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The Discover it Secured Credit Card charges a $0 annual fee and earns cash back rewards. It reports your payment activity to the major credit bureaus and offers the opportunity to graduate to an unsecured card
Having a bad credit score can be inconvenient and expensive. Not only does it keep you from getting the best credit cards and loans, credit cards for bad credit tend to have higher interest rates and fewer perks like sign-up bonuses or rewards programs.
Fortunately there are credit cards for bad credit that have no annual fees, reasonable APRs, solid rewards and report to all three credit bureaus. Among our list of the best credit cards for bad credit you’ll notice that some are secured and some are unsecured.
Secured credit cards require you to put down money to secure your card’s credit line, often around $200, and tend to be the easiest to open. Unsecured credit cards don’t require a deposit but rather use your credit score to determine your line of credit.
As you use your card responsibly, you can build your credit score and eventually upgrade to a card that offers even more valuable rewards and benefits.
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Deposit required: $200
Credit limit will equal your deposit and ranges from $200 to $2,500.
The Discover it® Secured Credit Card hits everything you’d want in a secured credit card for poor/limited credit: a $0 annual fee, credit bureau reporting and cash back on every purchase. It’s also our top choice for students with bad credit.
You’ll have to put down a $200 minimum deposit to secure a credit line. 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 credit card.
Deposit required: $200
Credit limit will equal your deposit and range from $200 to $3,000.
The Capital One Quicksilver Secured Cash Rewards Credit Card offers a simple cash back rate on everyday purchases, which is rare with cards for bad credit. 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, this $0 annual fee card offers automatic credit line reviews starting at six months to determine if you qualify for a higher credit line.
Deposit required: $49 to $200
Initial credit limit of $200 with a $49, $99 or $200 deposit.
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.
You can also raise your initial credit line by making a larger deposit — up to a maximum of $1,000. After six months of demonstrating responsible card usage, Capital One will review your eligibility for an increased credit limit.
Deposit required: $100
Credit limit will equal your deposit and ranges from $100 to $1,000.
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.
The Amazon Secured Card is accessible with a deposit as low as $100. The card also offers an opportunity to earn 2% back at Amazon.com, Amazon Fresh and more, with an eligible Prime membership. The main downside is that you cannot use it outside Amazon and select Amazon brands.
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Deposit required: None
Credit limit of $300 to $3,000 with no deposit.
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. Rather than putting down a security deposit, you’ll pay a $59 annual fee. This option avoids tying up cash that you could use for expenses, but avoid carrying a balance because this card comes with a high APR of 30.24% (variable).
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Deposit required: $200
Credit limit will equal your deposit and ranges from $200 to $3,000.
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, since it doesn’t require a credit check when you apply. It charges a $35 annual fee and has a regular APR of 25.64% (variable). The card also requires a refundable security deposit ranging from $200 to $3,000.
The card does not require a bank account for approval, but you will have to provide some personal financial information, such as your annual income, monthly housing payment and housing payment type.
Deposit required: $1,000
Out of the few available secured credit cards for businesses, the Business Advantage Unlimited Cash Rewards Secured credit card is one of the simplest. It has a $0 annual fee and flat rewards rate, which makes it easy to rack up rewards on business purchases while building credit. Plus, Bank of America will automatically review your account to see if you can transition to an unsecured credit card. But keep in mind that the minimum deposit is $1,000 — which is pretty steep for a secured credit card.
| Credit Cards | Our Ratings | Annual Fee | Recommended Credit Credit scores ranges may vary. Your individual chance at approval may vary due to factors such as creditors using a particular variation at their discretion | Regular APR | |
|---|---|---|---|---|---|
|
Discover it® Secured Credit Card
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on Discover's secure site Rates & Fees |
Winner
|
$0 | Poor/Limited | 28.24% Variable APR |
Apply Now
on Discover's secure site Rates & Fees |
|
Amazon Secured Card
Learn More
on ABOC's secure site |
Best store credit cards for bad credit
|
$0 | Poor/Limited | 10.00% non-variable |
Learn More
on ABOC's secure site |
|
AvantCard Credit Card
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on Avant's secure site |
Best unsecured credit card for bad credit
|
$59 | Fair/Poor/Limited | 30.24% |
Apply Now
on Avant's secure site |
|
OpenSky® Secured Visa® Credit Card
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on Capital Bank, N.A.'s secure site |
Best no credit check credit cards for bad credit
|
$35 | Poor | 25.64% (variable) |
Apply Now
on Capital Bank, N.A.'s secure site |
|
Business Advantage Unlimited Cash Rewards Secured credit card
Review Coming Soon
|
Best business card for bad credit
|
$0 | N/A | 28.49% variable | Review Coming Soon |
Ask the following when evaluating a credit card for bad credit:
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.
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.
