Best Credit Cards for Poor Credit Score: Apply for Unsecured & No Fee
Now, more than ever, when the average American family owes more than $8,000, having credit serves as a reflection of your daily habits, financial goals, and overall financial responsibility. To no surprise, many people in the United States have poor credit. However, poor credit can be due to many reasons, some of which may be accidental. Although accidental, these financial choices will follow you for years to come and will show up as a reflection on your credit score.
This is nothing to panic or be upset about because there are numerous pricing options for people with poor credit, depending on your needs and goals such as, renting a home, taking out a loan, purchasing a car, medical emergencies, etc. However, the chances for success when taking out a loan or purchasing a car on poor credit may be somewhat difficult due to credit history. This is nothing to worry about!
As is best in any scenario, it is always advised to become aware of the possible circumstances of poor credit and the best available options for a person with poor credit. Therefore, let us say you have an emergency and need to take out a credit card under your name, but you are hesitant to do so because of your credit score. In this article, we will be discussing credit cards in correlation to poor credit and how you can jumpstart your credit score to ensure a positive credit future.
What is Considered Poor Credit Score
Before we can dive into what is considered “poor credit”, it is important to understand how poor credit is determined, how it can impact your future, and what it tells a potential lender about your characteristics as a person.
How Is Poor Credit Determined?
Your credit score is used by potential lenders to determine whether you are a good candidate to extend a credit line to or whether or not they should trust you with their service, such is the case with cellphone carriers or a rental communities. Now, simply because a person has poor credit does not mean they will be declined. Although it can be somewhat more difficult to be approved, in most cases having poor credit means the lender can ask for extra fees or a deposit.
Now, poor credit is different than bad credit. Poor credit is anything between 500 to 579. Whereas, bad credit is anything from 300-499. The good news is it’s better to have poor credit than bad credit. Poor credit is a glimpse into the potentiality that you, as an individual, are working on your credit score. With this, poor credit is determined on numerous factors which give the lender an overall outlook into the credit holders personality.
Poor credit is determined by:
- Credit length – This is the length of how long you’ve had credit. A new person beginning to increase their credit may have a low credit score simply because they have only had it for 6 months. The great thing is shortly after having credit for a year, your credit score will continue to raise steadily, if all credit cards and loan payments are paid on-time.
- Credit Availability – This factor is approximately 30 percent of your FICO score. This is determined based off your available credit to how much you spend. If you owe more than is available under your name, your credit will surely suffer. It is best to always have at least 50% of your credit available, it will appear much more positive to the bureaus. We like to refer to this as the Credit Utilization Sweet Spot.
- Credit Diversity, New Accounts, Applications – These factors are important when tallying up your credit score. For example, the amount of credit accounts you have applied for compared to how many times you have been declined can impact your credit score. In fact, if you apply for a credit card, without a guarantee that you will get it, can affect your credit score from 1 to 2 points. With that said, having a new account can also affect your credit score as well as your credit diversity. It is always best to have numerous credit lines for the bureaus to notice you can manage more than one. However, this is only best if you know you are financially stable to do so.
- Paying on Time – If there is one aspect of having credit that can hurt your credit more than anything it is being late on a payment or having a service turned off. Ensuring payments on time shows the credit bureaus that you, as an individual, are responsible enough to keep track of your minimum payments and when they are due. Always pay your credit cards on time!
How Poor Credit Can Impact Your Future?
Of course, poor credit will impact your future differently than good or great credit. These are the many ways in which poor credit will impact your future:
- With poor credit, loan applications and credit applications may not be approved. More exclusive services and credit cards may decline your application for a new credit line.
- With a poor credit history, landlords may not approve rental applications. If they do approve your application, you may have to pay a larger security deposit.
- A poor credit line means more security deposits when applying for numerous services. These services include electricity, phone, cable, and other utility services.
- You cannot get a cellphone contract if you have poor credit. Cell phone companies check your credit. Their reasoning is that since they are extending a month of service, they need to know if you will be reliable enough to pay for the service.
- With a poor credit line, you may be denied for certain job positions. Work opportunities in management or finances sometimes do a credit check to see if you have outstanding bills, bankruptcy, or high amounts of debt.
- Debt collectors calling you is a negative side effect of poor credit, only if you have outstanding debt payments.
