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Compare Credit Building Credit Cards in December 2023
OpenSky® Secured Visa® Credit Card
Sometimes life happens to your credit. OpenSky® Secured Visa® Credit Card is designed to help you build it back.
- Can be used anywhere Visa is accepted
- Cardholders can build or improve their credit score over time.
- Does not require a credit check during the application process
First Latitude Platinum Mastercard® Secured Credit Card
Earn 1% Cash Back Rewards on payments made to your First Latitude Secured credit card account.
- Building credit starts immediately when you open your account – just pay your bill on time to establish your credit.*
- Reports to all 3 major credit bureaus
- First Latitude is accepted wherever Mastercard® is accepted, online and worldwide!
Chime Credit Builder Secured Visa® Credit Card
Low credit or no credit, start improving your credit score by 30 points on average with regular, on-time payments2 using the Chime Credit Builder secured Visa® credit card1.
- Start improving your credit score by 30 points on average with regular, on-time payments
- No interest or annual fees
- No credit check to apply
First Digital Mastercard®
Get a result in as little as 60 seconds upon completion of the online application.
- Get the security and convenience of a full-feature, unsecured MasterCard® Credit Card – accepted at millions of merchant and ATM locations worldwide and online.
- Build up your credit history with a card that reports to all three major credit bureaus every month.
- Perfect credit not required for approval; we may approve you when others won’t.
Capital One Platinum Credit Card
No annual or hidden fees. See if you’re approved in seconds
- Help build your credit through responsible use of a card like this
- Be automatically considered for a higher credit line in as little as 6 months
- Monitor your credit score with CreditWise from Capital One. It’s free for everyone
Benefits of Credit Building Credit Cards
Using a credit-building credit card can offer several benefits, particularly for individuals who are looking to establish or improve their credit history. Here are five common advantages of utilizing a credit-building credit card:
Establishing Credit History
A credit-building credit card is designed specifically for individuals with limited or no credit history. By responsibly using the card and making timely payments, you can start building a positive credit history, which is crucial for future credit applications, such as loans or mortgages.
Improving Credit Score
If you have a poor or fair credit score, a credit-building credit card can help you improve it over time. Consistently making on-time payments and keeping your credit utilization low can positively impact your credit score, demonstrating responsible credit management to lenders.
Access to Credit
Credit-building credit cards are often more accessible to individuals with limited credit history or lower credit scores. They may have less stringent approval requirements compared to traditional credit cards, making it easier for those with a limited credit history to obtain credit and begin building a positive financial track record.
Credit Limit Increases
Some credit-building credit cards offer opportunities for credit limit increases based on your responsible card usage. As your credit history improves, you may be eligible for a higher credit limit, which can provide you with greater financial flexibility and demonstrate your creditworthiness to potential lenders.
Financial Discipline and Education
Using a credit-building credit card can promote financial discipline and help you develop responsible spending and payment habits. Regularly monitoring your credit card activity, tracking your expenses, and making on-time payments can contribute to better financial management skills and increased awareness of your financial habits.
It’s important to note that credit-building credit cards often have higher interest rates and fees compared to traditional credit cards. It’s crucial to read and understand the terms and conditions, including any fees associated with the card, and use the card responsibly to avoid accumulating unnecessary debt. Building credit takes time, so patience and consistent responsible credit usage are key to achieving long-term credit improvement.
Frequently Asked Questions (FAQ)
How do you apply for credit cards with bad credit?
If you have poor credit or have no credit at all, it can make it more difficult to apply for a credit card. But, it is by no means impossible, and doing so can help you build your credit.
You can apply to these cards the same way you’d apply to any credit card at most major credit bureaus. Most major credit bureaus allow online applications and will let you know your approval decision in a matter of hours. Sometimes, you’ll be approved fast, often within minutes. This is due to their algorithm in place to process a faster credit check. Sometimes, however, the credit check is more complicated and may take a bit longer.
In most instances, your credit report is the most important tool for deciding if you are eligible for a line of credit.
How do you get approved for credit cards with bad credit?
A secured credit card is the best way to go for someone with poor credit, as they have higher approval ratings and offer lower interest.
However, if you absolutely cannot get approved for a lower interest card, you can apply for an unsecured credit card. Cards with guaranteed approval will mean that the majority of applicants will be able to take on an unsecured credit card or with an unsecured line of credit.
Due to the higher interest of guaranteed approval cards, or cards that you pre-qualify for, you’ll need to be careful how you spend and be disciplined when paying your credit card off each month. Some guaranteed approval cards will offer no credit check as well, making them easier to obtain.
Unsecured cards mean that your interest is not fixed, and as such, you can end up paying more with an unsecured card. Thus, applying for a secured card, such as a Visa card or a Mastercard is likely your best option.
