Best Credit Cards for Poor Credit

Jason Steele

Updated April 21, 2022

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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.

Getting approved for a credit card when you have poor credit can be difficult. What exactly is considered poor credit may differ by card issuer, but the credit bureau Experian defines “very poor” credit as a FICO® score of 579 or lower. Many credit cards aren’t available to people with poor credit, and the ones that are often don’t have great terms. However, there are some credit cards that have attractive offerings for applicants with poor credit. And responsibly using a credit card may even improve your credit score over time. To choose the best cards in this category, we looked for issuers that are marketing their cards to people who have poor credit. We then looked for certain features that would help improve your credit score even further, opportunities to increase your credit limit, and reporting to all three credit bureaus. Where offered, we also looked for cards that offer additional features such as cash-back rewards, low fees, and valuable benefits. While most credit cards for poor credit don’t have an annual fee, there are some that do.

How We Chose the Best Credit Cards for Poor Credit

To find the best credit cards for poor credit, we first divided the market into the following six categories:

Credit cards for building credit
Rewards cards without a deposit
Credit cards for automatically increasing your credit limit
Secured cards for smaller deposits
Secured cards with rewards
Secured cards from a major retail bank

Then, we looked at more than a dozen major credit card issuers and credit unions to find the top cards in each of these categories. We included only cards that anyone can apply for, leaving out products offered by credit unions that not everyone can join.And for each category, we looked at the most relevant factors. For example, the best secured cards with rewards should have solid rewards earning and features that a cardholder would want from a secured card. Meanwhile, the best secured cards for smaller deposits should obviously have smaller deposit minimums, but should also provide opportunity to increase your line of credit. While credit card terms may change from time to time, the following rankings reflect information that was accurate in October 2021. Recommended: Credit Card Terminology, Explained

Best Credit Cards for Building Credit

If you have poor credit, then you’re probably looking to improve your credit score. To find the top credit cards for building credit, we looked for features like reporting your balance and payment history to all three major consumer credit bureaus (Experian, Equifax, and TransUnion) and the opportunity to increase your credit limit over time.

If You Want a Credit Card for Building Credit: Self - Credit Builder Account + Secured Visa® Credit Card

If you have poor credit and are looking to build it, the Self Visa credit card is one of the few cards available without a credit check. To be eligible for this card, applicants must open a Credit Builder Account and make three monthly payments on time, have $100 or more in savings progress, and have an account in good standing. Once you’re approved, you choose what portion of your savings ($100 or more) is used to secure your card and set your limit. This card is slightly different from a regular secured card in that there’s no additional money required up front. Instead, your Credit Builder Account savings secures your card and sets your limit. This card has several additional aspects that can help build credit, including the fact that cardholders with accounts in good standing may have opportunities to increase the credit limit over time and that this card reports to all three major credit bureaus. The variable APR is 23.99%, and there’s an annual fee—one time $1 + secured card $25.

Pros:

You don’t need a credit check to apply for this card.
The card reports to all three major credit bureaus.
Accounts in good standing may have opportunities to increase the credit limit over time.

Cons:

You have to open a Credit Builder Account and meet the eligibility criteria.
The variable APR is high, although not out of line for cards in this category.
There is an annual fee—one time $1 + secured card $25.

Best Credit Cards for Rewards and No Deposit

Many credit cards available to applicants with poor credit require a deposit. However, applicants with poor credit don’t necessarily have to forgo a card that offers cash back rewards but doesn't require a deposit, if that’s what they’re interested in. When we were looking at competitive rewards cards for poor credit, it was important to find a card that offers valuable cash-back rewards without a deposit requirement.

If You Want a Credit Card for Rewards and No Deposit: Credit One Bank® Platinum Visa® for Rebuilding Credit

The Credit One Bank Platinum Visa card for Rebuilding Credit offers those with poor credit a chance to earn rewards without having to make a deposit. The card earns 1% cash back rewards on gas, groceries, and monthly mobile phone, internet, cable, and satellite TV services. Credit One will regularly review your account for a possible credit line increase based on responsible credit use. The variable APR for this card is 23.99%. This card has an annual fee of $75 the first year, and then $99 annually (billed at $8.25 per month).

Pros:

The card is available for applicants with bad credit.
No security deposit is required.
There are cash-back rewards.

Cons:

The variable APR is relatively high.
There’s an annual fee for this card.
Cash back is only offered on select purchases.

Best Credit Cards for Automatically Increasing Your Credit Limit

Increasing your credit limit can positively impact your credit score. While most cards available to applicants with poor credit have a low starting credit limit, some will automatically increase your credit limit over time.

