Our pick for
Rewards and upgrading
22.99% Variable APR
10.99% on Balance Transfers for 6 months
Recommended Credit Score
ProsThe Discover it® Secured may be the best credit card available for people with bad credit. Not only does it have an annual fee of $0, but it also gives rewards: 2% cash back on up to $1,000 worth of spending per quarter on restaurants and gas, and 1% on all other spending. Handle your account responsibly for eight months, and Discover will review your account for a possible upgrade to an unsecured card.
ConsThe initial deposit must be paid with a bank account, so if you don’t have access to traditional financial services, you may be out of luck.
- 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 with your tax return 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.
- Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. Plus, earn unlimited 1% cash back on all other purchases – automatically.
- Get 100% U.S. based customer service & get your free Credit Scorecard with your FICO® Credit Score
- INTRO OFFER: We automatically match all the cash back you've earned at the end of your first year.
- Get an alert if we find your Social Security number on any of thousands of Dark Web sites.* Activate for free.
- View Rates and Fees
Our pick for
No credit check
18.89% Variable APR
Recommended Credit Score
ProsUnlike most other secured cards, the OpenSky® Secured Visa® Credit Card doesn’t require a credit check, so even people with badly damaged credit may be able to qualify. (You’ll still need to meet income standards, however.) Also setting this card apart from other secured cards: You don’t need a bank account. You can make your deposit and pay your bill by debit card, wire transfer, check or money order.
ConsThe card charges an annual fee. There’s no process to upgrade to an unsecured card.
- 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.
Our pick for
Low interest and fees
Recommended Credit Score
ProsThe ongoing APR is 13.75%, Variable. That’s roughly half the rate of many popular secured cards — and better than what you can get on many unsecured cards. The annual fee is $0, and there are no balance transfer or cash advance fees. As with most secured cards, you have to make a security deposit equal to your credit limit, but this one doesn’t put a cap on how much you can deposit, and therefore how high your limit can be.
ConsYou must be a member of Digital Federal Credit Union. There are a number of ways to become a member, and most people can do so, but it’s still a hoop to jump through.
- Secured card rates well below the national average
- Borrow against your DCU savings account
- No Annual Fee*
- No Fees or Higher Rates for Cash Advances and Balance Transfers
- Works with Apple Pay®, Google Pay™, and Samsung Pay
- Insurance, car rental, travel, and warranty benefits
- Optional Overdraft Protection On Your DCU Checking
- Buy online easily and safely with Visa Checkout
- Embedded EMV chip to protect your card information
Our pick for
Lowest interest rate
Recommended Credit Score
ProsCredit cards for people with bad credit tend to have very high interest rates — often 25% or more. The Green Dot primor® Visa® Gold Secured Credit Card, however, offers a rate lower than what you'll find on many products for people with good or excellent credit: The ongoing APR is 9.99%. There's also no penalty rate if you pay late. The card allows for credit lines as large as $5,000, assuming you have the cash to deposit.
ConsThere's an annual fee of $49, which is on the high side for secured cards. (For a lower fee but a higher APR, consider the Green Dot primor® Visa® Classic Secured Credit Card. The annual fee is $39. The ongoing APR is 13.99%.)
- Credit lines available from $200 to $5,000! Super Low Fixed 9.99% interest rate on purchases - with no penalty rate!
- No minimum credit score requirements! We invite all credit types to apply! No processing or application fees!
- Helps strengthen your credit with responsible card use. Reports to three national bureaus
- Fast, easy application process. Choose your credit line and open your Personal Savings Deposit Account to secure your line.
- See additional Green Dot primor® Visa® Gold Secured Credit Card details
Our pick for
Adjustable credit limit
23.24% Variable APR
Recommended Credit Score
ProsThe Credit Builder Secured Visa® Credit Card from Armed Forces Bank allows you to increase your credit limit simply by adding money to your deposit in $50 increments. (The minimum deposit is $300.) Most secured cards either don't allow you to add to your deposit or make you apply for a credit limit increase. Your deposit also earns interest.