- Insurance companies also do a credit check to determine your insurance premium.
- Starting your own business with poor credit can be somewhat difficult when trying to take our bank loans and receive financial backing from other businesses.
- Of course, when trying to purchase a car on bad credit, it will be somewhat difficult unless you purchase it through a specific vendor that overlooks a low credit score. If accepted, you may have to pay much more of a deposit and high interest rates.
What Poor Credit Says About Your Personality Trait?
There are numerous factors that determine poor credit. When a lender checks your credit score there are numerous factors that tell the lender a wealth about your financial responsibilities, your past, and even a glimpse into the future.
However, if you have a poor credit score due to having one credit line and it being opened less than a year, they will see that is well. This circumstance, although you would be considered a “new” credit holder, looks much better than having numerous outstanding debt payments. Nonetheless, your credit history gives the potential credit lender an insightful look into your characteristics as an adult. These characteristics include:
- Financial responsibility.
- Financial goals.
- Financial history.
You Can Get Back on Track
No matter how low your credit score is, you can always get back on track as long as you pay your payments on time, do not have outstanding debt, and always pay more than what you owe. With that said, unless you have filed for bankruptcy or have a lot of debt, you can increase your credit score steadily simply through the benefit of credit cards for poor credit.
Advantages and Disadvantages of Credit Cards for Poor Credit
We always advise to take the appropriate measures, establish smart financial habits, and developing a stable budget before opening a credit card, especially if previous credit cards were difficult to keep up with. With the information that we have covered thus far, you might still be wondering whether credit cards for poor credit is the smartest choice for your right now. In light of this, we would like to share some of the advantages and disadvantages that come for those who open credit cards for poor credit.
- If it is a secured credit card, you can steadily and easily raise your credit score through an extended period.
- With secured credit cards, there sometimes is no annual fees and you can decide how much or how little you put onto the card.
- Many credit card companies allow you to view your credit score at least once a month to keep track of your progress.
- With full and steady monthly payments, you can qualify for an increase.
- Some credit card companies have more relaxed guidelines.
- Some credit cards for people with poor credit even give you cash back for groceries, gas, internet services, etc.. Take a look at the best credit card for gas rewards.
- Many credit card companies for people with poor credit offer a pre-qualification option that will not impact your credit.
- Low account opening fee.
- Some credit card companies for people with poor credit have an initial credit limit to ensure you keep your credit usage low.
- Your interest rate on poor credit cards may be much higher than other credit cards, especially the moment you miss a payment or do not pay in full.
- Late fees are typically higher with credit cards for poor credit.
- If you have a specific credit card for poor credit, a low spending limit may be a downfall especially if you planned to make a major purchase with it.
- Credit cards for poor credit are stricter, due to the risk factors involved with issuing a credit card to a poor credit holder.
- You may only be able to use the credit card at specific places or venues.
- If your credit card happens to be a secured credit card, you may have to spend more money out of pocket on the security deposit.
- There may be application fees, processing fees, and annual fees higher than a regular credit card.
What to Look Out for in Credit Cards for Poor Credit
Of course, not everything is always a pleasant as it seems in the bold print. When considering getting a credit card for poor credit, it is essential to read the fine print. Hidden in the fine print there are many things to look out for:
- The highest interest rate on the card, if you do not pay monthly in full.
- The monthly payment on the card.
- Monthly fees and annual fees on the card.
- Fees to take our cash from your credit line.
- Potential places you cannot use your card.
- Introductory interest rates and potential charges.
- Loyalty points or rewards, if any.
- How having this credit card affects your credit.
- Potential incentives for having the card.
- Potential fees for canceling the card.
Although acknowledging your current credit score state, for many people, is fearful and nerve-wracking, having low credit is nothing to be ashamed about. Most importantly, if you do have low credit it is essential and beneficial to begin creating a history that showcases your credit as increasing and not decreasing. When asking for a credit line, credit loan, or applying for a car or an apartment, having a credit line that is in good standing and showcases positive process is important.
With this said, sometimes emergencies happen, and a credit line is important to have. When applying for a credit card for poor credit history, there are many important facets and aspects to look out. Most importantly, secured credit cards allow for consumers to have a more secure way of spending their money and lenders to begin building a relationship with the credit holder. So go ahead and apply for secured credit card offers and soon enough, you will be able to extend your credit line.
