Best Credit Cards for Bad Credit 2019

Brendan Harkness

Author

Brendan Harkness

Updated Jan 13, 2019

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Best Secured Cards for Bad Credit

With bad, limited, or no credit, secured credit cards will be some of your best options.

By providing a security deposit to fund the credit limit, you reduce the risk for the credit card issuer. But this doesn’t mean you’re guaranteed to be approved for secured cards. You can still be denied if your credit is bad enough, for example, or if your income is below a certain amount.

In most cases your credit line will be equal to the amount of your security deposit. Credit limits tend to be no higher than $2,000 or $3,000, and, depending on the card, your maximum limit might be based on your creditworthiness. Sometimes you can make an additional deposit later on to increase the credit limit.

Secured cards usually don’t offer rewards of any kind, although there are a few that do. In most cases they have pretty high interest rates, and very few extra benefits. These cards usually report to the three major credit bureaus, just like most unsecured cards: Experian, Equifax, and TransUnion.

Some issuers may review your credit card account periodically, to see if you qualify to have your deposit returned or even for an upgrade to an unsecured card. But not all issuers offer this service.

Best for Earning Rewards, No Annual Fee

Why we picked this card

The Discover it Secured Credit Card (Review) actually offers a decent rewards program, unlike most secured cards. It provides 2% cash back at restaurants and gas stations, with double your cash back in the first year.

Read more about why we like the Discover it Secured Card

Best for Low Security Deposit

Why we picked this card

The Capital One Secured Mastercard (Review) will require a security deposit of $49, $99, or $200, depending on your creditworthiness. But no matter which amount you’re required to deposit, your initial credit limit will be $200. So you may be able to pay a very low deposit, if you qualify. You can also deposit more to increase the credit limit to $1,000, if you’d like.

Read more about why we like the Capital One Secured Mastercard

We're currently unable to link directly to an application for this card.

Learn more about Capital One® Secured Mastercard® »

Best for High Credit Limit

Why we picked this card

Secured cards usually come with relatively small credit limits, but the Wells Fargo Secured Visa Card breaks that trend. It has a maximum security deposit and credit line of $10,000, several times higher than most other secured cards. But you’ll need to have a Wells Fargo checking or savings account to apply for this card.

Read more about why we like the Wells Fargo Secured Visa Card

Best for No Bank Account Required

Why we picked this card

If you don’t have a bank account to transfer your security deposit, you won’t be able to apply for most secured cards. But the Citi Secured Mastercard (Review) allows you to pay the deposit by other methods, although you’ll need to visit a Citibank location in person to do this. You can also apply for the card as normal online if you do have a bank account.

Read more about why we like the Citi Secured Mastercard

Best for Military Members and Families

Why we picked this card

The USAA Secured Card American Express (Review) has an annual fee of $35, but it also offers special benefits for servicemembers. You’ll need to qualify for USAA membership to get this card.

Read more about why we like the USAA Secured Card American Express

Best Unsecured Cards for Bad Credit

Although secured cards are usually the go-to option for people with poor credit, there are also some decent unsecured cards out there. You may be able to qualify for one of these cards even if you have bad or limited credit, because card issuers take several elements into account when deciding if you’ll be approved for a card or not.

Besides just looking at your credit, issuers also want to know about your income, whether you’re a renter or a homeowner, and your employment status, among other factors.

So, don’t assume that you’ll be denied for a particular card just because of your credit scores. Sometimes people are approved for cards that they didn’t expect to be, and sometimes people are denied when they thought their credit was good enough.

Here are the best unsecured cards that are accessible for people with bad credit. You can use them to demonstrate responsible card use, and eventually qualify for something better.

Best for Earning Rewards

Why we picked this card

The Journey Student Credit Card from Capital One (Review) is a Visa designed for people with fair credit scores or limited credit histories, like other student credit cards. But unlike most other student cards, you don’t actually need to be a student to apply for this card.