ConsThe card has an annual fee of $35.
- Set your own credit limit between $300 and $3,000 based on the amount you deposit into your Credit Builder Savings account.
- Custom Credit Line - Increase your credit limit by adding funds in increments of $50 or more to the savings account.
- Accrued Interest on Savings - The money in your savings account will earn interest, adding to your savings.
- Automatic Reporting - We'll report your performance to the three major credit bureaus to help you build a credit history.
- Upgrades Available - You can upgrade to an unsecured card with good performance. We'll periodically review your credit activity to see if you qualify. If you do, we'll let you know.
- Custom Payment Date - If you are a new customer, you can choose either the 1st or 16th of each month as your payment date. Once your date is set, it can't be changed.
Our pick for
Bikers ... or anyone seeking a $0 fee
Recommended Credit Score
ProsThe Harley-Davidson® Visa® Secured Card has an annual fee of $0 and allows for credit limits of up to $5,000. There's also a rewards program: You earn 1 H-D Genuine Rewards point per dollar spent. Every time you accumulate 2,500 points, you get a $25 H-D gift card redeemable at Harley dealerships or the Harley-Davidson online store.
ConsIf you aren't a Harley-Davidson rider, you won't get much value out of the rewards, although you could always use them for gifts for the Harley lover in your life.
- Earn one H-D™ Genuine Rewards point for every $1 in net purchases
- Redeem 2,500 points for a $25 H-D™ Gift Card
- Every purchase on your card earns you an entry for a chance to win a motorcycle in our H-D™ Visa Free Ride Sweepstakes
- No Annual Fee
- Zero Fraud Liability
- Fraud Protection
- Auto Rental Collision Damage Waiver
- Online Banking
- Automatic Bill Pay
- View Rates and Fees
How to tell if you need a credit card for bad credit
When you apply for a regular credit card, you're essentially asking the card issuer to lend you money without any guarantee (besides your promise) that you'll pay it back. Unlike with a mortgage or car loan, there's no collateral backing up the deal. If an applicant doesn't have a good credit score, the issuer considers the risk to be too big, and that's why it rejects the application.
Credit cards for bad credit, however, have features that reduce the risk to card issuers, so they can approve more people. The application process for credit cards for bad credit is more "forgiving" than for regular credit cards. Credit cards for bad credit might be a good fit for you if:
YOUR CREDIT SCORE IS BELOW 630
In general, a credit score below 630 (on a range of 300-850) is considered bad credit or poor credit. If you don't know your credit score, you can get it for free through NerdWallet. Get your free credit score here. If you have a bad score, a credit card specifically designed for people in your situation is one of the best tools for rebuilding your credit.
|Score range||Credit type|
YOU HAVE NO (OR VERY LITTLE) CREDIT HISTORY
The term "bad credit" is commonly associated with mistakes, such as missing payments or having accounts turned over to collection agencies. But people who have a thin credit history or none at all can also benefit from a credit card for bad credit, since they, too, are considered risky borrowers.
What causes bad credit?
Multiple factors go into credit scores. Some are relatively minor — applying for a new credit card, for example, can knock a few points off anyone’s score temporarily because it suggests a need for more financial resources. Others are more serious. Bankruptcy, charge-offs or missed payments can do major damage to credit scores.
Here are the main factors in your credit score and how they can add up to bad credit:
- Payment history. This is the single biggest factor in your score. Are you paying your bills on time? Paying a bill a couple of days late might not affect your credit score at all (although you might get hit with a late fee). But once a bill is more than 30 days late, expect it to show up on your credit report and affect your score. Even a single late payment can make a major dent in your score. That damage lessens with time, but if you're repeatedly missing payments, it gets much worse.
- Amounts you owe. Your overall debt load matters, but scoring systems pay special attention to credit utilization — the amount of your credit limit you're using. The closer someone is to "maxing out" a line of credit, the more likely it is that they're in a bad financial position. A $190 balance on a card with a $2,000 limit isn't going to raise a lot of red flags, but a $190 balance against a $200 credit line suggests someone pushing the limits of their means.
