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Best unsecured credit cards for bad credit

Compare these 3+ unsecured credit cards and start building your credit.

An unsecured card is often a good choice for those who can’t afford to make a $200 secured deposit right away to get a secured card. But because there’s no deposit, this type of card often comes with a host of fees. Finder’s credit card experts spent hundreds of hours comparing over 50 unsecured cards for bad credit and chose the top five that had the lowest fees, reported to the three major credit bureaus, and boasted with additional perks.

In 2020, Petal came out with a new card that is geared toward people with a 550 credit score and higher, which is right on the cusp of bad and fair. This is the only card in this category that doesn’t charge an annual fee.

Our top picks for unsecured credit cards for bad credit

These cards offer some excellent perks considering they’re designed for people with no or poor credit.

Petal® 1 "No Annual Fee" Visa® Credit Card

Finder rating 4.5 / 5 ★★★★★

Apply now
on WebBank's secure site
The Petal® 1 "No Annual Fee" Visa® Credit Card is Petal's newest card for credit-building. This card is designed so that those with a prior history of poor credit can apply and potentially qualify. While this card doesn't share the NO FEE structure of the Petal 2, it does carry no annual fee and requires no security deposit, making it a strong choice for rebuilding credit without taxing your bank account.

Credit One Bank® Platinum Visa® for Rebuilding Credit

Finder rating 3.5 / 5 ★★★★★

Apply now
on Credit One Bank®'s secure site
The Credit One Bank® Platinum Visa® for Rebuilding Credit is a basic starter credit card that's aimed at helping those with bad credit recover. This card earns 1% cash back on all purchases and offers flexible payment due dates, helping you to consistently make payments on time.

Indigo® Platinum Mastercard® Credit Card

Finder rating 3.8 / 5 ★★★★★

While the Indigo® Platinum Mastercard® Credit Card may carry a $99 annual fee after the first year, the card does allow you to prequalify which can help avoid the credit ding of a hard pull on your score. Plus, depending on your credit score, Celtic Bank may waive the annual fee entirely. Just take care to make your payments on time: the Indigo Platinum sports a high penalty APR of 29.9% and late fees of up to $40.

Destiny Mastercard®

Apply now
on First Electronic Bank's secure site
This is a rare card among unsecured cards for bad credit because it comes with no cash advance fees during your first year of card membership. For those who need to make cash advances, this could be the right card.

How to compare unsecured credit cards for bad credit

There are some features to keep in mind when you compare unsecured cards for bad credit, including:

  • Reporting to credit bureaus. To build credit, the card you’re approved for must report your card activity to all three major credit bureaus — TransUnion, Equifax, Experian. Otherwise, you will never build your credit.
  • Annual fee. Unsecured cards are expensive. That’s because they risk providing you with credit that you may fail to pay off. Expect to pay anywhere between $49 and $300 each year for an unsecured card for bad credit.
  • Other fees. Check the card’s terms and conditions before you submit your application to know what you’re getting in to. Some unsecured cards for bad credit are known to have a host of hidden fees.

5 things to know about unsecured cards for bad credit

Here’s what you need to know to better understand this type of cards:

  • Unsecured cards for bad credit don’t require a deposit. This is useful for those who can’t afford to make a deposit of $200 or $300 to get a secured card for building credit.
  • Almost every unsecured card for bad credit comes with an annual fee. Expect to pay anywhere from $49 to $300 annually, depending on which card you choose.
  • Is guaranteed approval a thing? You could find cards with guaranteed approval but they’re likely to come with a lot of fees to make up for it.
  • Do all cards do a credit check? Once you apply, yes. However, a decent number of cards come with a prequalification tool. You can choose to apply only if the chances of approval are high.
  • Do they come with rewards? Some of them do, but in most cases it depends on your creditworthiness.

Compare unsecured credit cards for bad credit

Check out the options for building your credit with an unsecured credit card.

Name Product Filter values Rewards Purchase APR Annual fee
Tomo Credit Card
1% cashback on all purchases
N/A
$0
A credit-building card with no fees, no APR, and no credit check.
Credit One Bank® Platinum Visa®
1% cash back on eligible gas, grocery purchases and mobile phone service, internet, cable and satellite TV services
23.99% variable
$39
Earn 1% cash back rewards on eligible gas, grocery purchases and mobile phone service, internet, cable and satellite TV services.
PCB Secured Visa®
N/A
18.9% fixed
$39
Choose your initial deposit amount and credit limit from $200 to $1000. Rates & fees
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Compare up to 4 providers

What if you’re not approved?

If you’re rejected for an unsecured credit card, you’ll want to do the following:

  • Call the credit card company’s reconsideration line. This number is usually printed on the rejection letter the bank sends you 7 to 10 days after it makes its lending decision. Ask the customer service representative why you were denied and if you can work with them to reconsider the bank’s decision.
  • Consider applying for a secured credit card. Secured credit cards require a cash deposit upfront that acts as the credit line for the card. While these tend to have smaller credit limits or unfavorable fees, lenders are more likely to approve someone with bad credit for a secured card because they can apply the collateral to the card’s balance if you miss a payment. Secured credit cards act similarly to an unsecured card on your credit report, as long as the lender reports to all three credit bureaus, so make sure to keep up on your payments. Keep in mind that late payments will still hurt your score even if your cash collateral is used to cover a missed payment. Check out our guide to secured credit cards for more information.
  • Don’t reapply too quickly. When you apply for a credit card and are rejected, this can show up on your credit report as a hard pull, which can put a small dent into your credit score. Wait a few months to apply for another card to avoid a large credit score drop.
  • Work on paying off your existing debts. Anything you can do to bolster your credit score while you wait to reapply will improve your chances of approval. You have quite a few ways to build credit without a credit card, so make a plan and stick to it.

Further improving your credit

If you’re approved for an unsecured or secured credit card, you’re already on track to improving your credit score. Make sure to manage your credit card properly by making regular, on-time payments. Keep your balances low and make sure to pay off any accounts in collections. Check out our guide to improving your credit score for more information.

It’s also a good idea to keep an eye on your credit score. Most credit card issuers give you free access to your FICO score. If you don’t yet have a credit card, free credit monitoring software like Credit Sesame will give you free access to your credit score and history.

Many providers will check your credit, and you could be declined if your score is too low. If you’re denied, try applying for a different credit card with a provider that doesn’t look at your credit history.

Bottom line

Even if you have bad credit, you can still find unsecured credit cards out there that may be a good fit for your financial situation. While these credit cards typically don’t offer high credit lines or many perks, using them responsibly and paying off your balance each month will help you qualify for better credit cards.

If you’re still having a hard time getting approved for one of these unsecured credit cards, you might want to look at our top picks for secured credit cards. Once you’ve had the card for at least a year and have proven you’re capable of making on-time repayments each month, you may be able to upgrade to the unsecured version of the card. If not, try check out other credit cards for bad credit and try your luck again.

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