Damaged or bad credit will limit your credit card options. But there is a path to rebuilding your credit, and our list best credit cards for bad credit is the best place to get started. The cards described below are all tailored to building credit in an efficient, inexpensive manner. We consider them to be the best credit cards for bad credit because they have some of the lowest fees on the market and they all report to the major credit bureaus. While there are occasionally some unsecured options on this page, a secured credit card is your best bet if you are able to place a refundable security deposit.
Bad Credit – Security Deposit
Capital One® Secured Mastercard®
The fact that the Capital One Secured Mastercard does not charge an annual fee and has the potential to be partially-secured makes it quite attractive for many people. With a partially-secured credit card, your credit line may exceed the amount of your security deposit, thereby providing you with an emergency line of credit, if needed, and enabling you to maximize your available credit. The more credit you have available, the faster your credit standing will improve. The Secured Mastercard credit card from Capital One is therefore an option that at least merits consideration if you have bad or limited credit.
- No annual fee, and all the credit building benefits with responsible card use
- Unlike a prepaid card, it builds credit when used responsibly, with regular reporting to the 3 major credit bureaus
- Access to an authorized bank account is required to make your $49, $99 or $200 refundable security deposit
- Make the minimum required security deposit and you’ll get an initial credit line of $200. Plus, deposit more money before your account opens to get a higher credit line
- Get access to a higher credit line after making your first 5 monthly payments on time with no additional deposit needed
- Easily manage your account 24/7 with online access, by phone or using our mobile app
- It’s a credit card accepted at millions of locations worldwide
Discover it® Secured
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Not only does the Discover it Secured card lack an annual fee, but it actually offers rewards – a rare combination for the bad-credit crowd. You will earn 2% cash back on the first $1,000 you spend at restaurants and gas stations each quarter as well as 1% on everything else. And everything you earn the first year will be doubled. Plus, the card’s $200 minimum deposit is lower than what many competing offers require.
- 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases every quarter, automatically. Plus, earn unlimited 1% cash back on all other purchases.
- No Annual Fee, earn cash back, and build your credit with responsible use.
- It’s a real credit card. You can build a credit history with the three major credit bureaus. Generally, debit and prepaid cards can’t help you build a credit history.
- Establish your credit line by providing a refundable security deposit of at least $200 after being approved. Bank information must be provided when submitting your deposit.
- Automatic reviews starting at 8 months to see if we can transition you to an unsecured line of credit and return your deposit.
- Get 100% U.S. based customer service & get your free Credit Scorecard with your FICO® Credit Score
- Get an alert if we find your Social Security number on any of thousands of Dark Web sites.* Activate for free.
OpenSky® Secured Visa® Credit Card
The OpenSky Secured Card is notable not because of its $200 minimum deposit or $35 annual fee, but rather because no credit check is required for approval. That means you can begin rebuilding your credit right away, no matter how damaged it may be. And with that in mind, $35 seems like a bargain.
- No credit check necessary to apply. OpenSky believes in giving an opportunity to everyone.
- The refundable* deposit you provide becomes your credit line limit on your Visa card. Choose it yourself, from as low as $200.
- Build credit quickly. OpenSky reports to all 3 major credit bureaus.
- 99% of our customers who started without a credit score earned a credit score record with the credit bureaus in as little as 6 months.
- We have a Facebook community of people just like you; there is a forum for shared experiences, and insights from others on our Facebook Fan page. (Search “OpenSky Card” in Facebook.)
- OpenSky provides credit tips and a dedicated credit education page on our website to support you along the way.
- *View our Cardholder Agreement located at the bottom of the application page for details of the card.
CARD TO AVOID AT ALL COSTS!!
Credit One Bank® Platinum Visa
- For more detailed info read here : Is the Credit One credit card a scam?
- Secured credit cards are much cheaper. If you don’t absolutely need an emergency loan or $205 to $300 in spending power isn’t enough for your needs, you’re better off focusing on improving your credit at the lowest possible cost. That means getting a secured card instead of an unsecured offer such as the Credit One Card. Secured credit cards require a refundable security deposit, the amount of which acts as your spending limit. This reduces both your costs and the issuer’s risk. There are a number of secured cards with no annual fee, and opening one will help you improve your credit score to the point where you can qualify for a decent unsecured card.