- Length of credit history. If you haven't had credit very long, that can be reflected in low scores. A common mistake people make is closing old accounts that they're not using, which affects this portion of their score. A 10-year-old credit card account is valuable from a scoring perspective, even if the card is just sitting in a drawer. If it doesn't have an annual fee, keep it open and use it once a year so the issuer doesn't shut it for inactivity.
- Types of credit. Scoring formulas like to see a mix of different types accounts — credit cards, loans and so on. Obviously, you have to start somewhere, but it's best not to let a single account be your entire credit history.
- New credit applications. Expect every application to knock a few points off your score temporarily. However, if you're applying for multiple cards at once, the effect is multiplied, because that can suggest someone desperate for money. This is why it's important to "call your shots" and apply only for cards when you have a good chance of approval.
What's the easiest credit card to get approved for?
Approval for any credit card is never guaranteed. In addition to your credit history, issuers look at your income and other factors. Still, some cards have standards that are not as difficult to meet as others'.
- The lower the risk to the credit card issuer, the easier it is to get approved. That's why secured credit cards are a recommended starting point for people working to build or mend credit. These cards require you to put down a cash security deposit, which the issuer holds as collateral in case you don't pay your bill (and which you get back when you close or upgrade your account). The deposit reduces the risk, so issuers can make these cards available to more people. The cards on this page are all secured cards.
- Store credit cards are also generally easier to qualify for than bank cards. They tend to have low credit limits and high interest rates, but they're a viable credit-building tool provided you keep your balances low relative to the limit and pay them off each month.
- In general, NerdWallet does not recommend unsecured cards for bad credit. An unsecured card is one that does not require a security deposit. All "regular" credit cards are unsecured. But unsecured cards marketed to people with bad credit are notorious for high fees and confusing terms. Further, issuers of such cards usually don't have good cards to upgrade to, meaning you're stuck with either keeping a high-fee card open (which costs you money) or closing it (which could hurt your credit score). Most of the options in our "Credit Cards to Avoid" section below are unsecured.
- If you've begun to build credit and have a score in the mid-600s, look at credit cards for fair credit. These provide more benefits but don't require a top-tier credit score. See our best credit cards for fair credit.
The costs of bad credit
Credit scores are designed to measure one thing: How much of a risk it is to lend someone money. The lower the perceived risk, the higher the score. Having bad credit limits your options for borrowing money: If you can get a loan at all, you’ll pay higher interest.
There are other costs, too. Even though they’re not designed as such, credit scores have come to be interpreted as a general measure of reliability. Employers, landlords, insurers, cell-phone providers, utility companies and others use them to evaluate customers or applicants.
A NerdWallet survey found that many people are unaware of these effects. Significant numbers of Americans didn’t know that bad credit could prevent them from renting an apartment (23%), raise their car insurance costs (43%), limit their options for cell-phone service (49%) or force them to provide security deposits for utility service (52%). Further, 1 in 5 respondents thought a score of 600 — which is bad credit — was enough to qualify for any credit card.
If you have bad credit, or no credit, a card designed specifically for someone like you is usually the quickest and easiest way to build credit.
Choosing a credit card for bad credit
Credit cards for bad credit typically come with low credit limits and high interest rates. That’s OK for now, because the primary purpose of these cards is to help you build credit or rebuild credit. When choosing a card, focus on:
- Reporting to credit bureaus. A card will help you build credit only if it reports your payments to the companies that assemble the credit reports that are the basis of credit scores. Look for a card that reports to all three major credit bureaus. Note that prepaid cards do not report to the credit bureaus because they do not involve borrowing money.
- Low fees. Unsecured credit cards for bad credit often boast that you can apply for them with no deposit. But then they hit you with annual fees, maintenance charges and other credit card fees that can easily top $100 a year. Good secured credit cards have either no annual fee or a fairly small one, and no hidden charges. You do pay a deposit — but you can get that money back.
