Having bad credit can make it difficult to get approved for loans, apartments, and even some jobs. However, a credit card designed for people with bad credit can help you rebuild your financial standing. Whether you opt for a secured or unsecured credit card, the right choice can help you improve your credit score over time. This guide explores the best credit cards for bad credit and how to use them responsibly.
What Are Credit Cards for Bad Credit?
Credit cards for bad credit are specifically designed for individuals with low credit scores (typically below 600). These cards often have higher interest rates and lower credit limits but provide an opportunity to rebuild credit through responsible use.
Types of Credit Cards for Bad Credit
Secured Credit Cards – Require a security deposit, which acts as collateral. Ideal for those looking to safely rebuild credit.
Unsecured Credit Cards – Do not require a deposit but often come with higher fees and interest rates.
Store Credit Cards – Easier to qualify for but have limited usability.
Credit-Builder Cards – Specifically designed to help users establish or rebuild credit.
Top Credit Cards for Bad Credit
1. Discover it® Secured Credit Card
No annual fee
Cash-back rewards on purchases
Reports to all three major credit bureaus
Requires a refundable security deposit
2. Capital One Platinum Secured Credit Card
Low refundable security deposit
Credit limit increase opportunities
No annual fee
3. OpenSky® Secured Visa® Credit Card
No credit check required
Reports to all three credit bureaus
Requires a security deposit
4. Credit One Bank® Unsecured Visa® for Rebuilding Credit
No securitydeposit required
Cash-back rewards
Monthly credit score tracking
Higher interest rates and fees
5. Petal 2 "Cash Back, No Fees" Visa Card
No annual fee
No security deposit
Higher credit limits for qualifying applicants
Requires at least fair credit
How to Choose the Right Credit Card for Bad Credit
Check Fees & Interest Rates – Look for cards with low or no annual fees and reasonable APRs.
Ensure It Reports to Credit Bureaus – Choose a card that reports to all three major credit bureaus (Experian, Equifax, TransUnion) to boost your score.
Consider a Secured Card – If you struggle to get approved for an unsecured card, a secured credit card is a great alternative.
Look for Credit Limit Increases – Some cards offer automatic credit line increases after consistent on-time payments.
Read the Fine Print – Watch out for hidden fees, such as maintenance charges or high late payment penalties.
Tips for Using Credit Cards to Improve Your Credit
Make On-Time Payments – Payment history accounts for 35% of your credit score. Always pay at least the minimum due before the due date.
Keep Your Credit Utilization Low – Try to use no more than 30% of your credit limit at any time.
Avoid Applying for Multiple Cards at Once – Each application results in a hard inquiry, which can temporarily lower your score.
Monitor Your Credit Score – Regularly check your credit report to track progress and correct errors.
Upgrade to a Better Card – After improving your score, transition to a credit card with lower fees and better benefits.
Getting a credit card for bad credit is a crucial step toward financial recovery. By choosing the right card and using it responsibly, you can steadily improve your credit score and unlock better financial opportunities. Whether you opt for a secured or unsecured option, the key is to make timely payments and maintain good financial habits.