’re clear on what you’re getting when you apply for a new card. And, second, you want to make sure any fees that you’re charged are reasonable. In many cases, building credit with a secured card that charges no annual fee is your best option. You’ll have to submit a deposit, but it can be more affordable in the long run.
When you have bad credit and you’re looking for ways to rebuild, you need to be on high alert to avoid scams and predatory credit products. Be on the lookout for credit repair scams (a scam where someone tells you they can fix your credit quickly, or get negative information removed from your credit reports). You can take many steps to repair your credit on your own. And if you’re feeling overwhelmed, there are legitimate nonprofit credit counselors who may be able to help.
Using a credit card for a year or more can be a good way to rebuild credit. However, you should also be wary of many credit products marketed to people with bad credit. These may be legitimate products, but can cost you money and cause frustration through expensive fees, high interest rates and opaque terms. We typically recommend avoiding unsecured cards for bad credit for these reasons.
Beware of fees such as:
Tip: Credit One, First Premier, Horizon Card Services and Total Visa are examples of companies that may offer credit products that you should steer clear of. Instead, opt for a secured card with clear terms and a low or no annual fee. Putting together the initial deposit amount might not be easy, but you’ll likely save money in the long run.When you have a bad credit score, using a credit card responsibly is one way to help rebuild your credit. And since your credit is not in the best shape, getting a credit card to rebuild your credit is one of the few affordable options you have since lenders will likely not consider you for a loan until your credit score rebounds. Lenders want to see that if they extend you credit, you’ll pay back what you borrow, and payment history is the most important factor affecting your credit score. To build a solid payment history, put a small recurring charge on your credit card (a Netflix or Spotify subscription, for example) and pay it off in full as soon as it posts to your account each month.
Yes, but your options are limited if you don’t have good credit. Furthermore, many unsecured credit cards geared toward people in the lower credit ranges are saddled with expensive fees. The AvantCard Credit Card and Petal® 1 No Annual Fee Visa® Credit Card are two more affordable options that are designed for people with lower credit scores and don’t require a security deposit. Building back your credit with one of those cards — or a secured credit card with a deposit — can help you get approved for other unsecured cards later on.
Credit cards are a useful tool that can help you rebuild from bad credit. However, if you don’t want a credit card — or can’t get a credit card — another option to consider is a credit builder loan. You may be able to apply for a credit builder loan from credit unions, smaller banks and online lenders. Though it’s called a “loan,” you don’t get money upfront. You’ll make payments of a set amount over a certain period of time, and when you’ve paid in full you’ll get your money back (minus any fees the financial institution charges). Your payment history gets reported to the credit bureaus, which helps you build credit.
Most credit cards do not ask for detailed bank account information on the application itself. This means that it is possible to get a credit card without having a bank account. However, it may be difficult to regularly pay your credit card account each month without a bank account. You may consider a card like the OpenSky® Secured Visa® Credit Card, which does not do a credit check when you apply and allows you to fund your card via Western Union.
Closing a credit card can harm your credit score by impacting the overall age of your accounts and your credit utilization ratio. It is best to keep credit cards open as long as you handle your accounts responsibly by keeping balances low and making on-time payments.
In selecting the best credit cards for bad credit, we opted for cards accessible to people with poor credit histories, but avoided any cards that hit cardholders with opaque terms and expensive fees.
Many of the cards on this list charge no annual fee; those that do come with an annual fee offer enough value to make the fee worth it in certain situations.
Finally, all of the cards on this list report activity to the credit bureaus, meaning using them responsibly can help improve your credit score.
For Capital One products listed on this page, some of the above benefits are provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply
The above offers and/or promotions may have since changed, expired, or is no longer available. Check the Issuers’ website for more details.
