List of Best Credit Cards for Bad Credit in USA

Last Updated on July 1, 2024 by admin

You may have negative aspects in your credit history when your credit is  bad indicating that it will difficult in getting a great APR. On the Other hand, you can get loan ranging from
$500 to $10,000

Our discussion is focus on credit cards for bad credit history since bad credit has made it difficult for you to get a regular credit card, consider applying for a secured credit card.

According to FICO score a Bad credit is often reflected as a low credit score, typically under 580 on a scale of 300 to 850. A person is considered to have bad credit if they have a history of not paying their bills on time or owe too much money.

With bad credit you will find it difficult to borrow money, especially at competitive interest rates, because they are considered riskier than other borrowers

Also read: What is good Credit score:How to get it and Factors that Affect Credit Scores

Below are few credit card options that are best suited for poor or bad credit in the United states.

List of credit card options that are best suited for poor or bad credit in the United states.

There are several credit card options available for those with poor or bad credit in the United States. These cards typically offer lower credit limits and higher interest rates than those for good credit, but they can be valuable tools for rebuilding credit history. Here are some of the best options:

1. Discover it® Secured:

Discover it® Secured Credit Card help build or rebuild your credit history with the three major credit bureaus. Generally, prepaid and debit cards can’t do that.

There is No annual fees, earn 1% unlimited cash back on every purchase.At gas stations and restaurants on up to $1,000 in purchases each quarter.Also you can easily view your FICO® Credit Score on monthly statements, mobile and online for free.

2. Secured Mastercard® from Capital One:

This a great tool to help you build good credit.It has No annual fees, no cash back, miles, or points with Purchase Rate of 26.99% variable APR.

It has a Required Security Deposit of $49, $99 or $200 refundable minimum security deposit. You are automatically considered for a higher credit line in as little as 6 months. Capital One refunds security deposits in two ways: You can earn back your deposit as a statement credit by using your card responsibly. Or it will be refunded when you close your account and pay your balance in full.

Read: How to apply for Wells Fargo mortgage loan application

3. Total Visa® Unsecured Credit Card:

The Total Visa card should only be an option for people with the worst credit scores who refuse to open a secured card—everyone else will find much better terms elsewhere.

The Total Visa® Unsecured Credit Card doesn’t require a security deposit but charges high fees and interest. You need a checking account for this carD and Monthly payments are manageable. With this you can overcome your bad credit.

4. Citi® Secured Mastercard®:

Citi® Secured Mastercard® is an option for customers with little or no credit history and can help you build your credit with monthly reporting to all 3 major credit bureaus.

It required a security deposit for this product (minimum $200) with a Purchase APR 22.49% variable APR*—–Once available, you will also have free access to your FICO® Score online. Tracking your score is a great first step to managing your credit history and taking control of your financial future.

5. Credit Builder Secured Visa® Credit Card:

The credit card is from Armed Forces Bank and it doesn’t offer cash back, miles, or points..The Annual Fee is $25 monthly payment, 24 month term with a $9 admin fee with Regular APR of 15.92% variable.

However, unlike all of those cards, your credit limit with the Credit Builder Secured Visa® Credit Card is adjustable. You can increase your credit limit by adding funds (in increments of $50 or more) to the savings account that you set up for the card, up to $3,000.

Read: What is different between Secured loans vs Unsecured loans

6. DCU Visa® Platinum Secured Credit Card

The secured card is for bad credit, but it offers a lower interest rate than many unsecured cards for people with good credit. You must be a member of Digital Federal Credit Union to get this card, although you can join by becoming a member of a partner organization for as little as $10.

7. Harley-Davidson® Visa® Secured Card

Harley-Davidson® Visa Credit Card is from U.S. Bank. it help Build or repair credit.there is No annual fee

8. Surge Mastercard Credit Card:

A Surge Mastercard® with an initial credit limit that ranges from $300 to $1,000. Use your Surge card at locations everywhere Mastercard is accepted. A checking account is required. All credit types whether bad or poor are welcome to apply. Initial credit limit of $500.00 (subject to available credit), the application process is fast and easy with results in seconds

You can also read: Cash App: How to fund it, Sign Up, Order for card & Activate Card and use Cash app Card

Others are:

9. Credit One Bank® Unsecured Visa® with Cash Back Rewards:

10. Credit One Bank® Visa® Credit Card:

11.AeroMexico Visa Secured Card:
12.Savings Secured Visa Platinum Card:
13.capital One® Secured Mastercard®
14.Discover it® Student Cash Back
15. First PREMIER® Bank Mastercard® Credit Card:
16. OpenSky® Secured Visa® Credit Card
17. First Progress Platinum Elite Mastercard® Secured Credit Card

How to Choose the Best Credit Card for Bad Credit

Choosing the best credit card for bad credit requires careful consideration of several factors to ensure you find a card that helps you rebuild your credit while minimizing fees and interest. Here’s a guide to help you navigate the process:

1. Understand Your Credit Score: Before applying for any credit card, check your credit score to understand where you stand. This will help you narrow down your options and focus on cards designed for your credit level. You can get your free credit score from various online platforms like Credit Karma or directly from credit bureaus.