Some credit cards will ask that you use a security deposit to gain access to the card. This security deposit can be anywhere from a few dollars to a few hundred. Your security deposit minimum will be taken when you take out the card.
Keep an eye on card offers to see which are the best for you. You should also look for cards with both cashback rewards and online access to ensure your responsible use of your card.
What are top credit cards for bad credit?
The best credit cards for poor credit depends on how bad your credit it, or if you have any credit at all. Those with no credit history can also utilize these cards.
Some credit cards for those with poor credit, or a limited credit history, include:
- The First Access Visa Card
- A Secured Visa CardDiscover It
- Secured Card Fit Mastercard
- Secured Mastercard
These cards all have extremely high ratings among their users and offer credit cards to those with bad credit or no credit. However, be aware that all of these cards offer extremely high-interest rates, most of which are above 20% Intro APR. This means you’ll need to pay off your card as quickly as possible to avoid paying excessive interest.
You also should be aware that an intro APR means that it can, and likely will, get higher over time. Thus, you should always look for a card with the lowest intro APR.
You should always go for the credit card issuer with no annual fee. However, if your credit history is extremely poor, you may have to give in and pay for the annual fee.
Try not to be blinded by glittery credit card offers, and look underneath those for the card that is best for you.
You can also get a prepaid card to help keep your spending limit in check. With a prepaid card, you’ll simply load an amount onto the card and then spend with that amount, rather than by using a credit line.
Once you’ve had some credit education and have built credit for a while, you’ll be eligible for regular APR. A regular APR is a lower interest rate offered to people with better lines of credit, and a regular APR is often the best available.
Is consolidating credit bad for your credit?
In theory, debt consolidation is a great way to get your bad credit under control. It allows you to pay one monthly payment toward your debt by doing a balance transfer, rather than paying off several credit cards each month. However, it can be bad for your credit if you continue to spend as you did previously after the balance transfer.
If you’re interested in credit repair, it is a great option. But, you must be careful not to succumb to the temptation of taking out more credit after you’ve completed your balance transfer. Remember, the balance transfer is there to help you, not to put you further into debt.
Often, debt consolidation means your card will be interest-free for the first year. As such, you should use this first year with the card to focus on paying off your balance.
Is closing credit cards bad for your credit?
In short, yes. While many people want to cancel their credit cards to ensure they don’t spend on them anymore, it can hurt your credit score to do so. Having a line of credit with a lot of available credit on it is good for your credit score in the long run. This alone can help your credit score and can help you get to your coveted good credit.
It is also good to have in case of an emergency. So, you may consider keeping this card somewhere where you don’t have direct access to it so that you won’t be tempted to spend on it. With responsible card use, this should not be an issue.
Are store credit cards bad for your credit?
Store credit cards can be bad or good for your credit score. It’s all in how you use them. Most store credit cards have a smaller credit limit than traditional credit cards that have a higher credit line, which means those with limited credit history can use them to build credit.
If you use them responsibly, they can be a great way to build on your credit. If you spend on them without thinking, this can lead to trouble down the road. Though these lines of credit are only for eligible purchases, if you’re responsible, you can ensure that you use them to improve your credit score. With responsible card use, you can see your credit report improve rather quickly.
Is having too many credit cards bad for your credit?
Many people fall into the trap of having too many credit cards. This is especially the case if they fall into the trap of using a balance transfer to consolidate their loans, especially where there is no fee for the first year. As we stated above, the balance transfer is to help you, not hurt you, but too many people fall into this trap.
Opening too many credit cards in quick succession, and not paying them can also create issues. In general, you’ll want to ensure that you don’t owe more than 30% of your total credit limit.
As long as you ensure you do not make a late payment and that your credit use is in line with your credit limit, you should be fine. You can also link your credit card to your checking account and set up automatic payments to ensure you don’t make a late payment.
What are the costs of poor credit?
Your credit score is set up to tell creditors information about you as a borrower. If your score is low, it means you are a higher risk for lenders. It also means you are likely to pay more in fees and interest rates every time you need to use credit.
While these cards may have higher costs, fees, and interest, the goal should be to use them to improve your overall credit score.
What are the differences between secured and unsecured credit cards?
Credit cards for those with poor credit come in two forms, secured and unsecured.
A secured card means the cardholder has provided a financial payment to the credit card company as security. In many cases, the holder pays a deposit which is then equal to the credit limit on the card. As the cardholder’s credit improves, the credit limit can increase without an additional deposit.
An unsecured card means the card is issued without a deposit. While in theory, this might sound like a better option, often it isn’t because the fees and interest rate are much higher on an unsecured card.
Consider these options when looking for good credit cards for poor credit.
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