The best credit cards for people with bad credit are secured cards. These cards require a cash security deposit, which will usually be equal to your credit line. Using a secured card regularly and responsibly can help you build credit and qualify for a regular unsecured card. When you close a secured card, or convert it to an unsecured card, the issuer refunds your security deposit. Learn more about secured cards.
 
Our pick for

Low deposit

Capital One® Secured MasterCard®

Apply Now

on Capital One's secure website

Annual fee
$0
Ongoing APR
25.24%
APR, Variable
Recommended credit score
350
629
Poor
We like it for
No annual fee Flexible deposit requirement Chance of higher credit line

Benefits

Most secured cards typically require you to make a deposit equal to your credit line, and you have to come up with the whole deposit upfront. With the Capital One® Secured MasterCard®, however, you can get a credit limit of $200 for a deposit of $49, $99 or $200, depending on the state of your credit. You can also make your deposit in installments. If you make your first five payments on time, you may be eligible for a higher credit line without depositing additional money.

Drawbacks

Bottom line


Our pick for

No credit check

OpenSky® Secured Visa® Credit Card

Apply Now

on Capital Bank's secure website

Annual fee
$35
Ongoing APR
17.64%
APR, Variable
Recommended credit score
350
689
Poor - Average
We like it for
Easier approval No credit check Unbanked consumers

Benefits

Unlike 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.

Drawbacks

Bottom line


Our pick for

Rewards and upgrading

Discover it® Secured Card – No Annual Fee

Apply Now

on Discover's secure website

Annual fee
$0
Ongoing APR
23.49%
APR, Variable
Recommended credit score
350
689
Poor - Average
We like it for
No annual fee Cash-back rewards Clear upgrade process

Benefits

The Discover it® Secured Card – No Annual Fee 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 seven months, and Discover will review your account for a possible upgrade to an unsecured card.

Drawbacks


Our pick for

Low interest and fees

Digital Federal Credit Union Visa Platinum Secured Credit Card

Apply Now

on Digital Federal Credit Union's secure website

Annual fee
$0
Ongoing APR
11.75%
APR, Variable
Recommended credit score
350
850
Poor - Excellent
We like it for
Lower ongoing APR No annual fee No cash advance fee No balance transsfer fee High credit limit

Benefits

The ongoing APR is 11.75% 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.

Drawbacks

Bottom line


Methodology

NerdWallet’s credit cards team selects the best cards in each category based on overall consumer value. Factors in our evaluation include fees, promotional and ongoing APRs, and sign-up bonuses; for rewards cards, we consider earning and redemption rates, redemption options and redemption difficulty. A single card is eligible to be chosen in multiple categories.

Last updated Jan. 27, 2017.

Paul Soucy is an editor at NerdWallet, a personal finance website. Email: paul@nerdwallet.com. Twitter: @paulsoucy.