Like other secured credit cards for people building or rebuilding credit, the Discover it® Secured Credit Card requires a cash security deposit. Unlike most others, it offers rewards. But what really makes it stand out from the competition is its upgrade possibilities. The issuer has a process in place for automatically reviewing accounts for possible transition to an unsecured card. Read our review. Show
Capital One Quicksilver Secured Cash Rewards Credit CardOur pick for: Rewards and upgrading The Capital One Quicksilver Secured Cash Rewards Credit Card offers an impressive combination of features for those with poor credit. A deposit is required, but in exchange you get a $0-annual-fee card that reports to all three credit bureaus; an automatic credit limit review after six months; and a possible upgrade path to an unsecured Capital One card. Oh, and 5% back on hotels and rental cars booked through Capital One Travel, plus 1.5% back on all other purchases, which equals what you'd find on many unsecured cards. Read our review. Capital One Platinum Secured Credit CardOur pick for: Low deposit The Capital One Platinum Secured Credit Card requires a security deposit, as do all secured credit cards. But while most cards require you to put down a deposit equal to your credit line, this one allows some qualifying applicants to get a $200 credit line with a deposit starting at $49. Further, you can be automatically considered for a higher credit line with no additional deposit in as little as six months. Read our review. Citi® Secured Mastercard®Our pick for: Basic card for thin credit The Citi® Secured Mastercard® is a straightforward card for people new to credit — put down a security deposit, use the card to establish a positive credit history and then move up to a better card (and get your deposit back). One note: This card is for people just starting out with credit, rather than people with bad credit from past mistakes. Read our review. OpenSky® Secured Visa® Credit CardOur pick for: No credit check or no bank account The OpenSky® Secured Visa® Credit Card charges an annual fee, but a lot of people will still want to take a look at it for two reasons. First, there's no credit check required. Second, you don't need a traditional bank account; you can fund the deposit or pay your bill with a money order or Western Union payment. Read our review. Chime Credit Builder Visa® Credit CardOur pick for: Easy account management This card has no minimum deposit requirement, charges neither an annual fee nor interest, and doesn't require a credit check, and you can automate your payments so you're never late. But to get it, you must be a Chime banking customer, which is an extra hoop to jump through — and which comes with its own considerations when it comes to customer service. Read our review. Petal® 1 "No Annual Fee" Visa® Credit CardOur pick for: No-deposit alternative The issuer of the Petal® 1 "No Annual Fee" Visa® Credit Card doesn’t only rely on credit scores to determine eligibility. Instead, it assesses your creditworthiness based on your income, expenses, savings and debts. The card earns a decent rate of up to 10% cash back when you use the card to shop with select merchants. And there's no annual fee, late fees or foreign transaction fees. Read our review. Credit Builder Secured Visa® Credit CardOur pick for: Adjustable credit limit The Credit Builder Secured Visa® Credit Card from Armed Forces Bank makes it easy to increase your credit line over time to give you greater flexibility and keep your credit utilization low. You can increase your limit in $50 increments simply by depositing more money at any time. Read our review. Navy Federal Credit Union® nRewards® Secured Credit CardThe no-annual-fee Navy Federal Credit Union® nRewards® Secured Credit Card earns rewards, offers an upgrade path and even features some perks, which is a lot from a secured product — if you can swing the membership and security deposit requirements. Read our review. DCU Visa® Platinum Secured Credit CardOur pick for: Low fees and interest The DCU Visa® Platinum Secured Credit Card is a secured card for bad credit, but it offers a lower interest rate than many unsecured cards for people with good credit. You must be a member of Digital Federal Credit Union to get this card, although you can join by becoming a member of a partner organization for as little as $10. Read our review. Getting a secured credit cardEven though secured credit cards are available to people with bad credit, and even though the security deposit reduces the risk to the issuer, approval is not guaranteed for everyone:
How does the process work?Every issuer handles things a bit differently, but the process of applying for, receiving and using a secured credit card works like this:
Alternatives to secured credit cardsUnsecured cards for bad creditSeveral issuers specialize in unsecured credit cards for people with bad credit, but NerdWallet generally doesn't recommend them. That's because these "subprime specialist" cards tend to charge high fees that can easily add up to much more than a typical minimum security deposit — annual fees up to $99, application fees, "activation" and "processing" fees, monthly maintenance fees and so on. And unlike the deposit on a secured card, those fees are money you can't get back. Our roundup of the best and worst cards for bad credit has more information on cards to avoid. Prepaid debit cards offer convenience and are a safer alternative than carrying cash, but they don't help you build credit. With a prepaid debit card, you "load" money onto the card, and the purchases you make are paid for with that money. Since you're not borrowing money, there's no effect on your credit score. See NerdWallet's best prepaid cards. Offered mostly by smaller financial institutions, such as credit unions and community banks, these loans are designed to help you build a good payment history. The money you "borrow" isn't actually given directly to you. Instead, it's held on your behalf in a savings account while you repay the loan in monthly installments. Once you're done, the money is released to you — and your credit report shows a paid-off loan. Learn more about credit-builder loans. These loans can be secured or unsecured. Unsecured loans (those without collateral, such as a car title) generally have higher interest rates than secured loans. The better your credit, the lower your rate is likely to be. Conversely, those with bad credit can expect to pay very high rates, if they can get a loan at all. Learn more about personal loans. What credit cards does not require a deposit?Capital One Platinum Credit Card. See Details » ... . Capital One QuicksilverOne Cash Rewards Credit Card. ... . Surge® Platinum Mastercard® ... . Indigo® Unsecured Mastercard® – Prior Bankruptcy is Okay. ... . Reflex® Platinum Mastercard® ... . Milestone® Mastercard® – Less Than Perfect Credit Considered. ... . Total Visa® Card. ... . FIT® Platinum Mastercard®. What type of credit card is usually given to someone with bad credit?Secured and unsecured credit cards
There are two types of credit card options for bad credit, secured and unsecured. A secured credit card requires a deposit of a certain amount of money into a savings account, and the credit limit is often based on a percentage of the deposited amount.
Can you get approved with a 500 credit score?Yes, you can get an unsecured credit card with a 500 credit score, but you will likely end up with high fees, high interest rates, and a low credit limit.
What is the easiest card to get approved?Easiest Credit Cards to Get Approved for in 2023. OpenSky® Secured Visa® Credit Card.. Petal® 2 Visa® Credit Card.. The First Progress Platinum Elite Mastercard® Secured Credit Card.. Bank of America® Customized Cash Rewards Credit Card for Students.. Credit One Bank® Platinum Visa® for Rebuilding Credit.. |