That makes it worth trying for anyone with poor or limited credit, who is looking to rebuild. You’ll even earn some cash back:

  • 1% cash back for every purchase
    • pay on time and that goes up to 1.25% cash back

So you can expect to get 1.25% cash back with this card, as long as you use it responsibly. Payments should always be made on time, of course, and this is even more important if you’re trying to improve your credit.

You can get an automatic credit line increase with this card after making your first five monthly payments on time. And there’s the Capital One CreditWise tool, providing free access to your VantageScore 3.0 credit score, based on your TransUnion credit report. Tips for improving your credit scores are included. CreditWise also provides access to your actual TransUnion credit report, something that other issuers don’t do.

There are some other basic protections too. All this comes for no annual fee, and there are no foreign transaction fees either.

The Journey Student card can be a very cheap way to build up your credit scores, earning 1.25% cash back on everything you buy.

Read more in our Review of the Journey Student Credit Card from Capital One

We're currently unable to link directly to an application for this card.

Learn more about Journey® Student Rewards from Capital One® »

Best for Credit Building

Why we picked this card

The Capital One® Platinum Credit Card (Review) is a simple credit card, designed with one purpose in mind: to help you improve your credit scores.

There are no spending rewards or signup bonus, but the benefits are not too bad for a card like this. The most relevant, for most people, will probably be access to a higher credit line. After paying your first five monthly statements you’ll be given a larger credit limit.

This is a Platinum Mastercard, and comes with benefits like Price Protection, Extended Warranties, and Auto Rental Collision Damage Waivers.

Cardholders can access Capital One’s CreditWise service using their normal login info, which provides credit monitoring on TransUnion credit reports. CreditWise provides a pretty comprehensive monitoring service, which includes VantageScores and comprehensive details from TransUnion credit reports.

There’s no annual fee for the Platinum card. And like all cards from Capital One, it has no foreign transaction fees.

Read more in our Review of the Capital One Platinum Credit Card

We're currently unable to link directly to an application for this card.

Learn more about Capital One® Platinum Credit Card »

Is a Bad Credit Credit Card Right for You?

If you have bad credit (a FICO 8 Credit Score of around 660 or less) you won’t be able to qualify for the best credit card offers on the market. Instead, you’ll usually need to settle for a card with higher interest rates and fewer features until your credit improves.

You still have quite a few card options available to you, however:

  • Secured credit cards
  • Unsecured credit cards designed for average to bad credit
  • Store credit cards

In most cases it will be easiest for you to qualify for a secured credit card, which will require a security deposit. This deposit will fund your credit limit.

There are also some unsecured credit cards designed for poor credit, but these options are more limited. Many of them have very high fees and below-average customer service.

Lastly, there are store credit cards. These cards usually have lower credit requirements, making them easier to get. But they tend to be restricted in how you can use them, and they don’t always have the best customer service either.

If you’re a student, you have access to special cards designed for young people who are just starting to build up their credit. Take a look at our picks for the Best Credit Cards for College Students.

You can also consider checking your local bank or credit union for their credit card offers. In some cases you may be able to leverage your existing relationship to help qualify for a card.

Maybe your credit is right on the edge of bad and fair, or you’re not very far below 660. If that’s the case you may qualify for cards designed for fair or average credit, depending on your particular finances.

Not sure if you’ll be approved for a particular credit card? You can check to see if you’re pre-qualified without harming your credit scores. This is a great way to shop around — you may find that you’re pre-approved for cards that you thought were out of your league!

Using a secured or lower-end credit card is not a bad thing. As long as you use your card and other credit accounts responsibly, your credit will improve and you’ll be able to qualify for cards with much better rewards.

Selection Criteria: What Makes a Great Credit Card for Bad Credit?

You may not have the best credit, but that doesn’t mean you have to apply for the first credit card offer that comes your way. It will still benefit you to survey your options, and look for a card with the most favorable terms you can get.

