6 Best Credit Cards for Poor Credit (2020‘s Top Bad Credit Offers)

Credit Cards For Poor Credit
GUIDE
Brittney Mayer
By: Brittney Mayer
Updated: June 9, 2020
Advertiser Disclosure

Finding credit cards for poor credit histories may sound like an impossible task, but don’t lose hope. Not only can consumers with poor credit obtain certain cards, but some of the cards will also help to rebuild credit along the way. While most people recognize the importance of knowing their consumer credit score, as with many things in life, a credit score can be a matter of opinion. Whether you have “fair” credit, “poor” credit, or just plain “bad” credit will depend on exactly which scoring model — and which version of that model — is used to calculate your credit score.

Of course, regardless of which model is used to calculate your score, or which title your score is given, a low credit score is bad news. Not only does a low credit score mean you’ll see higher interest rates and fees, but it makes it more difficult to even obtain a new line of credit.

Fortunately, a number of credit card issuers specialize in providing credit opportunities to those with poor credit (or worse), offering both unsecured and secured credit cards. Those who want to make purchases with a card without dealing with credit qualifications can check out the prepaid offers. In this article, we’ll explore each of these options — unsecured, secured, and prepaid cards — to help you determine which tactic might be the best suited for your unique financial situation.

Unsecured (3) | Secured (2) | Prepaid (1)

Best Unsecured Cards for Poor Credit

Although it may be easy to forget, your credit card is, in effect, a loan. The bank backing your credit card is lending you the money you use to make credit card purchases, doing so with the understanding that you are responsible for repaying those funds in the agreed-upon time frame (i.e., by your statement’s due date).

The most common type of credit card, an unsecured card requires no security deposit or other money down to access the line of credit extended to you by the issuing bank. At the same time, because the bank has no way to guarantee it will receive that money back, unsecured credit cards come with higher interest rates and credit requirements than lines of credit secured by a deposit.

  • All credit types welcome to apply!
  • Free access to your Vantage 3.0 score From TransUnion* (When you sign up for e-statements)
  • Monthly reporting to the three major credit bureaus
  • See if you're Pre-Qualified without impacting your credit score
  • Fast and easy application process; results in seconds
  • Free online account access 24/7
  • Checking Account Required
  • Click here for official site, terms, and details.
★★★★★

4.8

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
9 Minutes See website for Details* Yes 8.5/10
  • Easy pre-qualification process with fast response
  • Less than perfect credit is okay
  • Online servicing available 24/7 at no additional cost
  • Unsecured credit card, no security deposit required
  • Account history is reported to the three major credit bureaus in the U.S.
  • Click here for official site, terms, and details.
★★★★★

4.6

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
8 Minutes 24.9% Yes 8.0/10
  • Checking Account Required
  • Fast and easy application process; response provided in seconds
  • A genuine Visa credit card accepted by merchants nationwide across the USA and online
  • Manageable monthly payments
  • $300 credit limit (subject to available credit)
  • Reports monthly to all three major credit bureaus
  • Click here for official site, terms, and details.
★★★★★

4.5

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
9 Minutes See terms Yes 8.5/10

When you apply for a credit card, the issuer will run what is called a hard credit inquiry, or credit pull, to determine your creditworthiness — even issuers offering credit cards for bad credit. Each hard credit pull will have a small negative impact on your credit score, with multiple recent hard credit pulls acting as a warning sign to potential lenders.

Credit Pull Types Diagram

If you’re unsure about whether you’ll qualify for a particular unsecured credit card, you may want to check for pre-qualification offers before risking a hard credit pull. This process will require a soft credit inquiry to get a more general idea of your credit, and will not have any effect on your credit. Pre-qualification isn’t a guarantee of acceptance, but it can be a good indicator of your chances.

Best Secured Cards for Poor Credit

While those with low credit scores can likely qualify for an unsecured credit card, you may be stuck paying large fees for the privilege. Those who would still like to build (or rebuild) their poor credit, but who don’t want to be saddled with fees — or absurdly high interest rates — can choose to obtain a secured credit card instead.

Unlike unsecured cards, secured credit cards require an initial deposit, which acts as security against the potential for default. In other words, if you don’t pay the balance on your secured credit card as agreed (paying on time and making at least the required minimum payment), the bank will use your deposit to cover its losses.