We typically recommend secured credit cards over unsecured cards targeted at people with bad credit. Unsecured cards 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.
Several secured credit cards offer you the ability to graduate to an unsecured credit card after a period of time. Typically you need to have a record of consistent, on-time payments for at least half a year, though terms vary by credit card issuer. The good thing about being “graduated” to an unsecured card is that you’ll get your deposit back and you won’t have to apply for another card. The latter is key so you can avoid having a credit check and a new line of credit appear on your credit report.
Many credit cards give you access to your VantageScore for free via your online dashboard. The ability to track your credit score can be very motivating, especially once you see how different actions cause it to rise and fall. Some card issuers offer simulators that show how much your credit change when you take out an auto loan or pay off a credit card.
There are two main credit scores that banks and lenders use to determine credit rating: the FICO Score and the VantageScore.
Any FICO Score lower than 580 is considered a bad credit score. Any number below 600 on the VantageScore scale is considered poor.
The credit scoring method most lenders use is the FICO Score, which can range from 300 to 850.
The FICO Score is the most commonly used credit score and dates back to 1989. It’s based on five areas of your financial behavior:
Each area is weighted differently and collectively determines your credit score. Data that’s reported to each of the three major credit bureaus – Equifax, Experian and TransUnion – is put into the proprietary algorithm to determine your credit score. The three-digit number then fits within one of the five credit ranges which go from poor to exceptional.
| 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 |
Less commonly used, but more accessible to you, is the VantageScore, which also ranges from 300 to 850. It also uses data from the credit bureaus but with a different calculation which may allow you to have a build credit more quickly due to the way your score is calculated.
The VantageScore was created by the three major credit bureaus and is typically available to you through your bank or credit card’s online dashboard.
| 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 |
A credit score may look like a harmless three-digit number. But, the lower your credit score is, the more you can expect to pay by way of higher interest rates and subpar, or missed, opportunities. When you have bad credit, you’ll likely have:
Just like it takes time to build good credit, it’s usually a series of actions that cause your credit score to drop. Things that contribute to a bad credit score may include:
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.
1. Check to see if you’re preapproved: Many issuers of credit cards for bad credit let you check online for prequalification or preapproval. While you aren’t guaranteed an actual approval even if you’re preapproved, this process is a good way to gauge your chances without affecting your credit score.
2. Fill out an application: Submitting your application online is likely to be the easiest way to go. Credit card issuers typically ask for personal and financial information, including your full name, address, Social Security number, annual income and housing payment.
3. Submit a security deposit if necessary: You’ll need to submit your deposit after being approved. An electronic transfer from a bank account is widely accepted as a deposit. It’s less common to be able to make your deposit by other methods, but some issuers may allow it. If paying the whole deposit at once will be difficult, check with your issuer if you’re allowed to submit it in increments.
| If you’re… | Consider this type of credit card | Here’s why | Suggested credit cards |
|---|---|---|---|
| A student |
| You may not have bad credit but rather limited or no credit. Student credit cards take this into account and while you may have to put down a deposit or have a low credit limit, you’ll be able to establish and build your credit history. | |
| New to the U.S. |
| International students, visitors and new U.S. residents may lack a SSN and/or the credit history generally needed to apply for credit. Look for a credit card that doesn’t require a SSN. Some cards will accept an ITIN while others use an alternative method to determine your creditworthiness. Additionally, you can become an authorized user on the credit card of a family member or friend who has good credit. | |
| Needing credit after a bankruptcy |
| Credit is hard to get after you’ve gone through a bankruptcy. Look for a secured credit card so you can demonstrate to the bank that you can manage your credit card well. Once your credit improves, you can move to an unsecured card. |
If you’re looking for a credit card but you have poor or limited credit, you may be looking for easy credit cards to get. Secured credit cards, gas credit cards and store credit cards tend to be easier to get approved for:
| Card type | Why it may be easy to get | Card Examples |
|---|---|---|
| Secured credit card | You put down cash to secure your line of credit so it’s less risky for banks to approve you for a secured credit card. | |
| Gas credit cards | Gas station cards often have lower credit requirements which make them easier to get approved for. | |
| Store credit cards | Store credit cards are usually easy to be approved for but may be limited to purchases at that retailer. |
| Secured credit cards for bad credit | Unsecured credit cards for bad credit | |
|---|---|---|
| Report activity to the credit bureaus | ||
| Can earn rewards | ||
| Require a security deposit | ||
| Often come with high fees | ||
| Credit limit based on your deposit (usually) | ||
| Credit limit based on your creditworthiness | ||
| Some don't require a credit check |
One of the most attainable options for rebuilding your credit is a secured credit card. They differ from non-secured credit cards because they typically require a refundable minimum deposit that acts as your credit line. Secured cards usually lack fees and are more transparent about their terms, making them the better choice for people with bad credit.
