Writer: Brittney Mayer
Editor: Lillian Guevara-Castro
Reviewer: Ashley Fricker
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With all the options on the market today, finding credit cards for a 500 credit score is not impossible, although it may be more challenging than landing a high-limit card with a top-tier credit score.
But it’s not an even split. Though technically near the halfway mark, credit scores below 600 are usually considered to be poor, and scores at or below 500 easily qualify as bad credit. But while a credit score of 500 or less can make your financial life more difficult, it doesn’t have to exclude you from credit entirely.
Unsecured | Secured | Prepaid | FAQs
Best Unsecured Cards For People With a 500 Credit Score
On the surface, unsecured credit cards — those that don’t require a deposit or another form of collateral to open — seem like the better option because you don’t need to make a big deposit to open the account. However, unsecured credit cards designed for consumers with bad credit will typically charge much higher rates and fees than secured cards.
At the same time, not everyone can afford to simply allow hundreds of dollars to sit in a locked account for months or years, making unsecured cards the only real option. Some of our best unsecured cards for bad credit will accept a wide range of credit scores, including those at or below 500.
- Up to $1,000 Initial Credit Limit
- See if you Pre-Qualify with No Impact to your Credit Score
- Less than perfect credit? We understand. The Surge Mastercard is ideal for people looking to rebuild their credit.
- Unsecured credit card requires No Security Deposit
- Perfect card for everyday purchases and unexpected expenses
- Monthly reporting to the three major credit bureaus
- Use your card everywhere Mastercard is accepted at millions of locations
- Enjoy peace of mind with Mastercard Zero Liability Protection for unauthorized purchases (subject to Mastercard guidelines)
- Apply with Confidence! There is no impact to your credit score if you’re not approved. See terms.
| Application Length | Interest Rate | Reports Monthly | Reputation Score |
|---|---|---|---|
| 5 minutes | 35.90% Fixed | Yes | 8.5/10 |
- Earn Cash Back Rewards* – 3% on Eligible Gas, Groceries, and Utilities, and 1% on All Other Eligible Purchases
- Up to $1,000 credit limit subject to credit approval
- Prequalify** without affecting your credit score
- No security deposit
- Free Access to your Credit Score†
*See Program Terms for important information about the cash back rewards program.
** Prequalify means that you authorize us to make a soft inquiry into your credit history (that will not affect your credit) to create an offer. If you accept an offer a hard inquiry will be made. Final approval is not guaranteed if you do not meet all applicable criteria (including adequate proof of ability to repay). Income verification through access to your bank account information may be required.
† Your credit score will be available in your online account starting 60 days after your account is opened. (Registration required.) The free VantageScore 4.0 credit score provided by TransUnion® is for educational purposes only. This score may not be used by The Bank of Missouri (the issuer of this card) or other creditors to make credit decisions.
| Application Length | Interest Rate | Reports Monthly | Reputation Score |
|---|---|---|---|
| 7 minutes | 36% Fixed | Yes | 8.0/10 |
- Earn Cash Back Rewards* – 3% on Eligible Gas, Groceries, and Utilities, and 1% on All Other Eligible Purchases
- Use Anywhere Mastercard is Accepted
- No Security Deposit
- $0 fraud liability**
- Free access to your Credit Score†
*See Program Terms for important information about the cash back rewards program.
**Fraud liability subject to Mastercard rules.
† Your credit score will be available in your online account starting 60 days after your account is opened. (Registration required.) The free VantageScore 4.0 credit score provided by TransUnion® is for educational purposes only. This score may not be used by The Bank of Missouri (the issuer of this card) or other creditors to make credit decisions.
| Application Length | Interest Rate | Reports Monthly | Reputation Score |
|---|---|---|---|
| 7 minutes | 36% Fixed | Yes | 8.0/10 |
Although you won’t need to make a deposit for an unsecured credit card, keep an eye on the various fees you may wind up paying. Many unsecured subprime cards will charge relatively high annual fees, as well as often charging a processing fee to open the credit account and a monthly maintenance fee after the first year.
Interest rates for unsecured subprime cards are also generally very high, with an interest rate above 25% not uncommon. This can make carrying a balance extremely expensive as interest fees start adding up, so it’s best to pay your balance in full each month to avoid the fees.
