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Best Low Interest Credit Card for Fair Credit

Dec. 29, 2014
Credit Cards for Average or Fair Credit, Credit Score
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Credit card offers for fair credit usually aren’t stellar, and this especially holds true if you’re looking for a low interest card. These days, average credit just isn’t enough to get most folks the primo plastic offers.

But why is this, and are there any low interest, fair credit credit cards to consider? Take a look at the details below – the Nerds will explain everything you need to know.

Why are credit card interest rates high if you have fair credit?

The interest rate you’ll be charged on your credit card (or any loan) is highly dependent on your credit score. The lower your score, the risker a borrower you’re considered to be. If your credit is only fair, the lender’s thinking goes something like this: Since it’s sticking its neck out to lend to you, the return on that gamble should be high. This, of course, comes in the form of high finance charges.

Also at play is competition in the marketplace. Because of the risk issue, banks prefer customers with a solid credit history and often use 0% promotional offers to woo them away from competitors. Sadly, lenders aren’t usually interested in enticing folks with sub-par credit to use their products en masse. As a result, there’s not much incentive to provide juicy low-interest offers to this this class of borrower.

But it’s important to remember that paying interest on a credit card is entirely voluntary. Even if you get a card with a high APR, simply paying your bill in full every month will make it a moot point.

One low(ish) interest credit card for fair credit to consider

It’s important to remember that when recommending a low interest credit card for fair credit, we’re speaking in relative terms. Frankly, there aren’t any cards out there that carry a truly low APR, but there is one that charges less than others of its kind.

We’re talking about the UNITY Visa® Secured Credit Card. With this card, you’ll get 9.95% on balance transfers for 6 months, and then the ongoing APR of 17.99% (Fixed). Again, this is still a pretty high interest rate, but compared with the other options on the market, it’s not too bad. Also, this card’s annual fee is lower than many other fair credit credit cards at $39.

Since this is a secured credit card, you’ll need to put down an up-front deposit to establish your credit line. This can be $250-$10,000, depending on how much you’re willing to provide. As long as you show good payment habits, you’ll be refunded this money when you’re ready to move on to another card.

Finally, it’s important to note that your account activity with the UNITY Visa® Secured Credit Card will be reported to all three credit bureaus. Assuming you pay on time and in full every month, this will help you pump up your credit score.

Tips for improving your credit score

Since a middling credit score is standing between you and the low interest credit card of your dreams, it’s time to start working to improve it. Here are the Nerds’ top tips for doing so:

  • Pay all your bills on time – no exceptions.
  • Keep the balance on your credit cards below 30% of their credit limits at all times throughout the month.
  • Use your card consistently.
  • Don’t apply for any new credit cards.
  • Check your three credit reports once per year at If you spot an error, take steps to have it corrected.

The bottom line: If you have fair credit, your options for low interest credit cards are limited. While you can opt for the UNITY Visa® Secured Credit Card, you should also focus on using our tips above to take your score from average to good. Then, on to great!

Image via iStock.