Examples of secured credit cards:
Unsecured cards — which are more common — don’t require a security deposit, so their credit limits tend to be much higher since they’re not dependent on how much you put down. However, many unsecured credit cards designed for people with bad credit have expensive fees and bad terms, like no grace period.
Examples of unsecured credit cards:
Using a credit card responsibly is a great way to help rebuild your credit. Lenders will report your credit behavior to the three major credit bureaus – Equifax, Experian and TransUnion. Your credit score is then generated from the information in your reports.
You can repair your credit on your own with a little patience and grit. Check out our list of the best credit cards to build credit and follow these tips for how to fix bad credit:
There are several ways you can check your credit score for free without hurting it, including signing up for a free LendingTree Spring 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.
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:
→ Spend only what you can afford to pay off in full. This will accomplish two things. First, it will ensure you don’t pile up credit card debt. And second, limiting how much you spend on your credit card is good for what’s known as the credit utilization ratio. A good rule of thumb is to spend no more than 30% of your credit limit — for example, spend no more than $60 at any time on a card with a $200 credit limit.
→ Use your card for small, recurring monthly charges. Issuers want to see you’re using your card, not letting it stay dormant. If you’re worried having the card in your wallet might tempt you to overspend, consider using it for a recurring monthly payment, like a HBO Max or Spotify subscription. Then, set up autopay so you never miss a payment.
→ Make sure to pay on time and in full every month. On-time payments are typically the biggest factor impacting your credit score. Payment history makes up 35% of your FICO Score and 41% of your VantageScore. We always recommend paying in full so as to avoid interest charges, but even if you can’t pay in full, you should make at least the minimum payment due so you’re not reported as late to the credit bureaus.
→ Increase your credit limit over time. Secured cards typically come with a lower credit limit. Over time as you work towards graduating to an unsecured card, you will have the chance for a higher credit limit and more flexibility to spend without impacting your credit utilization ratio.
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:
→ Putting a hard inquiry on your credit report. Each time you apply for a credit card, a hard inquiry will typically appear on your credit report. This can knock your credit score down by a few points and stay on your credit report for two years.
→ Reducing the average age of your accounts. Length of credit history makes up 15% of your FICO Score, and average age of accounts is part of this. Each time you open a new account, that average age takes a dip.
Using a credit card responsibly is a great way to help rebuild your credit. Lenders will report your credit behavior to the three major credit bureaus – Equifax, Experian and TransUnion. Your credit score is then generated from the information in your reports.
→ On time payments. This is the most important factor affecting your credit score. Payment history makes up 35% of your FICO Score and paying your card in full helps you avoid interest charges.
→ Keep your credit utilization low. This makes up 30% of your FICO Score. A credit utilization ratio is how much of your credit limit you are using. You will want to keep this number at 30% or lower.
→ Limit new applications. 15% of your FICO Score is the length of credit history, which is the average age of all accounts. Opening too many new accounts can decrease this number and it may stand out negatively to issuers. Limiting applications also prevents you from having a hard pull on your credit, which can hurt your credit score.
→ Use your card routinely. Issuers like to see that you are using your card, plus this can affect your length of credit history if you have stopped using one of your accounts.
→ Increase your credit limit over time. Secured cards typically come with a lower credit limit. Over time as you work towards graduating to an unsecured card, you will have the chance for a higher credit limit and more flexibility to spend without impacting your credit utilization ratio.
If you’re having trouble getting approved for a credit card because of your credit, don’t worry — you still have ways to build credit without a credit card in the meantime.
1. Become an authorized user on someone else’s credit card. Being an authorized user on a credit card means your name is attached to it, but you won’t be responsible for payments. Talk to someone you trust with a healthy credit history.
2. Get a credit builder loan. This is a type of small loan you make monthly payments on while the loan is held in a certificate of deposit (CD) or savings account. You can typically find them at small banks or credit unions.
3. Pay off other loans. Whether it’s student loans, personal loans or auto loans, making loan payments on time can help improve your credit score.
A poor credit score is 579 or below on the FICO scoring system. With the VantageScore, a poor credit score is 500 to 600 and a very poor credit score is 499 to 300.
If you have bad credit, the easiest credit cards to get approved for are typically secured credit cards, gas credit cards or store credit cards.
Applying for multiple credit cards can cause your credit score to drop temporarily because the credit card issuer does a hard pull of your credit report. If you already have bad credit, it’s best to apply for, and use, just one credit card so you don’t wind up in credit card debt or struggling to manage multiple cards.
Checking your own credit score doesn’t negatively impact your credit, since it only initiates a soft pull of your credit.
According to FICO, the most popular score used among lenders, a bad credit score typically ranges from 300 to 579.
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.
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. 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.
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.
The above offers and/or promotions may have since changed, expired, or is no longer available. Check the Issuers’ website for more details.