  • Invest your tax refund to improve your credit by making the refundable deposit for your new secured card today
  • Receive Your Card More Quickly with New Expedited Processing Option
  • No Credit History or Minimum Credit Score Required for Approval
  • Quick and Complete Online Application
  • Full-Feature Platinum Mastercard® Secured Credit Card
  • Nationwide Program though not yet available in NY, IA, AR, or WI *See Card Terms.
  • Apply in just a few moments with no negative impact to your credit score; no credit inquiry will be recorded in your credit bureau file
  • Click here for official site, terms, and details.
★★★

3.0

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
9 minutes 19.99% (V) Yes 7.5/10
  • Invest your tax refund to improve your credit by making the refundable deposit for your new secured card today
  • No Credit History or Minimum Credit Score Required for Approval
  • Monthly Reporting to all 3 Major Credit Bureaus to Establish Credit History
  • Credit Line Secured by Your Fully-Refundable Deposit of $200 -- $2,000 Submitted with Application
  • Nationwide Program though not yet available in NY, IA, AR, or WI *See Card Terms.
  • Apply in just a few moments with no negative impact to your credit score; no credit inquiry will be recorded in your credit bureau file
  • Click for for official site, terms, and details.
★★★

3.0

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
8 minutes 9.99% (V) Yes 7.5/10

With most secured credit cards, the amount of money you initially deposit when opening the account will also dictate your card’s credit limit. So, if you deposit $500 when you open your account, your available credit line will be $500. Many secured cards have a cap on the size of the deposit you can make, usually around $2,000 to $5,000.

Because your total available credit is one of the numbers used to calculate your utilization rate — an important factor in calculating your credit score — applicants are often encouraged to make as large a deposit as possible. This will provide you with a higher credit limit, potentially improving your credit utilization rate, which can, in turn, boost your credit score.

Best Prepaid Cards for Poor Credit

In some cases, an applicant may not want a traditional credit card, but may still wish to take advantage of many of the benefits of paying with plastic. For them, the best option may be to obtain a prepaid credit card. Similar to a secured credit card, prepaid cards require an initial deposit to use the card.

Unlike secured cards, however, a prepaid card is not actually a line of credit. Instead, a prepaid credit card behaves more like a gift card, with each purchase reducing the amount of the initial deposit until the entire amount is spent. Once empty, prepaid cards require the cardholder to reload the card, by making another deposit, to continue use.

  • With Netspend Direct Deposit, you can get paid faster than a paper check.
  • No late fees or interest charges because this is not a credit card.
  • No Overdraft Fees on purchases using your card.
  • Use the NetSpend Mobile App to manage your account on the go and get text message or email alerts (Message & data rates may apply).
  • Card issued by MetaBank®, Member FDIC. Card may be used everywhere Visa Debit cards are accepted. "Apply Now" for full details.
  • Click here for official site, terms, and details.
★★★★

3.5

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
10 Minutes N/A (Prepaid) No 7.0/10

Since prepaid cards aren’t actually credit products, obtaining and using a prepaid card will not have any impact on your credit (negative or positive). You can’t use a prepaid card to establish new credit or to rebuild existing credit, as the prepaid card issuer won’t be reporting to any of the credit bureaus.

Credit Card Types Chart

Other than having to be reloaded — and having no impact on your credit — prepaid cards act just like regular credit cards when used to make purchases. For instance, a prepaid card issued by Visa can be used to make purchases at any location that accepts Visa credit cards, including online retailers.

Responsible Credit Card Use Can Improve Your Credit Score

Depending on where you look, your creditworthiness may be displayed by a score, a color, or just an adjective. Of course, no matter if you call it “poor” or “bad” — or even just give it a bright red frowny face — having a bad credit history and low credit score is never good.

Most importantly, a low credit score is a strong indicator of financial risk to potential creditors. Even lenders specializing in subprime borrowers will check your credit to determine your creditworthiness before making a decision about your credit card or loan application, and your rates and fees will reflect this fact.

The best way to ensure you are able to qualify for the credit products you need is to build — or rebuild — a healthy credit history. A pattern of good financial behaviors over time, such as paying your credit card balance as agreed each month, will help improve your credit score, demonstrating your creditworthiness to future lenders and making you a better potential borrower.

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