If You Want a Credit Card for Automatically Increasing Your Credit Limit: Petal 1

Although issued from a lesser-known bank, the Petal 1 card offers an opportunity to automatically increase your credit limit while also earning cash back. The card is issued from WebBank, Member FDIC, and it participates in the Visa network. With this card, you earn 2% to 10% cash back at select merchants. Cardholders are eligible for a credit limit between $500 and $5,000, depending on their creditworthiness, but they can earn a credit line increase in six months by making qualifying on-time payments and keeping their credit score within a personalized range. And unlike many other cards for applicants with poor credit, this one doesn’t require a security deposit.This card also reports to all three major credit bureaus, which will help build your credit if you use the card responsibly. The variable APR for this card is between 19.99% and 29.49%. This card also doesn’t have foreign transaction fees, activation fees, or annual fees.

Pros:

Make qualifying on-time payments for six months and you can be eligible for a credit line increase.
You can earn up to 10% cash back at select merchants, which is unusual for a card of this type.
This card doesn’t require a security deposit.

Cons:

Unlike the Petal 2, you can still incur late fees with this card.
This card will only earn cash back at select merchants, not on all purchases.
WebBank has only a few products, so it may be difficult to upgrade or downgrade your card in the future.

Best Secured Cards With Smaller Deposits

Many secured cards require a security deposit of at least two hundred dollars. But if you don’t want to have that much money tied up, a secured card with a smaller deposit minimum may be right for you. When we were looking for top secured cards with smaller deposits, the amount of the deposit was obviously the most important factor, but we also wanted a full featured card from a reputable card issuer.

If You Want a Secured Card With a Smaller Deposit: Capital One Platinum Secured

The Capital One Platinum Secured card has a smaller deposit requirement than many other secured cards. There is a $49, $99, or $200 refundable minimum security deposit (depending on your credit history), and access to an authorized bank account is required to make that security deposit. Once you make the minimum required security deposit, you will get an initial credit line of $200. Plus, if you deposit more money before your account opens, you can get a higher credit line. And you can be automatically considered for a higher credit line in as little as six months. This card has a 26.99% variable APR. There are no foreign transaction fees or annual fees with this card.

Pros:

This card has a low security deposit.
It offers automatic consideration for a higher credit line in as little as six months.
There are no foreign transaction fees.

Cons:

The car has a high APR.
It provides few benefits.
The initial credit line is only $200.

Best Secured Cards With Rewards

Applicants used to have to forgo earning rewards with a secured card, but now there are a few secured credit cards that still earn cash-back rewards. When choosing the top secured cards with rewards, we looked for a card that had both solid rewards earning and features that a cardholder would typically want from a secured card.

If You Want a Secured Card With Rewards: Discover it® Secured

The Discover it Secured card is a secured card that offers good rewards for people with poor credit. The card earns 2% cash back at gas stations and restaurants (up to $1,000 in combined purchases each quarter) and an unlimited 1% cash back on all other purchases. During your account’s first year, you can earn even more rewards with the card’s Cashback Match feature, which automatically matches an unlimited dollar-for-dollar of all the cash back you've earned at the end of your first year.The card has a refundable security deposit starting at $200. After eight months, you may automatically qualify to convert to an unsecured card and get your deposit back. There is a 10.99% introductory APR offer for six months for balance transfers that post to your account by December 10, 2021. After that, the standard 22.99% APR applies. There’s no annual fee for this card.

Pros:

The card offers good opportunities for rewards.
The first year is especially valuable due to dollar-for-dollar matching.
It’s eligible to convert to an unsecured card after eight months of responsible use.

Cons:

This card requires a security deposit.
The intro APR offer is not 0%.
Rewards earnings have a cap.

Best Secured Cards From a Major Retail Bank

Some people prefer to have a credit card from a major retail bank. Having a credit card from your bank is easier to manage, since you can connect it directly to your checking or savings account and have a physical location to go to if a problem arises.

If You Want a Secured Card From a Major Retail Bank: BankAmericard® Secured Credit Card

The BankAmericard Secured Credit Card is a solid secured credit card offered by Bank of America. The card requires a minimum refundable security deposit of $300, with a maximum of $4,900. Your maximum credit limit will be determined by the amount of the security deposit you provide, your income, and your ability to pay the credit line established. Bank of America will periodically review your account to see if you qualify to have your security deposit returned. The standard 22.99% APR applies. There is no annual fee for this card

Pros:

This card charges no annual fee.
The security deposit is refundable.
The card is offered by Bank of America.

Cons:

There’s no intro APR offer.
The card provides few rewards.
The minimum deposit is $300.

The Takeaway

If you have poor credit, credit cards might help you improve your credit score, though certain cards are better for that than others. As with any credit card, paying your bill on time and avoiding debt are the best things you can do to establish a stronger credit history. When you’re looking for credit cards, Lantern by SoFi can help. We let you compare multiple credit card offers together in one place so you can choose the option that works best for you.

Photo credit: iStock/RgStudioDisclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website on credit (https://www.consumer.ftc.gov/topics/credit-and-loans)The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.SOLC0921193

About the Author

Jason Steele

Jason Steele has been writing about credit cards and award travel since 2008. One of the nation's leading experts in this field, he has contributed to dozens of personal finance and travel outlets and has been widely quoted in the mainstream media.

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