For most people, the best credit cards for bad credit are secured credit cards. A low credit score indicates high credit risk, so the cash deposit you put down guarantees the credit line which lowers the issuer’s risk level. However unsecured cards also exist for consumers with bad credit. In exchange for the credit line, they tend to offset their risk level by adding fees. Each of the credit cards below have flexible credit requirements so you don’t need a good credit score to qualify. You won’t need to worry about being denied, which would result in an unnecessary hard inquiry landing on your credit report, potentially dragging your scores down even further. Once you have the most suitable credit card for your needs and circumstances, you will enjoy the convenience of safe charging and credit building. Some even offer rewards to sweeten the deal. Below are our best credit cards for poor credit. Another compelling feature of this card is that Discover automatically reviews your account seven months after opening the account. If you have treated this card responsibly by making all of your payments on time and keeping the balance under control, it will convert into an unsecured credit card. At that stage you will have your security deposit back to use or save, as well having an unsecured credit card without needing to apply for it. Another great feature is that it gives you monthly access to your FICO score. This benefit allows you to track your scoring progress. Use this card the right way, and you can watch these important scores increase over time. Pros
No credit score requirement Cash back rewardsNo annual feeAutomatic transition to unsecured card
Cons
Credit line will be low if your security deposit is lowHigh APR Few other perks associated with rewards cards
This card will be particularly appealing if you do not have the cash to put down as a security deposit. It is unsecured, so it doesn’t require collateral. Although the credit line will be low in the beginning, Credit One has a policy where the bank reviews your account activity and will give you a gradual increase if you use the account appropriately. You will be able to check your Experian credit score for free, too. It also offers a basic rewards program. Depending on what you purchase with the card, you could earn 1% cash back. As long as you keep the balance to zero, this means you can profit a little as you rebuild your credit rating. However, the annual fee is on the high side, and it goes up after the first year. Pros
No security deposit required Gradual credit line increase with positive usageCash back rewards
Cons
Annual fee that increases after the first year Steep foreign transaction feesInitial low limit restricts charging power
Though there is no penalty APR, the APR it starts out with for purchases is definitely on the high side, making it expensive if you were to roll balances over from month to month. A great feature of this card is that the initial credit limit can be higher than your security deposit. For example, if you put down $49 as security, Capital One may provide you with a $200 credit line. The bank will review your account history after six months, and if you have managed the card responsibly, your credit line should increase without needing to add to your security deposit. In addition, you can eventually reclaim your deposit, which will be returned to you as a statement credit. Pros
No annual fee Credit line can be higher than deposit Easy qualification terms
Cons
No rewards programHigh APR
Like many secured credit cards, the credit line you get will match your initial deposit. However, when you demonstrate that you can use the card well, in just three months the credit limit may exceed your deposit. After six months of paying on time and maintaining a low or no revolving balance, you will be eligible for the unsecured version of the card without having to apply for it – and your deposit will be returned to you. Other benefits of this card include a low APR and no annual or foreign transactions fees, making this a very inexpensive product. As you charge, you will earn points that you can redeem for cash, gift cards, and merchandise. Pros
Low APRNo annual, foreign transaction, balance transfer, or cash advance feesRaised credit limit in three monthsConverts to unsecured card in six months
Cons
Must become a credit union member Cash deposit required
If you can tie up a few hundred (or more) dollars for a period of time, a secured credit card may be the best option. In exchange, you may get lower fees and a better rewards program. If you don’t have or want to set the funds aside, go for an unsecured card. In exchange, you may pay higher fees and not have the same (or any) rewards program. If you want to track credit scoring progress, look for a card that gives you access to credit scores.If you can become a credit union member, look for their credit cards that were designed for members with bad credit, since they can have preferable terms.If you know you are a good credit risk but have no credit history proving that you are, look for a card that uses non-traditional qualification methods.
Capital One QuicksilverOne Cash Rewards Credit Card: Best for people with fair credit Discover it® Student Cash Back: Best for college students who haven’t yet established credit OpenSky Secured Visa: Best for people with very poor credit