- The APR varies widely based on creditworthiness. Your rate could be well above 20% with the Credit One Bank Credit Card, especially if you have damaged credit. But if you have damaged credit, you’ll probably be assigned a rate toward the high end of the range. As a result, you should try to pay for your charges as quickly as possible.
- Credit-line increases aren’t guaranteed. Credit One Bank says it will consider cardholders for higher credit limits based on their “overall credit performance.” They don’t elaborate about what you need to do or when you can expect a higher limit. Most cards require at least five consecutive months of on-time payments before considering an increase, but you still shouldn’t get your hopes up.
- Rewards aren’t that helpful. The roughly 1% cash back that you will earn on eligible purchases pales in comparison to the rate at which you’ll have to pay interest. And if you really want rewards, you can do better with a secured card.
Merrick Bank Visa® Credit Card
Far better secured cards are available. Before applying for the Merrick Bank Card, make sure to check out the other cards listed. In particular, the Capital One Secured Mastercard, the and the Discover it Secured Card are great options. Reading some Merrick Bank Credit Card reviews should be helpful, too, giving you a sense of what actual cardholders think of the offer and perhaps alerting you about pitfalls to avoid.
- Can be free to use, or not. Depending on your creditworthiness, the Indigo Mastercard will charge an annual fee of $0, $59, or $75 the first year and $99 after. That’s a big range, so it’s understandable if you want a card with more predictable costs. And if you don’t need an emergency loan, a secured card definitely is the way to go.
- Lets you borrow very little. The Indigo Credit Card limit is $300. That means you could have as little as $225 to spend initially, depending on the annual fee. And that could make covering emergency expenses kind of tough.
- Charges interest at a high rate. Balances carried from month to month with the Indigo Credit Card will accrue interest at an annual rate that could be above the market averages for secured credit cards and credit cards in general. So you should try to pay off amounts owed as quickly as possible.
First PREMIER® Bank Mastercard Credit Card
- Very expensive. The First PREMIER Bank Mastercard Credit Card charges an application-processing fee, an annual fee and a monthly fee. The exact amounts depend on the credit limit you’re assigned, but the processing fee could be anywhere from $25 to $95. The annual fee ranges from $75 to $125 the first year and $45 to $49 each year thereafter. And the monthly fee (waived for the first year) could be as “low” as $6.25 or as high as $10.40.Best case, you’ll have to pay roughly $290 in fees before the second anniversary of account opening. Worst case, you’ll have to shell out $404. In contrast, the average credit card would cost you about $34.7 over the first two years of use. And the best credit cards for people with the bad credit can be free to use.
- Very little payoff. Your credit limit could be anywhere from $300 to $1,000, depending on what First PREMIER thinks of your overall creditworthiness. But remember, you won’t have all of that at your disposal to start with. Given the First PREMIER Credit Card’s high fees, you may actually wind with very little extra spending power, relative to what you can afford in cash.For example, if you’re assigned a $300 credit limit, you will have to pay a $95 processing fee before opening your account and then a $75 annual fee once you do, giving you just $130 in borrowing power to work with. Such a paltry amount won’t go very far when you’re faced with emergency expenses. And emergency borrowing is the only reason for someone with bad credit to use an unsecured card instead of a secured card.
- Market’s highest APR. The costs just keep on coming when you use the First PREMIER Bank Card. Balances carried from month to month will accrue interest at a whopping high annual rate. It’s by far the highest APR on the market, and nearly double the 18.48% average among secured cards. Furthermore, as finance charges are added to your minimum monthly payment, you’ll have less and less borrowing power to work with the longer you carry a balance.
- Far better alternatives. Regardless of your exact need, you can do better than the First PREMIER Bank Credit Card. If you want a credit card to rebuild your credit, rather than emergency borrowing, there are better options, like no annual fee secured cards.