Of course, you’ll need to check the card’s terms and conditions to ensure it has a grace period on interest if you want to avoid all interest fees. With a grace period, you won’t be charged interest on your purchases so long as you pay the balance in full before the due date.
Another reason to pay your unsecured card balance in full each month is the low limits. Most unsecured subprime cards will cap your credit limit at a low amount — $300 is common — which can cause your credit utilization rate (how much credit you use versus how much you have) to skyrocket will only a few purchases. Keep your balances low to maintain a healthy credit utilization rate.
Best Secured Cards For People With a 500 Credit Score
Your credit profile is the tool lenders use to judge your creditworthiness, or how likely you are to repay any money you borrow. Low credit scores indicate a limited credit history or a bad credit history — either of which makes lenders nervous. Since nervous lenders are less likely to approve your application, this makes it harder to get new credit (and more expensive when you do).
That’s where secured credit cards can make life easier. A secured credit card requires a cash deposit that acts as collateral for the account, reducing the risk to the lender.
With less risk with which to contend, lenders are more open to applicants with low credit scores. Moreover, our top-rated secured cards for bad credit have no minimum credit score requirements.
- No minimum balance requirements*
- No credit check**
- 2% cash back on category of choice with direct deposit***
- The perks of credit building meet the best of banking****
- Chime Checking Account required to apply for the Chime Visa® Credit Card
- Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC. The secured Chime Visa® Credit Card is issued by The Bancorp Bank, N.A. or Stride Bank, N.A. pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa credit cards are accepted. Please see the back of your Card for its issuing bank. *Money added to Chime CardTM will be held in a secured deposit account as collateral for your Chime Card, and you can spend up to this amount. You can use money deposited in your Secured Deposit Account to pay off your charges at the end of every month. **Out-of-network ATM withdrawal and over the counter advance fees may apply. ***With a qualifying direct deposit, earn 2% cash back on category of choice on eligible secured Chime Visa® Credit Card purchases. ****On-time payment history may have a positive impact on your credit score. Late payment may negatively impact your credit score. Results may vary.
| Application Length | Interest Rate | Reports Monthly | Reputation Score |
|---|---|---|---|
| 5 minutes | N/A | Yes | 9.5 |
- The secured Self Visa® Credit Card* requires no credit check or minimum score.
- Reports to all 3 major credit bureaus to establish and build credit, with free access to your credit score.
- Secure your credit line with a refundable security deposit as low as $100.**
- Deposits are returned upon account closure after settling outstanding balances.
- *The secured Self Visa® Credit Card is issued by Lead Bank, Sunrise Banks, N.A., or First Century Bank, N.A., each Member FDIC.
- **Qualification for the secured Self Visa® Credit Card is based on meeting eligibility requirements, including income and expense requirements and establishment of security interest. Criteria subject to change.
| Application Length | Interest Rate | Reports Monthly | Reputation Score |
|---|---|---|---|
| 3+ minutes | 27.49% Variable APR | Yes | 9.5/10 |
- Earn up to 10% cash back on everyday purchases
- No credit check required – 89% approval rate with zero credit risk to apply!
- Boost your credit score fast—2 out of 3 opensky® cardholders see an average increase of 47 points after 6 months
- Track your progress with free access to your FICO® score in our mobile app
- Build your credit history with reporting to all three major credit bureaus: Experian, Equifax, and TransUnion
- Seamless payments—add your card to Apple Pay, Google Pay, and Samsung Pay
- Start with just $200—secure your credit line with a refundable deposit
- Fast and easy application—apply in minutes with our mobile-first experience
- Flexible payment options—pick a due date that works for you
- More time to fund—spread your security deposit over 60 days with layaway
- Join 1.6 million+ cardholders who have used opensky® to build better credit!
| Application Length | Interest Rate | Reports Monthly | Reputation Score |
|---|---|---|---|
| 9 minutes | 23.89% (variable) | Yes | 7.0/10 |
To open a secured card, you’ll need to make at least the minimum required deposit. Your deposit will be placed in a secured savings account with the card issuer and remain untouched so long as your credit account stays in good standing. You can get a full refund on your deposit simply by closing your credit card account with a $0 balance.