As a result of you beginning to better your credit, you will soon be able to enjoy the many benefits that come from an improved credit score. Whether it is purchasing a car, applying for a cellphone plan, or taking out other forms of credit, a positive credit score will always help. Do not fear your poor credit score, begin to better it today with a credit card for poor credit score.
General Questions About Credit Cards for Poor Credit
This section covers general information about credit cards for poor credit.
Can I get a credit card with poor credit?
It’s certainly possible to get a credit card with poor credit. You can get a secured credit card. The OpenSky Secured Visa card doesn’t even have a credit check.
What is a credit card APR for poor credit?
The APR is the amount of money you’ll pay for using your credit card and carrying a balance. With poor credit, you’ll have a higher APR than others. So it may be more challenging to find credit cards low interest offers.
How to get a credit card with poor credit?
The best way to get a credit card with poor credit is to get a secured credit card. The Capital One Secured MasterCard is easy to get and you can rebuild your credit while earning back your security deposit. If this is for operating expenses for your company then there are business credit card bad credit options too.
What is the best credit card for poor credit?
For most people, the best credit card for poor credit will be an unsecured credit card. We recommend checking out the Capital One Secured Mastercard and the OpenSky Secured Visa.
How to apply for a credit card with poor credit?
Secured credit cards and credit cards for people with poor credit are easy to apply for, you just need to know where to look! Capital One, OpenSky, and Credit One all offer credit cards for people with poor credit.
How to get a credit card with poor credit history?
You can get a credit card with poor credit history by obtaining a secured credit card. These cards allow anyone to get a credit card and use it to improve their credit score.
What are the best credit cards for poor credit?
Our two favorite credit cards for people with poor credit are the Capital One Secured MasterCard and the OpenSky Secured Visa. OpenSky doesn’t even run a credit check on your application.
What credit card can I get with poor credit?
The Indigo Unsecured MasterCard is a good credit card to get for people with poor credit. Your credit line will be lower, but you won’t need to make a security deposit to get the card.
What is a good credit card for poor credit?
The Credit One Unsecured Visa for Rebuilding Credit is a great option for a credit card with poor credit. You can use the card to rebuild your score and you don’t even need a security deposit.
Who will give me a credit card with poor credit?
Capital One, OpenSky, and Credit One are three of the best options for places that will give you a credit card with poor credit. You can also try Green Dot Bank and the Deserve Classic Card.
What credit card takes average or poor credit?
Capital One offers credit cards for people with average and poor credit. That means you can have a card from a major credit card company and build your credit at the same time. Hold off on applying for credit card 0 apr offers since it will take some time before you can qualify.
What credit cards are guaranteed to approve poor credit scores?
The best way to get guaranteed approval for a credit card is to get a secured credit card. This will give you the flexibility you need while allowing you to build your credit.
Specific Credit Card Companies and Poor Credit
We’ll answer questions about specific credit card companies and poor credit in this section.
Can you get a Walmart credit card with poor credit?
Yes, you can get a Walmart Credit Card with poor credit. Customers with scores as low as 550 can qualify.
Where to get a credit card with poor credit?
Online banks and credit card companies are some of the best places to get for a credit card with poor credit. Try OpenSky and Credit One to see some great options.
Can I get a Discover card with poor credit?
You can get the Discover it Card with poor credit. This is a secured credit card and I designed for people with bad credit.
Can I get a Kohls card with poor credit?
It’s possible to get a Kohls card with poor credit. There are reports of people with a score as low as 570 getting approved.
Can I get a Southwest credit card with poor credit?
It’s possible. You usually need a credit score in the mid 600’s at least to get a Southwest credit card.
Can I get an Alliant credit card with poor credit?
It’s unlikely that you can qualify for an Alliant credit card with poor credit, as most of their customers have credit scores in the mid to high 600’s.
Does American Express have a card for poor credit?
Blue from American Express is that companies credit card offering for people with poor credit. Other American Express cards will be hard to qualify for with poor credit.
Can you get an Argos card with poor credit?
It’s possible to get an Argos card with a poor credit score. Argos will do a pre-qualification check to help you understand your odds of qualifying without hurting your score with a hard check.
Can you get a Chase credit card with poor credit?