- Free credit score. Look for an issuer that provides free access to your score so you can track your progress. Ideally, the issuer would also offer other resources such as debt-payment calculators and free financial education programs.
- A path to upgrade. Once your credit improves, it’s nice to be able to convert your account to a card with better terms. If you have a secured card, will the issuer transition you to a regular unsecured card? If you have an unsecured card for bad credit, can you move up to a version with no fees or one that offers rewards?
Read more in our guide to choosing a credit card for bad credit.
How to apply for a credit card for bad credit
1. Know your credit score
One of the biggest mistakes people make with credit card applications is choosing cards they don't qualify for. Applying for a card that requires good credit when you have a score of 580 is a guaranteed rejection. That wouldn't be so bad except that each application goes on your credit report and can hurt your score. Multiple applications can just compound the damage. Before you apply, know where you stand. You can get your free credit score through NerdWallet.
2. Find a card that suits your score
Cards on this and other NerdWallet pages have a "recommended credit score" graph that shows what kind of credit you'll need to qualify. If you're logged in to NerdWallet with your free score, you'll be able to see where your score lands on that graph. If you're not logged in but know your score, check how it compares to the recommended range.
Clicking the "apply now" button for a card takes you to the application. You'll usually have to provide your name, address, phone number and email address. Your Social Security number is necessary to check your credit and for government financial reporting rules. The application will usually ask about your income as well.
4. Fund your security deposit
With a secured credit card, the issuer won't open your account until you're provided your security deposit. Most cards have a minimum in the range of $200 to $300. Your deposit typically determines your credit limit, so if you deposit $500, you'll have a credit limit of $500; deposit $1,000, and you'll get a credit line equal to that amount. Issuers let you fund the deposit with a direct transfer from a checking account; some allow you to pay by money order if you don't have a bank account.
5. Receive your card
Once you fund your deposit, you'll get your card. Start using it to build a positive credit history by following the guidelines below.
How to raise your credit score using a credit card
A low credit score isn’t a life sentence. It’s a starting point. Using a credit card responsibly is one of the fastest ways to build credit. Follow these tips:
- Use the card. Building a good credit history starts with making on-time payments. So use your credit card regularly and pay your bill before your due date.
- Don’t overuse the card. A key element in your credit score is your credit utilization, or how much of your available credit you’re using. A maxed-out card is a sign of someone in financial trouble. So keep utilization below 30% at all times. On a card with a $300 credit limit, for example, that means you should keep your balance under $90.
- Pay on time and in full. With any credit card, the best move is to pay your entire balance in full every month. That way, you’ll never pay interest — and the interest rates on credit cards for bad credit are typically very high. If you can’t pay in full, pay at least the minimum amount due by your due date.
- Track your progress. Check your credit score and credit report regularly to see whether you’re moving in the right direction or if other things are holding you back. You can get free access to your credit score and credit report on NerdWallet
- Keep accounts open, if possible. The age of your open credit accounts is a factor in your credit score. So don’t close accounts unless there’s a compelling reason, such as an annual fee on a card you don’t plan to use. When it comes time to upgrade from a secured card to an unsecured one, see if your issuer will let you keep your same account.
CREDIT CARDS TO AVOID
Many credit cards that are marketed to people with bad credit are expensive. These cards might not require a security deposit, but they impose an array of steep fees just for the privilege of carrying and using them. These can include application fees, processing fees, activation fees and monthly “maintenance” or “membership” fees, in addition to annual fees.
Add up those fees, and they can easily cost you more over the first couple of years than the deposit on a good secured credit card — and, unlike a security deposit, the fees you pay are money you’ll never get back. These cards can even cost more to carry than some of the best rewards credit cards on the market. Their ongoing interest rates tend to be high as well.
