Have bad credit? Consider a card designed to help you rebuild your credit history and improve your score. But heads up - some may have a security deposit or fee. New to credit cards? See offers from our partners for students or those with no credit. Looking for more? Go to CreditCards.com to browse card offers for other categories like 0% APR and cash back, or check out our expert's list of the best credit cards of 2018.
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Updated: March 15, 2018
Here’s the good news about bad credit – it’s a temporary state. No matter how low your credit, with a change in habits and consistency, you can improve your score within months. Here, we look at:
Not sure where to start? We can help.
Credit building. The greatest advantage to a card for bad credit is that you can build your credit. That said, make sure your card issuer reports your good credit habits to the 3 major credit bureaus.
No annual fee. Cards for bad credit or no credit will sometimes be offered with no annual fee.
Unsecured credit. Some secured cards will evaluate your credit after several months to see if you qualify for an unsecured line of credit. In some cases, you can get an unsecured card right away for bad credit, although there may be fees.
Rewards. For example, the Discover it Secured Card lets you earn 2% cash back on restaurants and gas stations on up to $1,000 in combined purchases per quarter. It’s 1% back on all other purchases.
Choose your payment date. The Credit One Visa Credit Card allows you to pick the date when your payment is due.
FICO score. Some cards, such as the First Premier Bank Mastercard, provide your quarterly FICO score on your monthly statement.
No processing or application fees. Some cards for bad credit don’t charge processing or application fees.
Car rentals and hotels. Many hotels and car rental businesses require a credit card to make reservations or require you to present one when you arrive. A credit card for bad credit can be used for that, although you want to make sure the company doesn’t put a hold on your card that exceeds you credit limit.
The single most important aspect of building credit is on-time payments. It takes months to build good habits (and a good score). It takes one late payment to drop your score as much as 100 points. You can also face late fees and a rise in your interest rate for late payments.
To keep your account active, place a small charge on your card each month. You can’t build credit if your card is canceled for inactivity.
The second most important aspect of building credit is your utilization ratio, which is your balance by your available credit. You want to keep it as low as possible. How? By paying in full each month.
While you’re at it, pay in full multiple times a month, because you don’t know when the issuer will send your data to the credit bureaus. Also, because you have a low credit limit with a starter card, you have less room for maintaining a low utilization ratio. If you have $500 in available credit, and you have a balance of $250, that means your ratio is at 50%, which is much too high. You want the ratio as close to 0% as possible.
Regularly check your credit with the 3 major credit bureaus for errors. Have the bureaus correct any errors you find.
|Best For...||Card||Annual Fee||Deposit Requirement|
|Building credit||Capital One® Secured Mastercard®||$0||$49, $99, or $200 (Refundable)|
|Cash back||Discover it® Secured Card||$0||$200 (Refundable)|
|Groceries||Credit One Bank® Visa® Credit Card||$0 - $99||None|
|Easy application||Total VISA® Unsecured Credit Card||See Terms*||None|
|Chip technology||First PREMIER® Bank Mastercard® Credit Card||See Issuer Website||None|
|Growing credit line||Credit One Bank® Unsecured Visa® with Cash Back Rewards||$0 - $99||None|
|Fast response||Milestone® Gold Mastercard®||$35 - $99||See Issuer Website|
|No deposit||Credit One Bank® Unsecured Visa® with Free Credit Score Tracking||$35||$200 or more (Refundable)|
|$0 Fraud Liability||Credit One Bank® Unsecured Platinum Visa®||$0 - $99||See Issuer Website|
|Quick decision||Fingerhut Credit Account issued by WebBank||$0||See Issuer Website|
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