With most secured credit cards, the amount you deposit will determine the size of your credit limit. For instance, making a $500 deposit will typically unlock a $500 credit line.
It’s important to note that your deposit will not be used to pay your monthly bill or to otherwise cover any purchases or fees. You’ll still need to make at least the minimum required payment each month before your due date to keep your account current.
Your deposit will only be used to pay your outstanding balance if you default on the card account and the account is closed by the issuer with a non-zero balance. However, defaulting on a credit card is a serious problem that can cause significant damage to your credit score, so it’s best to avoid it if at all possible.
Best Prepaid Cards For People With a 500 Credit Score
In today’s world, it’s nearly impossible to get by without some form of plastic payment method; if you don’t have a credit card, you often need at least a debit card for things like online shopping or renting a car or hotel room. However, some folks want to avoid using credit cards or their bank cards for purchases due to fears of fraud or theft.
A prepaid card can be a good solution for those consumers who don’t want a credit card. To use a prepaid card, you simply add funds to the account and then start making purchases. When the funds run out, you can reload the card and continue to make purchases.
Our top-rated prepaid cards can be used to make purchases anywhere their network is accepted.
- Greenlight is a debit card for kids, managed by parents
- Parents set flexible controls and receive real-time alerts while kids monitor their balances, set goals, and learn how to manage money
- Feel secure knowing Greenlight blocks unsafe spending categories
- Receive Mastercard’s Zero Liability Protection
- Upload a photo of your choice to create a unique custom card
- Debit cards are FDIC-insured up to $250,000
- Easily turn your Greenlight card on or off and receive real-time spending notifications
| Application Length | Interest Rate | Reports Monthly | Reputation Score |
|---|---|---|---|
| 5 minutes | N/A (Prepaid) | No | 7.0/10.0 |
One thing to understand is that prepaid cards aren’t attached to a line of credit. You load the funds used to make purchases onto the card before you start swiping, so you never have to “borrow” money to complete a transaction as you would with a regular credit card.
On the one hand, the lack of credit association means your credit profile won’t be an impediment to obtaining a prepaid card, and your prepaid card won’t impact your credit score at all. On the other hand, it also means that the account can’t be used to establish your credit profile or build credit history.
In addition to not being able to build credit, fees can be another big downside to prepaid cards. Depending on the specific card and payment option you select, you’ll either pay a fee each time you use your card — a fee that can vary based on whether it is a signature or PIN transaction — or you’ll pay a monthly fee, usually between $5 and $10.
Some prepaid cards will also charge fees for non-transactional uses of your card, such as checking your balance at an ATM or withdrawing cash. Additionally, the methods (and cost) of reloading your card will vary; some prepaid cards have partnerships with major retailers that can make reloading easier.
FAQs About Having a 500 Credit Score
Although personal finance information is more easily accessible than ever, financial education is still woefully lacking in the US.
According to one study, as many as two-thirds of Americans can’t pass a basic financial literacy test, and in a separate study, nearly 25% of millennials who were asked to describe what a credit score is couldn’t do so correctly.
In other words, if you find yourself with a lot of questions about credit — you’re not alone. Unfortunately, that lack of credit knowledge can make it all too easy to wind up with bad credit. To help make sense of your score, we’ve answered some common questions about having a credit score of 500 or below.
Is a 500 Credit Score Good or Bad?
Perhaps one of the most confusing aspects of consumer credit scores is that there are so many different types of scores. Your credit score can vary based on everything from the credit bureau that furnishes the information to the scoring model used to calculate the actual score.
The Fair Isaac Corporation, better known as FICO, is the largest credit scoring agency in the U.S., and most lenders will use some version of a FICO credit score when evaluating credit applications. Among the various FICO credit scores (there are dozens), the FICO Score 8 is the most common.
VantageScore is the second big player in consumer credit scores. Many free or “educational” credit scores — such as those offered by third-party services like Credit Karma — are based on the VantageScore 3.0 scoring model, though there are several model versions.