2. Consider Secured Credit Cards: Secured credit cards are a great starting point for rebuilding credit. They require a security deposit, which typically becomes your credit limit. As you use the card responsibly and make timely payments, you can gradually improve your credit score and potentially qualify for unsecured cards with better terms in the future.

3. Look for Cards with No or Low Annual Fees: Many credit cards for bad credit come with annual fees. However, some offer no annual fee options, which can help you save money while you rebuild your credit.

4. Compare Interest Rates (APRs): Interest rates on credit cards for bad credit tend to be higher. Compare the APRs of different cards and choose one with the lowest possible rate to minimize interest charges.

5. Check for Rewards and Benefits: While not all cards for bad credit offer rewards, some do. Look for cards that offer cash back or other perks to make the most of your spending.

6. Read the Fine Print: Carefully review the card’s terms and conditions, including fees, interest rates, credit limit increases, and any potential penalties for late payments.

7. Research and Compare: Explore various credit card options from different issuers. Read reviews and compare features to find a card that aligns with your needs and budget.

8. Pre-Qualify for Cards: Many credit card issuers offer pre-qualification tools that allow you to see if you’re likely to be approved without impacting your credit score. This can save you time and unnecessary hard inquiries on your credit report.

9. Apply for the Card: Once you’ve chosen a card, apply online or in person at a branch. Be prepared to provide documentation such as proof of income and identification.

What Are the Pros and Cons of Cards for Bad Credit?

Credit cards designed for individuals with bad credit can be a helpful tool for rebuilding credit history and improving financial standing. However, they also come with potential drawbacks that should be carefully considered. Here’s a breakdown of the pros and cons:

Pros:

• Credit Building Opportunity: The primary advantage of these cards is the opportunity to establish or rebuild a positive credit history. By making on-time payments and managing your credit responsibly, you can demonstrate creditworthiness to lenders.
• Easier Approval: These cards typically have more lenient approval requirements than traditional credit cards, making them accessible to those with lower credit scores or limited credit history.
• Access to Credit: These cards provide access to credit, which can be helpful for emergencies or necessary purchases.
• Potential Rewards: Some credit cards for bad credit offer rewards programs, allowing you to earn cash back or other benefits while rebuilding your credit.

Cons:

• High-Interest Rates (APRs): These cards often come with significantly higher APRs than regular credit cards, meaning you’ll pay more in interest charges if you carry a balance.
• Low Credit Limits: The initial credit limit on these cards is usually low, limiting your spending power and potentially impacting your credit utilization ratio.
• Annual Fees: Some cards may charge annual fees, adding to the overall cost of using the card.
• Limited Perks and Benefits: These cards may not offer the same perks and benefits as premium credit cards, such as travel rewards or purchase protection.
• Risk of Debt Accumulation: If not used responsibly, the high-interest rates and fees can lead to a cycle of debt that can be difficult to escape.

Tips for Using Credit Cards for Bad Credit:

• Make on-time payments: This is the most crucial factor in improving your credit score. Set up automatic payments or reminders to ensure you never miss a due date.
• Keep your balance low: Aim to keep your credit utilization ratio (the amount of credit you use compared to your total credit limit) below 30%.
• Pay more than the minimum payment: Pay as much as you can afford each month to reduce your balance faster and minimize interest charges.
• Avoid cash advances: Cash advances often come with higher fees and interest rates.
• Monitor your credit report: Regularly check your credit report for errors and track your progress in rebuilding your credit.

How to Apply for a Credit Card With Bad Credit

Applying for a credit card with bad credit can be a challenging process, but it’s not impossible. There are several strategies and specific types of credit cards that you can consider:

1. Check Your Credit Report:

Before applying for any credit card, obtain a free copy of your credit report from each of the three major credit bureaus (Equifax, Experian, and TransUnion). Review the reports for any errors and dispute them if necessary. Knowing your credit score will help you determine which cards you are most likely to be approved for.

2. Consider Secured Credit Cards:

Secured credit cards require a security deposit, which typically becomes your credit limit. They are designed for individuals with bad credit or limited credit history and can help you rebuild your credit score.

3. Research Credit Cards for Bad Credit:

Several credit card issuers specialize in offering cards to individuals with less-than-perfect credit. Research and compare different cards to find one that suits your needs and has reasonable fees and interest rates.

4. Look for Credit Builder Cards:

Credit builder cards are designed specifically to help you build credit. They may have lower credit limits and fewer rewards, but they report your payment activity to the credit bureaus, helping you establish a positive credit history.

5. Apply for Store Credit Cards:

Store credit cards are often easier to get approved for than major credit cards. While they might have higher interest rates and limited acceptance, they can be a good starting point for building credit if used responsibly.

6. Become an Authorized User:

If a family member or friend has a good credit history, ask if they would add you as an authorized user on their credit card. This can help you build credit as their positive payment activity is reflected on your credit report.

7. Prepare Your Application:

When applying, be prepared to provide information about your income, employment, and housing situation. Be honest and accurate in your application to increase your chances of approval.

How to Improve Your Credit Score