  • No annual fee, or a reasonable fee: You might have to pay a fee to improve your credit, but it doesn’t have to be very big.
  • No extra costs: Some cards for poor credit have signup fees or monthly fees, usually in addition to a high annual fee. But you can usually avoid cards like these.
  • Good customer support: Credit card companies aren’t always known for their excellent customer support, but you should be able to get help when you need it.
  • A modern, quick payment system: Paying your bill should be easy, and it shouldn’t take too long to process.
  • Rewards, in some cases: Most cards for bad credit don’t offer rewards, but occasionally you’ll find some that do.
  • Additional benefits: Credit cards usually come with some basic benefits, like Purchase Protection, but sometimes you’ll find cards that offer more.

Cards with No Credit Check Required

Some secured cards don’t require a credit check when you apply, making them very easy to get no matter what your credit scores might be. But in return for that they also have fees, and are known to have poor customer support. In some cases the payment process may be quite slow, causing late payments which could damage your credit.

A few examples are:

We don’t recommend these cards. But if you can’t get approved for other secured cards, these may be worth exploring as a last resort.

Store Credit Cards

Store cards are generally easier to get than regular credit cards, with lower credit requirements. But they also usually have higher interest rates, and may have some different rules about how and where you can use them. Your credit line will usually be smaller than what you get with other reward cards.

If you shop at a particular store very often and they offer a credit card, it could be a good idea to use that card. As long as you completely understand the terms and use it responsibly, you’ll improve your credit and can move on to better cards if you’d like.

Sometimes these cards are connected with a payment network, like Visa or Mastercard. But in other cases they aren’t. This is important, because unless your card is part of a network like Visa you can only use it at the store it’s associated with.

Take a moment to watch our video below on a few of the most important things to know about store credit cards. If you decide that one is right for you, learn more about store credit cards and then check out our picks for the Best Store Cards. You can also browse a full list of cards issued by Comenity Bank, a major provider of store cards.

Store credit cards can be a good way to build or rebuild your credit and get some rewards while shopping, as long as you’re sure to follow the terms and pay them off on time. In some cases, store cards have special financing deals that you need to pay very close attention to, or you can end up getting burned with retroactive interest charges. If you’re not careful, not only will you end up paying more for interest, you can also do damage to your credit scores.

So always use your cards responsibly, and keep an eye on your credit scores too. In time, you’ll be able to qualify for some great credit cards.

How to Build or Rebuild Credit With Credit Cards

  • Always pay your bills on time. Make at least the minimum monthly payments.
  • We recommend paying more than just the minimum payment. Try to pay off your balance in full each month to avoid interest and help your credit utilization.
  • Set up autopay on your cards so you’re never late on payments.
  • Be patient. The only way to establish a positive credit history is to consistently make on-time payments over a long period.
  • Track your credit scores using a free credit monitoring service to be sure that you’re making progress, and to get specific tips based on your credit reports. Discover and Capital One both have free credit monitoring tools for non-cardholders.
  • As your credit improves with responsible card use, eventually you’ll be able to qualify for more rewarding credit cards. You can always check to see if you’re pre-qualified for any cards without hurting your credit scores at all.
Establishing a positive, robust credit history is pretty simple overall, but it takes some time and dedication. Learn everything you need to know about improving your credit scores in our Definitive Guide to Building Credit with Credit Cards.

Credit Builder Loans

Another good way to build or improve your credit is through credit builder loans. This is a type of installment loan, and you can use it along with or instead of a credit card to raise your credit scores.

Unlike other installment loans, the funds for a credit builder loan go into a special account that you can’t access. You’ll make a regular payment each month to “pay off” the loan, generating a positive record of activity which the lender will report to the major credit bureaus.

After paying off the entire amount of the loan, you’ll get the money that was placed in the special account. It’s a bit like a loan in reverse, which requires you to pay it off in full before you can access the funds. It gives you a chance to lay down a history of on-time payments, showing that you’re a responsible credit user.

Learn more about credit builder loans offered by Self Lender

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