Best Credit Cards if You Have Zero to Low Credit

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by parag
Last Updated: May 17th, 2016
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KEYWORDS:#credit cards #tips #rewards #cash back
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Things happen and while we would all have credit scores in the 800’s, that’s often not the case. Sometimes a low credit score doesn’t even mean you have bad credit, it means that your credit file is “thin.” You don’t have a lot of credit accounts or maybe you have none on which to base a credit score. Even if you have had a mortgage for 20 years, you can have a thin credit file if you’ve not taken out any other lines of credit in that time. 

Young people also typically have thin credit files. Whatever the reason, a thin file or “bad” credit, there are still valid reasons that you need a credit card. If you want to rent a car or a hotel room, often a debit card is not accepted, you need a credit card. A credit card can certainly come in handy during an emergency, perhaps your bank account was hacked and you can’t access cash for a day or two until you get a new debit card. Maybe your budget comes up a little short and you need to buy groceries. A credit card is much better in that situation than a pay day loan. 

It’s not always easy to get a credit card if you have zero to low credit but it is possible. We read the fine print and found the best cards available.

 

Secured Cards

A secured credit card works just the same as a conventional credit card with one exception; you must make a deposit to secure the card and the amount of your deposit is typically, but not always, your credit limit. 

First Progress Platinum Elite MasterCard Secured Credit Card

Deposit: You can open this card with a deposit of just $200 and as much as $2,000.

Credit Line: Your line of credit is equal to your deposit.

Fees: The annual fee is $29 and the APR is 19.99%.

Credit Score: This card requires no credit history and no minimum credit score. The card reports to the three major credit bureaus, TransUnion, Equifax, and Experian every month. This is a real bonus when you’re trying to build or improve your credit score. 

 

Citi Secured MasterCard

Deposit: You can open this card with a deposit from $200-$5,000. 

Credit Line: Your credit line is equal to your deposit. 

Fees: The annual fee is $25 and the APR is 22.24%. 

Credit Score: This card is open to those with new credit histories but is not available if you’ve had a bankruptcy in the past two years. This card reports monthly to the three credit bureaus. 

 

OpenSky Secured Visa Credit Card

Deposit: You can open this card with a deposit from $200-$3,000.

Credit Line: Your credit line is equal to your deposit.

Fees: The annual fee is $35 and the APR is 17.64%.

Credit Score: There isn’t a credit check for this card and it doesn’t even require that you have a bank account. This card reports monthly to the three credit bureaus. 

 

Wells Fargo Secured Visa Card

Deposit: You can open this card with a deposit from $200-$10,000.

Credit Line: Just because you don’t have a credit history or because you have bad credit, it doesn’t mean you don’t have cash. We included this card because you can make a high deposit and your credit line is equal to your deposit. 

Making a large deposit but keeping a low balance before paying it off each month is a good way to quickly improve your credit score because it’s partially based on utilization; how much unused credit you have. For instance, if you have a total credit limit of $1,000 and your balance is $100, your utilization is 10%. The ideal utilization is below 20%. 

Fees: This is another reason we included this card. The annual fee is just $25. The APR is 19.24%.

Credit Score: You can be approved for this card with a “Bad” credit score, a score of 600 or below. Yet another reason we included this card; your payment history will be periodically reviewed and you may be offered an upgrade to an unsecured credit card.

 

First Premier Bank Secured Credit Card

Deposit: You can open this card with a deposit from $200-$3,000. 

Credit Line: Your credit is equal to your deposit.

Fees: The annual fee is a high $150 and the APR is 19.9%. 

Credit Score: There is no credit history required for this card and it reports to the three credit bureaus. 

 

US Bank Secured Card

Deposit: You can open this card with a deposit from $300-$5,000.

Credit Line: Your credit is equal to your deposit.

Fees: The annual fee is $29 and the APR is 19.24%.

Credit Score: You can be approved for this card with a “Bad” credit score, a score of 600 or below or a thin credit file. Your account will be reviewed and considered for an upgrade to a non-secured credit card after just 12 months. Many cards that offer an upgrade don’t do so until you’ve had the card for at least 18 months, so this is a great card for those looking to improve their score quickly. 

 

Secured Cards with Rewards

They aren’t common, but there are some secured cards that offer rewards, including travel rewards!

Discover it Secured Credit Card

Deposit: You can open this card with a deposit from $300-$5,000.

Credit Line: Your credit is equal to your deposit.

Rewards: This is a secured card with rewards and they are some good ones! You get 2% cash back, up to $1,000 per quarter on restaurants and gas. You get an unlimited 1% back on all other purchases. At the end of the first year, Discover will double your cash back. 

Fees: Another great feature of this card is that it has no annual fee which is unusual for secured credit cards. The APR is 23.24%. 

Credit Score: You can be approved for this card with a “Bad” credit score, a score of 600 or below or a thin credit file. Your account will be reviewed and considered for an upgrade to a non-secured credit card after just 12 months. Each statement includes a free FICO score so you can monitor your credit. 

 

AeroMexico Visa Secured Card

Deposit: You can open this card with a deposit from $300-$5,000.

Credit Line: Your credit is equal to your deposit.

Rewards: A secured card with travel rewards! And this card has some good ones even compared to a regular credit card. You earn 2 miles per $1 spent on gas and groceries and 1 point per $1 spent on all other purchases. 

After you make the first transaction with the card, you will receive 5,000 bonus miles and a Complimentary Companion Pass. When you renew your card, you get an additional Companion Pass valued at $99. Your first checked bag, up to 50 pounds, is also free. 

You don’t fly with AeroMexico? No problem, they are partnered with several other frequent flyer programs including Delta and Alaska Airlines. 

Fees: There is an annual fee of $25 and the APR is 22.9%. 

Credit Score: You don’t need a credit history to be approved for this card and can qualify with a “Bad” credit score, a score below 600. You may be eligible for an upgrade to an unsecured card after 12 months. 

 

Non-Secured Cards with Rewards

These cards are conventional credit cards, there is no deposit required and they have rewards! 

Credit One Bank NASCAR Credit Card

Credit Line: Your limit is determined at the time of approval. Your account will be automatically reviewed for possible credit amount increases.  

Rewards: You don’t often find credit cards with low credit requirements that come with rewards but this one does! You get 1% cash back on gas and automotive purchases.

Fees: There is an annual fee from $0-99, depending on your credit score. 

Credit Score: You can be approved for this card with a “Bad” credit score, a score of 600 or below.

 

Credit One Bank Cash Back Rewards

Credit Line: Your limit is determined at the time of approval. Your account will be automatically reviewed for possible credit amount increases.  

Rewards: You get 1% cash back on gas and groceries. The card also provides on-line tracking of your credit score so you can watch your regular payments help to increase your score!

Fees: There is an annual fee from $0-99, depending on your credit score.

Credit Score: You can be approved for this card with a “Bad” credit score, a score of 600 or below.

 

What’s the Verdict?

We usually have a few stand outs when we review cards, but this time there was one card that stood head and shoulders above the others. It’s not true for everyone, but if you need a card that will approve those with thin credit files or a bad credit score, odds are you don’t have tons of extra money to spend and you would like some help building your credit.

Those reasons are why the Discover it is our favorite. It has a low opening deposit of $300, no annual fee, gives pretty good cash back rewards, provides your FICO score monthly, and may upgrade your card to a non-secured one after just 12 months. 

Building or re-building credit can be tough but this card can make it easier. Happy building!

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