Getting a new credit card if you have bad credit may feel impossible, but there are more options than you think. In fact, getting a new credit card may even improve your credit score if you use it right.
Too many people use credit cards as an extension of their income. if instead, you used it as a way to protect your purchases, build credit, and earn rewards, you could make the most of your opportunity to have a credit card.
Before you take the first credit card for bad credit offered to you, it’s important to understand the features, costs, and potential rewards they offer. Most credit cards for bad credit don’t have a lot of features, but we’ll highlight a few below.
The Top Secured Credit Cards for Bad Credit
A secured credit card is often a safe bet when you have bad credit. Your credit line is equal to the deposit you make. If you don’t make your payment, the credit card company keeps your security deposit – it’s that simple.
Discover it Secured Credit Card
The Discover it Secured credit card is the equivalent of Discover’s popular ‘standard’ credit card, but with a twist. You must make a security deposit equal to your credit line.
APR: 10.99% on balance transfers for 6 months and 22.99% on everything else
Annual fee: $0
Features:
- You must make at least a $200 security deposit
- Even poor credit scores are approved
- Earn 2% in rewards on charges at gas stations and restaurants ($1,000 max per quarter)
- Earn 1% back on everything else
- Free access to your credit score
- Automatic upgrade to an unsecured card after 7 months if you qualify
Capital One Platinum Secured Credit Card
The Capital One Platinum Secured credit card is another card you make a deposit on and is easy to get because of the security deposit.
APR: 26.99%
Annual fee: $0
Features:
- Security deposit minimums range from $49 – $200, some people qualify for a higher credit line than their deposit
- Account evaluation after 6 months for a credit line increase
- Free access to CreditWise to monitor your credit
- Allows poor credit scores
- If you pay your bill on time, you may earn your security deposit back as a statement credit
Capital One Quicksilver Secured Rewards Credit Card
The Capital One Quicksilver Secured Rewards credit card is another unique secured credit card for bad credit that pays rewards. Like the two cards above, you must make a security deposit, but it may not be for the full credit line depending on your qualifying factors.
APR: 26.99%
Annual fee: $0
Features:
- Earn 1.5% cash back on any purchase with no limit
- If you make your payments on time, you can get your security deposit back as a statement credit
- Free access to CreditWise to monitory your credit
- Possibility of an increased credit line after 6 months with automatic review
- Allows poor credit scores
The Top Unsecured Credit Cards for Bad Credit
Unsecured credit cards don’t require a security deposit, but they have other downsides like annual fees and higher APRs to make up for the risk.
Mission Lane Visa Credit Card
While the Mission Lane Visa credit card doesn’t offer any rewards, the fact that it’s somewhat low cost and helps you rebuild your credit is enough for many consumers. The APR and annual fee you receive depend on your qualifying factors.
APR: 26.99% – 29.99%
Annual fee: $0 -$59
Features:
- Free access to your credit score
- Automatically see if you’re eligible for a higher credit limit after 6 months
- Credit limits starting at $300
- Instant answer on your application
- Works with bad to fair credit scores
Credit One Bank Platinum Visa
The Credit One Bank Platinum Visa offers rewards for consumers that qualify for the credit building card and many people get approved with low or average credit scores.
APR: 23.99%
Annual fee: $75 for the first year, then $99 per year
Features:
- Earn 1% cash back on groceries, utilities, and gas purchases
- Free access to your Experian credit score
- Flexible due dates (you get to choose)
- Reports to all three credit bureaus
- Automatic opportunities for an increased credit line
Petal 1 ‘No Annual Fee’ Credit Card
Annual fees can make it difficult to have a credit card especially if they don’t pay rewards, because what’s the point of the credit card, right? The Petal 1 Visa offers both no annual fee and it pays rewards, giving you the best of both worlds.
APR: 19.99% – 29.49%
Annual fee: $0
Features:
- Credit limits as high as $5,000
- Earn between 2% – 10% cashback on your purchases
- Reports to all three credit bureaus
- Automatic credit line increase opportunities after 6 months
AvantCard
The AvantCard is another unsecured credit card for people with bad credit. It doesn’t offer any rewards, but there’s only a small annual fee, which can make it a great card to get back into building your credit.
APR: 24.99%
Annual fee: $59
Features:
- Reports to all three credit bureaus to help you build good credit
- Low annual fee
- $0 fraud liability
- Automatically checks for credit line increase opportunities
Final Thoughts
If you get a credit card for bad credit and use it right, you could increase your credit score. Using a credit score right means paying your bill before the due date, paying the balance off in full, and/or not keeping a balance higher than 30% of your credit line.
If you don’t use credit cards as an extension of your income and instead use them as a personal finance tool, they can be a great way to build your credit, earn rewards, and make the most of your opportunities to save.