NerdWallet recommends you steer clear of products like these:
FIRST PREMIER BANK CREDIT CARD
The fees on the First Premier Bank Credit Card are truly eye-popping. For starters, there’s a "program fee" that applies before you even get your card. Then there are ongoing fees that depend on your credit limit. For example:
|Fees in first year||Fees second year and beyond|
|Credit limit||Program fee||Annual||Maintenance*||Annual||Maintenance*|
|*Maintenance fees are billed monthly: $6.25 per month = $75 per year; $10.40 per month = $124.80 per year|
This convoluted fee structure owes its existence to a provision of federal law. Under the Credit Card Act of 2009, the fees on a credit card in the first year the account is open can’t exceed 25% of the credit limit. Processing fees are charged before you open the account, so they don’t count against the 25% cap. After the first year, there are no limits, so that’s when monthly maintenance fees kick in. As a result, you’ll pay between $120 and nearly $175 a year in fees for this card. On top of it all, the APR on this card was 36% as of June 2019 — one of the highest interest rates on any card.
HORIZON GOLD CARD
The banner across the top of this card’s website reads: “Bad Credit, No Credit? Low Score? NO PROBLEM.” In reality, though, there are multiple problems. The Horizon Gold card advertises an unsecured $500 credit limit, but you might have to read the website carefully to recognize that it’s simply a store card that you can use at just one place: the Horizon Outlet online mall. The “membership” fees required to use this card come out to nearly $300 a year, and there’s even a one-time $5 “issuance and account validation fee” just to get the card. This card’s issuer, Horizon Card Services, offers several other cards, all of which can be used only at the Horizon Outlet. They include the NetFirst Platinum card, the Freedom Gold, the Merit Platinum and the Group One Platinum.
CREDIT ONE CREDIT CARDS
Credit One Bank — not to be confused with Capital One — specializes in credit cards for those with less-than-great credit. Its offerings include the Cash Rewards Visa Card and the Platinum Visa for Rebuilding Credit, as well as the Official NASCAR Visa. The Credit One website is maddeningly vague about what kind of card you’ll end up with if you apply. For example, your annual fee could be anywhere from $0 to $75 in the first year and $0 to $99 after that. You may or not get a grace period. You might get rewards on all purchases, or only some, or none. There are also complicated, confusing rules on when your payments will post and when your available credit line is refreshed after making a payment. Our recommendation: Don’t bother trying to figure it out, and don’t bother applying.
As of June 2019, these cards were charging a $125 annual fee in the first year for a minimum credit line of $500 — 25% of the credit limit, the legal maximum. In the second year, the annual fee drops to $96 — but you start paying $10 a month in maintenance fees, for total fees of $216 a year. The APR, meanwhile, was a whopping 29.99% as of June 2019. The Surge Card and Matrix Card are offered by Continental Finance. That company has several other cards with similarly jaunty names and the same janky terms: the Cerulean Card, the Reflex Card, the Fit Card and the Verve Card.
Like the First Premier Bank Credit Card, the Total Visa starts laying on fees before you even open your account. If you apply and are approved, you must first pay an $89 processing fee to get your card. The annual fee in the first year is $75. In the second year and beyond, the annual fee drops to $48 — but you start paying a monthly processing fee of $6.25, which comes out to $75 a year. Put them together, and the Total Visa card will cost you $164 in the first year and $123 every year thereafter. To top it off, this card’s APR as of June 2019 was an eye-popping 34.99%. Not acceptable.
LAST RESORT OPTIONS
INDIGO PLATINUM MASTERCARD
According to the website for this card, the annual fee depends on a cardholder’s creditworthiness. It might be $0, it might be $59, or it might be $75 the first year and $99 every year thereafter. Which one will you pay? You have to apply to find out for sure. It’s safe to say, though, that people with bad credit are more likely to end up with a $75/$99 fee than a $0 fee. Even $59 is significantly more than you would pay in annual fees on a good secured card. The APR on the Indigo Platinum as of June 2019 was 24.90%. That’s high but within the typical range for a credit card for bad credit. You can do worse than this card — but you can also do much better.
