So do you have bad credit and need a credit card? You’re probably going through a tough time since most credit cards require you to have at least fair credit to qualify for them. But don’t worry, there are credit card companies that do take bad credit, and you’ll find a list of their best deals below. Let’s get this straight up front: You won’t find any of the best cards with lucrative rewards on this list. However, you will find some decent card options that can help improve credit and thus move you to better cards. Eventually, with smart and responsible use, you could even qualify for the best store  credit cards. That is why we suggest that you do not skip our resources and advice,

What is bad credit?

Bad credit is generally defined as having a FICO credit score below 580 (on a scale between 300 and 850). A lower credit score indicates irresponsible credit behavior in the past, such as not paying bills on time, loan defaults, bankruptcy, late payments, overstretched lines of credit, etc. applying for credit There are three major credit bureaus (TransUnion, Equifax, and Experian), and credit scores may differ between the three. That will depend on whether your creditor (or lender) reports to one, two, or all of them. Keep in mind that creditors can also use their scoring models, and they will be different as well. if approved a loan o a card credit, people with bad credit are likely to get subprime rates. Subprime rates are higher than average interest rates and are offered to high-risk borrowers.

How to improve your credit using a credit card?

A credit card can be a useful tool on your credit repair journey only if used responsibly. Here are some tips on how to make that happen:

• Make Payments On Time – This one probably goes without saying, but it doesn’t hurt to be reminded. Be sure to pay at least the minimum amount before the due date. Keep in mind, though, that if you don’t pay the balance in full, it will accrue interest (think of the high APRs that come with credit cards!).

• Consider your credit utilization ratio – Credit utilization ratio is a significant factor with a big impact on your credit score. It is calculated by dividing the amount of money you owe by your available credit limit. Generally, it is recommended to keep it below 30%. That means if you have a $1,000 line of credit, you should never have a balance of more than $300.
• Monitor your credit score – Many of the best credit cards for bad credit listed above (such as the Capital One Platinum Secured Mastercard®) offer you access to your credit score. That allows you to always stay on top of your credit and see how certain spending habits affect you.
• Avoid closing credit card accounts – Closing your accounts could hurt your credit score. For example, it could increase your credit utilization ratio, which you don’t want to happen if you’re trying to improve bad credit. If you want to close it due to an annual fee or to get your security deposit back, if possible, consider switching to a version of the card with no annual fee or upgrading to an unsecured one. With the Discover it® Secured Credit Card, you can qualify for an unsecured card in as little as eight months.

Who should get a credit card for bad credit?

In addition to people with bad credit, of course, credit cards for bad credit can also be useful for people with little or no credit history. These two are put in the same basket because people without an established credit history also pose a risk to creditors and lenders. They have yet to prove that they are reliable borrowers.

For example, if you are student, it’s probably not easy for you to get a credit card (if you haven’t had a regular job or are paying off a student loan). Since cards designed for applicants with bad credit make it easier to qualify, they are a good starting option.

How to choose a credit card for bad credit?

Choosing a credit card for bad credit requires careful consideration. You want to make sure it’s the right card that will help you repair your credit. Another important thing to keep in mind when applying is to assess your chances of getting approved for a particular card. A denial never looks good on a credit report and will further lower your credit score. If you’re not sure about your chances of approval, try applying for a card that offers prequalification first. 

The most important thing to consider in a card for create creditIt is if you report to the three major credit bureaus . If your good credit behavior goes unnoticed, it won’t do your credit score much good. Keep in mind that all of the best credit cards for bad credit here report to the three major credit bureaus. It might help if the credit card also gives you access to your credit score so you can keep track. Another important thing is the rates . Credit cards for credit problems often have all kinds of fees: annual fee, late payment fee, returned payment fee, foreign transaction fee, etc. Keep them in mind while using the card.

You also need to be honest with yourself about carrying a balance. If you tend to do that, get a card with a low APR . First Progress Platinum Prestige Mastercard® Secured has the lowest APR (14.99% Variable), but comes with a $49 annual fee. As we already explained, the credit limit has a high impact on the credit utilization ratio; consider the line of credit that best suits you and your financial needs. Petal® 1 “No Annual Fee” Visa® offers a potentially high credit limit of up to $5,000.

Last but not least, the choice betweena secured credit card oan unsecured credit card. Both can be used to rebuild credit, so for a better understanding, check out the section where we explain the differences between the two.

What to do if your application is denied?

A denied credit card application is not the end of the world. You’ll get an explanation of the denial, and once you know the reason, the next step is to figure out how to fix it. Let’s look at some common reasons for rejection and your options for them:

• High Balances – Make a plan for how to pay off your high credit card debt.
• Too Many Inquiries – Too many requests on your credit report within a short period of time can get you denied, regardless of whether you were approved. Wait until some of them disappear from your credit report, then reapply.
• Low Income – Required income varies among different credit card issuers. Next time you should take a chance with a lower ranking card.
• Recent Delinquencies – Some recent delinquencies, such as a late payment, can negatively affect your chances of getting approved. What you can do is wait and try again.
• Poor Credit History – If the credit card company can’t determine your creditworthiness, you probably won’t be approved for a credit card. In order for a FICO Score to be generated, you must have at least one account that has been active in the last six months. Or consider cards you can apply for with little or no credit, like the Petal® 1 “No Annual Fee” Visa®.
• Not Old Enough : The legal age for a credit card is 18 years old. However, there are some exceptions, such as if you have your own income or have already been added as an authorized user to a parent’s credit card.

Secured Credit Cards vs. unsecured for bad credit

Secured credit cards require a security deposit (which generally serves as your credit limit) to be refunded later. You can be refunded when you close your account, upgrade to an unsecured card, or if you qualify for a refund. Since these cards are secured with a refundable security deposit, they usually do not have (or are lower) annual fees .

If you can afford a security deposit, it’s always better to get a secured card since you can get the deposit back, but the annual fee is a cost you won’t get back. However, if you can’t pay the security deposit, you can still opt for an unsecured credit card with no money down. Although, in that case, be prepared to pay a hefty annual fee. The Surge® Platinum Mastercard® is an unsecured card that will cost you an annual fee of $125 the first year and $96 thereafter.

The costs of bad credit

Bad credit can hurt you financially in a number of ways. People with bad credit generally have to deal with the following:

• High APRs on loans and credit cards , probably the most obvious. It will be difficult to even get approved in the first place, but if you do, you will most likely end up with high interest rates.
• Limited access to finance – if you need an emergency loan, you may have to go for an expensive alternative, such as payday loans.
• Larger Minimum Payments – Several of these will eat up a significant portion of your budget.
• Expensive Insurance Premiums – It may come as a surprise, but insurance companies do credit checks too! So be prepared to pay more for car insurance, for example.
• Getting a home – A bad credit score will make it more difficult to buy a house (affects your mortgage rate) or even rent an apartment (landlords also tend to dislike bad credit scores).
• Utility Deposit – If you do not meet the requirements of a utility company, you may be required to provide a refundable deposit to use the service.