The right credit card for bad credit, when used responsibly, is the best tool for rebuilding your credit standing after financial missteps (certain offers are sponsored). Responsible use means making on-time payments every month and not maxing out your spending limit. This results in positive information being added to your credit reports each month. And that gradually reduces the impact of the mistakes – such as bankruptcy, charge-offs or missed payments – that are causing your poor credit.
In most cases, the right credit card for bad credit is going to be a secured card. Secured credit cards charge the lowest fees and offer the best approval odds. But if you need a small emergency loan, you’ll have to compare unsecured cards for people with bad credit, which tend to be pretty expensive. Finally, avoid falling for the trap of thinking a prepaid card can help you build credit. While some advertisements might suggest that, it’s simply not true.
If you’re not sure which card to get, you can’t go wrong with one of our editors’ favorites, which were selected from 1,000+ offers.
WALLETHUB’S BEST CREDIT CARDS FOR BAD CREDIT OF 2018:
4 tips for getting the best credit card for bad credit
Focus on secured cards. Secured credit cards offer the highest chances of approval because they require you to place a security deposit that acts as your credit line. This deposit also prevents the need to charge fees, making secured cards the cheapest way to rebuild credit.
Get current on all your bills. For starters, there’s no point in adding to your obligations if you don’t have all your ducks in a row. Plus, many credit cards for bad credit won’t approve you if have any recent delinquencies, according to WalletHub’s Secured Card Report.
Don’t confuse secured cards with guaranteed approval. While secured cards offer the closest thing you can get to guaranteed approval, most will still perform a credit check. And certain items on your credit report could disqualify you. For example, some issuers won’t approve secured card applicants who have an unsettled tax lien (e.g. Wells Fargo) or recent delinquency (e.g. Capital One) on their record. If you want a secured card that doesn’t do a credit check, Open Sky Secured is a good option.
Compare offers based on fees. Low-cost credit improvement should be your top priority. One way to keep costs low is to always pay your bill in full, to avoid interest charges. Another is finding a card with low (or no) annual, monthly and one-time fees.