MILESTONE GOLD MASTERCARD
The Milestone Gold is offered by Genesis Bankcard Services, the same company that’s behind the Indigo Platinum. It, too, has fees that depend on creditworthiness: $35 a year, $59 a year, or $75 in the first year and $99 in subsequent years. Adding a layer of confusion, the first year’s fee might be divided between an “account opening fee,” which you pay before the account goes live, and an “annual fee,” which you pay afterward. This may be a way to avoid running afoul of the 25% rule. The APR is the same as on the Indigo Platinum, and our general assessment is the same: not the worst card, but far from the best.
Last updated on March 26, 2020
NerdWallet's Credit Cards team selects the best credit cards for bad credit based on overall value, as evidenced by star ratings, as well as suitability for specific kinds of consumers. Factors in our evaluation include annual and other fees, deposit requirements for secured cards (both the minimum and maximum allowed), interest rates, whether a card offers an option to upgrade to an unsecured account, the availability of free credit scores and other credit education and tools, reporting to credit bureaus, and other noteworthy features such as a rewards program or the ability to qualify without a credit check.
Frequently asked questions
Bad credit is generally defined as a credit score below 630 on a scale of 300 to 850. Credit scores measure how safe or risky it is to lend to someone. The higher the risk, the lower the score. If you’ve made mistakes with credit — missing multiple payments, maxing out accounts, having bills turned over to collection agencies, your score can drop into the bad-credit range. Also, if you’re new to credit, you might not have a credit score at all, which in many ways is functionally equivalent to bad credit — you’re considered a higher risk because you haven’t yet demonstrated your ability to handle borrowed money.
Multiple credit card issuers have cards specifically designed for people with bad credit. (They’re often advertised as ideal for “rebuilding” credit.) These are generally “starter cards” — they don’t offer rewards or perks, they charge high interest rates, and some of them come with steep fees. NerdWallet generally recommends secured credit cards to people with bad credit. Secured cards require you to put down a cash deposit that the card issuer holds as collateral in case you don’t pay your bill. You get that money back when you close your account in good standing or upgrade to a regular card.
A secured card isn't your only option for bad credit — but it's usually your best option. Some card issuers offer regular “unsecured” cards for people with bad credit. These don’t require a cash deposit, but they tend to come loaded with high fees. That’s money you can’t get back, unlike the deposit on a secured card.
When looking for a credit card for bad credit, be realistic. You’re not going to find one with rich rewards or lavish perks. You’ll most likely have a high interest rate (although if you pay your bill in full every month, you won’t be charged interest). And your credit limit will likely be small; secured cards usually give you a credit line equal to your deposit. Beyond that, look at:
- Fees. Look for annual fees of less than $50, and avoid cards that charge maintenance fees, application fees or processing fees. Several good secured cards don’t charge an annual fee at all.
- Reporting to credit bureaus. Presumably, you want to use your card to build credit so you can qualify for better cards or loans down the road. But using your card can improve your credit only if your payments are reported to the credit bureaus, the companies that compile the credit reports that form the basis of credit scores. Look for a card that says it reports to all three major credit bureaus (Equifax, Experian and TransUnion).
- Upgrade options. Ideally, after you’ve improved your credit, you could upgrade your account to a better card. That allows you to keep the account open — which is good for your credit score — while getting your deposit back. Many issuers of cards for bad credit have outstanding upgrade options. Others focus only on people with lower scores and might not have much to offer. The lack of an upgrade option shouldn't be a dealbreaker, but a clear upgrade path is a point in favor of some cards.
You generally need to be at least 18 years old and have a Social Security number to be considered for a credit card. You’ll need to show that you have income, and in most cases (but not all), you must have a bank account. While “bad credit” by itself is obviously not a disqualifier when it comes to cards for bad credit, some issuers might still deny your application if your credit report shows serious problems such as a bankruptcy, a civil judgment or liens against you. Read more about qualifying for a card for bad credit.