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Some of the best cards for people with bad or poor credit are unsecured and secured cards with low annual fees. Often, these cards can serve as stepping stones, giving you access to credit now and—with responsible use—helping you improve your credit scores. You may be able to upgrade or move onto better cards later. Getting a credit card with bad credit and managing it properly by making on time payments may be a good approach to building credit.
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The AvantCard is an unsecured credit card for people who are new to credit or rebuilding their credit. The card isn't available to residents of Colorado, Hawaii, Iowa, Nevada, Vermont, West Virginia or Wisconsin. But it could be a good option if you can qualify.
One of the biggest benefits of the AvantCard is that you can use it to build credit without having to pay a security deposit. You also won't have to pay foreign transaction fees when using the card, which can save you money if you're outside the country or ordering items from other countries online. There is a $59 annual fee.Read full review
- No deposit required
- Reports to all three major credit bureaus
- No hidden fees
- We may periodically review your account for credit line increases
- Fast and easy application process
- Help strengthen your credit history with responsible use
- Zero fraud liability for unauthorized charges
- Conveniently pay your card through our online portal, 24/7
- Avant branded credit products are issued by WebBank, member FDIC
- Disclosure: If you are charged interest, the charge will be no less than $1.00. Cash Advance Fee: 3%, Min: $10.
The OpenSky® Secured Visa® Credit Card
The OpenSky® Secured Visa® Credit Card is a secured card with a minimum $200 refundable security deposit (which becomes your credit line) and $35 annual fee. The card doesn't offer any rewards and it won't be a good fit for everyone. There's no credit check required, however, which means it could be a good option if you're having trouble getting approved for other cards. And it reports payments to all three credit bureaus (Experian, TransUnion and Equifax), helping you build credit on all three credit reports.
The OpenSky® Secured Visa® Credit Card is also one of the few secured cards available to people who don't have or want a bank account. Instead of making an electronic transfer, you can choose to send the deposit with a Western Union wire transfer, or mail a check or money order.Read full review
The OpenSky® Secured Visa® Credit Card
- No credit check to apply and find out instantly if you are approved
- OpenSky gives everyone an opportunity to improve their credit with an 85% average approval rate for the past 5 years
- Get considered for a credit line increase after 6 months, with no additional deposit required
- You could be eligible for the OpenSky Gold Unsecured Card after as few as 6 months
- Reports to all 3 major credit bureaus monthly, unlike a prepaid or debit card
- Nearly half of OpenSky cardholders who make on-time payments improve their FICO score 30+ points in the first 3 months
- Your refundable*** deposit, as low as $200, becomes your OpenSky Visa credit limit
- Easy application, apply in less than 5 minutes right from your mobile device
- Offer flexible payment due dates which allow you to choose any available due date that fits your payment schedule
- ***View the cardholder agreement
Capital One Platinum Secured Credit Card
As a secured card, the Capital One Platinum Secured Credit Card stands out because you may qualify to put down a refundable security deposit starting at $49 to get a $200 initial credit line (you can also deposit more than the minimum to get a higher credit line). There's also no annual fee or foreign transaction fee, which could make this an inexpensive option for building credit.
Capital One will also automatically consider raising your credit limit after you've made your first six payments on time. And, you may qualify to have your security deposit refunded as a statement credit if you use your card responsibly.
Capital One Platinum Secured Credit Card
- No annual or hidden fees. See if you're approved in seconds
- Building your credit? Using the Capital One Platinum Secured card responsibly could help
- Put down a refundable security deposit starting at $49 to get a $200 initial credit line
- You could earn back your security deposit as a statement credit when you use your card responsibly, like making payments on time
- Be automatically considered for a higher credit line in as little as 6 months with no additional deposit needed
- Enjoy peace of mind with $0 Fraud Liability so that you won't be responsible for unauthorized charges
- Monitor your credit with CreditWise from Capital One. It's free for everyone and checking your credit does not hurt your credit score
How to Decide Which Card Is Right for You
Picking the right card depends on which cards you'll likely be able to get and why you want to get a credit card.
If you primarily want a credit card to improve your credit, the exact card doesn't matter as much as how you use it. Credit scores don't distinguish between secured and unsecured credit cards, and cards' rewards programs, fees and interest rates don't impact credit scores.
Make sure that the card issuer reports your account to all three major credit bureaus—most major issuers do—and then only make a small purchase each month before paying the bill in full. Also, make at least your minimum payment on time to avoid late payments, which can lead to fees and hurt your credit.
Credit building aside, if you want a card for everyday use and will likely be able to pay the bill in full, a card with a rewards program could be a good fit. But if you want a card for emergency expenses that will likely take some time to pay down, a low interest rate or promotional offer may be more important than rewards.
What Is the Difference Between a Secured and Unsecured Card?
In terms of how you use the card, secured and unsecured cards are identical in many ways. The main difference is that you need to provide the card issuer a security deposit to get a secured card; unsecured cards don't require a security deposit.
There's generally a minimum deposit requirement for secured cards, such as $200, and your card's credit limit will often be based on your security deposit. You may be able to provide a larger deposit if you want a higher limit. Just keep in mind that you might not get the security deposit back until you close the account or the card issuer upgrades you to an unsecured card (not all cards have this option).
Secured cards are sometimes a good option for people who have bad credit. Whichever type of card you choose, make sure it reports payments to the credit bureaus to help you build credit. And with either type of card, avoid using a large portion of your card's credit limit if possible and always pay your bill on time. Paying your bill in full each month will also help you avoid paying interest.
How to Improve Your Credit Before Applying for a Credit Card
There are different steps you can take to improve your credit before applying for a new credit card. Depending on why you have bad or poor credit in the first place, it could take some time to move into a new credit score range (such as fair or good). However, here are some actions that can help:
- Pay down current credit card debt.
- Get a new credit card, only use a small portion of its credit limit and make at least the minimum payment on time.
- Open a credit-builder loan and make on-time monthly payments.
- Rehabilitate defaulted federal student loans.
- Use Experian Boost™† to add on-time phone, utility and streaming service payments to your Experian credit report.
You may also want to review your credit reports for erroneous negative marks. Disputing errors could get the negative marks corrected or deleted, which could help your credit scores.
What to Do if You're Denied for a Credit Card
If your credit card application is denied, the card issuer will send you an adverse action letter explaining why. You have the right to get a free copy of your credit report to get a better understanding of why you were denied.
You may also want to call the issuer and ask why your application was denied. In some cases, the decision can be reversed. But often, you may need to improve your creditworthiness before trying again later—or try to get a different credit card if you want one now.
A few card issuers might let you apply with a cosigner, which could help your chances. Or, if you initially tried for an unsecured card, you could apply for a secured card instead. You can also try to get prequalified for a credit card, which will tell you if you're likely to get approved or denied without impacting your credit scores.
Get Matched With Credit Cards
Finding your next credit card could be difficult, particularly when a low credit score limits your options. We've highlighted some of the top picks above for people with bad or poor credit. You can also use Experian CreditMatchTM credit card marketplace to get matched with our partners' cards and offers, filter options based on your preferences and create a side-by-side comparison of your top picks.