Both the FICO Score 8 and the VantageScore 3.0 have their own specific credit score ranks and levels, but each uses the same basic 300 to 850 range. On both ranges, the higher the score, the better, with 850 being the absolute best possible credit score.
FICO typically considered any credit score below 580 to be subprime, while VantageScore draws the subprime line at scores below 650. This means that credit scores of 500 and below are firmly in the bad credit category no matter which model is used to calculate your score.
What Causes a 500 Credit Score?
In an ideal world, we’d all start out with perfect credit scores. In actuality, we all start out with a bad credit score and have to work our way up from there.
With that in mind, credit scores of 500 and below can be the result of one of two things: not enough credit history or bad credit history. When you first start building credit — likely with a single credit card — it takes six months to build up enough credit history that you can get a credit score.
Even if you do everything perfectly for those six months, your initial credit score is likely going to be bad. At the very least, don’t expect to see a figure above 600. With smart credit behaviors, including always paying on time and maintaining low balances, you should see your credit score improve.
If you’ve already been at the credit game for a while, a poor credit score is likely the result of some bad financial decisions or credit mistakes. Missed payments are a common source of bad credit, as even a single delinquent payment (more than 60 days past due) reported to the bureaus can cause your credit score to plummet.
In fact, your payment history is the single largest factor in your credit score, accounting for 35% of the calculation. Having credit cards that are maxed out (or close to) and opening too many credit cards at once can also cause your credit score to decrease.
How Much Can I Borrow With a 500 Credit Score?
The typical credit limit for an unsecured card for bad credit is somewhere between $300 and $1,000. Secured cards can go as high as $5,000 or more, but you must place an equal amount into a security deposit account.
Subprime borrowers seeking a personal loan may be offered small loans of up to $2,500 or so, depending on where the loan is obtained and their monthly income.
Credit cards are good for recurring spending. But a personal loan may be a better option if you need cash for an immediate expense because of a credit card’s initial low spending limit. Plus, when you max out your credit card’s available credit limit, you hurt your credit utilization ratio and, consequently, your credit scores.
How Do You Improve a Low Credit Score?
The best way to increase a credit score of 500 or below will depend primarily on how you got a low score in the first place. For instance, if your low credit score is due to having a thin credit profile, then simply building up a positive credit history over time should help your credit score increase.
If, however, your poor credit score is due to some financial mistakes, you’ll need to analyze your credit reports and build a plan. Make sure you check all three of your credit reports (you have one credit report from each major credit bureau: Equifax, Experian, and TransUnion) to get a complete picture of your credit history.
You can do this for free at AnnualCreditReport.com.
Having cards with high utilization rates — the ratio of how much credit you are using over how much you have available — will also drop your score, especially if you have credit cards that are maxed out. Paying down these balances can do a lot to boost your credit score.
Of course, your payment history is the largest factor in your score, meaning things like delinquent payments or defaulted accounts can really hurt your credit scores. While payments that are a day or two late won’t cause your score to decrease, anything that is 60 days or more past due will be reported to the credit bureaus as delinquent.
Most negative accounts can stay on your credit reports for up to seven years, so that delinquent payment from several years ago will still be hanging around for several more years. The upside is that those accounts should lose some of their impact on your credit score as they age, especially when replaced by positive payment history.
A Low Score Doesn’t Erase All of Your Options
If all of life were a game of golf, then a sub-500 credit score would put you near the front of the pack. Sadly, consumer credit isn’t scored like golf, and a low credit score doesn’t get you a special jacket — it gets you high interest rates.
That being said, while having a low credit score can be a challenge, it doesn’t mean that all lenders will write you off as a waste of time. With a little research, you can find credit card issuers willing to take a chance on your bad credit so that you can work to improve your credit scores — and your financial future.
Range of credit scores covered in this article: 500, 501, 502, 503, 504, 505, 506, 507, 508, 509, 510, 511, 512, 513, 514, 515, 516, 517, 518, 519, 520, 521, 522, 523, 524, 525, 526, 527, 528, 529, 530, 531, 532, 533, 534, 535, 536, 537, 538, 539, 540, 541, 542, 543, 544, 545, 546, 547, 548, 549, and 550 credit score.
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