If you don’t have good-to-excellent credit, it may seem all but impossible to find a competitive card that doesn’t charge exorbitant fees or interest rates. But a small number of competitive cards welcome a wide range of cardholders, including consumers with less-than-perfect credit.
If you don’t have good to excellent credit, it may seem all but impossible to find a competitive card that doesn’t charge exorbitant fees or interest rates.
Some offer rewards programs that are as generous as the rewards offered to consumers with great scores. But unlike many subprime cards, they don’t charge excessively high rates or fees.
Other cards are more basic and don’t offer a rewards program. But instead, they offer lower APRs and fees than many banks charge consumers with perfect credit.
Here are some of the best credit cards you can get with a less-than-perfect credit score.
See related: Best flat rate cash back credit cards
This brand new card designed for iPhone users and other Apple aficionados pairs a strong rewards rate – including 3 percent cash back on Apple purchases (plus T-Mobile, Walgreens, Duane Reade, Uber and Uber Eats purchases made via Apple Pay) and 2 percent cash back on everything you buy through Apple Pay – with sleek, well-designed budgeting features and some of the most competitive terms you can get on a widely available credit card.
In addition to a relatively low APR of 12.99 percent to 23.99 percent, the Apple credit card also waives common credit card fees, including late fees, foreign transaction fees, returned payment fees and more. But unlike most cards with comparable rewards and credit card terms, the Apple card isn’t just for consumers with good credit.
According to CNBC, Apple is also accepting select cardholders with damaged credit. For example, CNBC spoke with one consumer who was approved for an Apple card with a low limit, despite his roughly 620 credit score (which is considered risky by lenders). He was given the card’s maximum APR of 23.99 percent.
But as he noted in an interview with CNBC, Apple is charging him “a lot” less than other lenders are charging him to carry a balance. The average APR for consumers with bad credit is 25.24 percent, according to the CreditCards.com Weekly Credit Card Rate Report.
If you’re connected to the military in some way (either through your job or through a close family member), you may be able to qualify for one of Navy Federal Credit Union’s rewards cards, including this flat rate cash back card.
Like the Apple card, the Cash Rewards card accepts a wide range of cardholders, including those with average credit. It also offers a solid 1.5 percent cash back on every purchase and a strong $250 cash bonus if you spend $2,500 in the first 90 days. And because it’s a credit union card, it charges a maximum APR (18 percent) that’s well below average – especially for a rewards card.
Once your credit score gets higher, you may be able to qualify for an even lower rate: the card’s minimum APR runs as low as 11.90 percent, which is nearly six points lower than the average minimum credit card APR. Several other Navy Federal cards also grant cards to consumers with average credit, including the Navy Federal Credit Union Go Rewards credit card and the Navy Federal More Rewards American Express card.
See related: Navy Federal Credit Union’s exciting card refresh
Petal® Visa® Credit Card
You don’t even need a credit history to qualify for this unusual credit card. Instead, Petal uses its own algorithm to score potential customers. Rather than evaluate you solely on your credit score, Petal may look at other factors, such as your income and monthly expenses.
If you don’t have enough experience with credit to have a credit score – or if Petal decides your credit history gives just a limited view of your potential creditworthiness – the lender may ask you for access to your bank account so it can use your other bill payments and expenses to judge whether it can trust you with a card. (Petal will look at your credit score if you have one, though, and so you may not qualify if you have particularly bad credit.)
The Petal Visa’s maximum variable APR is on the high side and is similar to what you’ll see on other cards (29.49 percent). However, its minimum variable APR of 12.99 percent is on the low end for a rewards card and it doesn’t charge any fees, including late fees.
The Petal card also offers a unique rewards program that gets better over time: Starting out, you’ll get just 1 percent cash back on eligible purchases. But then, after six months of on-time monthly payments, you’ll get 1.25 percent cash back. If you make it a year without missing any monthly payments, you’ll get rewarded with a 1.5 percent cash back rate on eligible purchases.
A card from your local credit union
It’s also worth your time to check in with your local credit union to see if they’d be willing to offer you a competitive card. In addition to offering lower rates than nationwide banks, many credit unions also extend credit to members with less-than-perfect scores.
In some cases, you may even be able to get an exceptionally low-priced card. For example, Hawaii Federal Credit Union charges a single APR of just 10.50 percent on its Gold card for consumers with average credit and 14.88 percent on its Classic card for consumers who are “repairing” their scores.
Similarly, State Employees Credit Union offers a 9.75 percent APR to every credit union member who is approved for a SECU Visa card. If your credit is really damaged, you may also be able to qualify for a lower rate secured card from your local credit union. For example, Digital Federal Credit Union offers a secured card with a single APR of just 13.50 percent.
See related: Credit union cards: Weighing the pros and cons
Do your research before you settle on a card. When you first look up cards for consumers with average credit, you may only see cards with high APRs and fees and subpar benefits. But depending on where you live and what your financial picture looks like, you may be able to qualify for a much better card – even if you have less-than-ideal credit.
Editor’s note: This story was updated Sept. 20, 2019 to reflect the addition of T-Mobile as a 3 percent cash back category on Apple Card.