Chase doesn’t currently offer any credit cards for people with poor credit. Credit One, OpenSky, and Capital One are your best options.
Does Capital One accept credit card applications with poor credit?
Yes, Capital One has an unsecured credit card for people with poor credit. They also offer a secured MasterCard that you can get with almost any credit score.
How to get Amazon credit card with poor credit?
One of the best ways to get an Amazon Credit Card with a poor credit score is to use a secured credit card to improve your score. That can help you qualify for the card you want.
Is Citibank card hard to get with poor credit?
Yes, Citibank only has one credit card for people with a credit score lower than 640, and that’s their secured credit card option.
Does Bank of America have a credit card for poor credit?
The only credit card that Bank of America has for people with credit scores less than 640 is the BankAmericard Secured Card.
Does Wells Fargo have a credit card for poor credit?
Wells Fargo has a secured credit card that doesn’t require a credit check. It has a $25 annual fee.
Is there a Delta Credit Card for poor credit?
Delta doesn’t currently have any partnership deals with credit card offers for people with poor credit.
How to get a travel credit card with poor credit?
You'll first need to improve your credit to get approved for this category of cards since they usually require good to excellent credit. When your score does improve take a look at the top credit cards for travel and choose the one with features that matches your needs. Getting credit cards for miles if you travel frequently can make a lot of sense.
Different Types of Credit Cards and Poor Credit
This section covers popular questions about different types of credit cards and poor credit
How to get an unsecured credit card with poor credit?
One of the best options for an unsecured credit card with poor credit is the Credit One Unsecured Visa. This credit card is open to people with poor credit and doesn’t require a deposit.
How to get a gas card with poor credit?
The best way to get a gas card with poor credit is to apply for a secured or unsecured card from a bank that specializes in credit cards for poor credit. Credit One, Deserve, Green Dot and Genesis are all great options here.
Can I get a business card with poor credit?
It’s possible to get a business card with poor credit. The best way is to establish a credit score for your business and use that to apply instead of your personal credit score.
Can I get a government credit card with poor credit?
It’s possible to get a government credit card with poor credit. However, you should talk to your boss or relevant authorities to find out the requirements for your specific case.
Where can I get a shopping card for poor credit?
Kohls is a good option for a shopping card for poor credit. You can also get a general credit card like the Indigo Platinum Mastercard or the Indigo Unsecured MasterCard, both of which are for poor credit.
How to get a major credit card with poor credit?
It’s easy to get a major credit card with poor credit if you know where to look. OpenSky, Capital One, Credit One, Green Dot Bank, and others all have major credit cards for people with poor credit.
Can I get an unsecured credit card with poor credit?
Yes, you can get an unsecured credit card with poor credit. The Credit One unsecured Visa is one of the most popular options in this case.
Is it easy to qualify for a secured credit card with poor credit?
In most cases, yes. Many companies that offer secured credit cards without requiring a credit check. The OpenSky Secured Visa is one example.
Other Credit Cards for Poor Credit Questions
We’ll answer questions about credit cards for poor credit that don’t fit into our other categories in this section.
How to consolidate credit card debt with poor credit?
Consolidation loans are some of the best options for consolidating credit card debt with poor credit. These loans are easier to get than credit cards because they’re not revolving accounts.
How to evaluate a credit card with poor credit?
The best way to evaluate a credit card with poor credit is to make sure that you’ll be able to make your payments. Use online tools to run your purchases through a calculator to see what your standard monthly bill will be at a given interest rate.
How to consolidate credit cards with poor credit?
The best way to consolidate credit cards with poor credit is to seek a consolidation loan. These loans are usually easier to get than credit cards and can help you get out of credit card debt.
What credit card will approve me with poor credit?
Credit One Unsecured Visa, the Deserve Classic Card, Primor Secured Visa Gold Card, and OpenSky Secured Visa Cards are all great options for approval with poor credit.
Which credit card gives highest limit with poor credit score?
Credit cards don’t generally advertise the credit limit that you’ll receive with a card. Most credit cards for poor credit scores will have a limit between $200 and $1,000.
Financial Advisor - MoneyBeagle.com
Michelle is part of our expert team of financial advisors with a proven track record in the credit card industry. After graduating with an Economics Degree focusing on Personal Finance, she got involved with several credit and debt counseling startups.