Unsecured Credit Cards for Bad Credit: Top Options & Guide | Money Under 30

A credit card can be a useful financial tool. But if you have bad credit, it can be difficult to obtain an unsecured credit card. Luckily, a handful of unsecured credit cards are willing to work with borrowers that have bad credit. 

If you are struggling to find a credit card that works with your bad credit, look no further. I’ve created a guide to the best unsecured credit cards that can help you even if you have bad credit. 

Let’s take a closer look at the best unsecured credit cards for bad credit. 

Overview of the best unsecured credit cards for bad credit

• Annual fee: $0 - $99.
• APR range: 24.9%.
• Rewards: N/A.
• Other features: Accepts applicants with bankruptcy history.

The goal of the Indigo® Mastercard® is to help cardholders build – or rebuild – their credit score. The card is issued by the Celtic Bank based out of Salt Lake City. Whether you have poor credit or no credit, the Indigo® Mastercard® Credit Card can help you get your credit back on the right track. You can even get approved for this card if you have a bankruptcy in your financial past. 

Before you apply for this credit card, you’ll have the opportunity to receive a pre-qualification done with a soft credit pull. That means you can find out if you qualify for the card without impacting your credit score. When you apply for this card, you’ll have a fast decision on your application. 

Once you are approved, you’ll find an APR of 24.9%. The annual fee for this card can potentially be $0 for some applicants. But others will be facing an annual fee between $0 - $99.

Beyond the credit building benefits that come with regular reporting to three top credit bureaus, the Indigo® Mastercard® Credit Card offers some top tier perks for a relatively low range card. A few include master RoadAssist services, Travel assistance services, Master rental insurance, extended warranty coverage, and price protection. 

Learn more about the Indigo® Mastercard® Credit Card or read our full review.

• Annual fee: $35 - $99*.
• APR range: 24.9%.
• Rewards: N/A.
• Other features: Free custom card designs.

A bad credit score can be the result of any number of financial situations. No matter how your credit score is now, the Milestone Mastercard® is a good option to help you rebuild. 

Before you apply for the Milestone Mastercard®, you’ll be able to check out a pre-qualification. With that, you won’t have to further damage your credit with a hard credit pull if things aren’t going to work out. Once you’ve seen that you’ll be approved, you can submit an application to officially obtain the card. After you’ve got the card, you’ll be able to rebuild your credit through on-time payments that will be reported to three credit bureaus. 

Depending on your application, you’ll pay an annual fee of $35 - $99*. Whatever your annual fee is, it will be deducted from your credit limit. With that, if you receive a credit limit of $300, the actual credit limit will be $225 if you have a $75 annual fee. 

The ability to rebuild your credit is the main feature of this card. But there are other features such as extended warranty coverage, price protection, and custom card designs that make this care stand out. 

Learn more about the Milestone Mastercard® or read our full review.

• Annual fee: $0 - $99.
• APR range: 17.99% to 23.99% Variable.
• Rewards: 1% cash back.
• Other features: Monitors for higher credit line eligibility with automatic alerts.

• Annual fee: $75 for the first year. After that, $99 annually ($8.25 per month).
• APR range: 23.99% Variable.
• Rewards: 1% cash back rewards on eligible gas, grocery purchases, and communication services like mobile phone, internet, cable and satellite TV services. Terms apply.
• Other features: Monitors for higher credit line eligibility with automatic alerts.

The name of this card says it all – the Credit One Bank® Platinum Visa® for Rebuilding Credit is designed to help you rebuild credit. All of your payments will be reported to three credit bureaus, which means that if you make on-time payments your credit score will increase over time. 

A big benefit of this card is the 1% cash back rewards on eligible spending. Since most credit cards for poor credit borrowers don’t offer any cash back rewards, this can be enticing. 

In contrast, the biggest drawback is the potential lack of a grace period to make payments without incurring interest charges. You’ll find out whether or not you’ve received a grace period after you apply for the card. If there isn’t a grace period, you could incur interest charges on the day you make the purchase. With that, it is critical to be careful with your spending if you don’t receive a grace period.

Learn more about the Credit One Bank® Visa® for Rebuilding Credit or read our full review.

Summary of the best unsecured credit cards for bad credit

How I came up with this list

Curious about how these credit cards made the cut? Here’s how I came up with this list:

Cards that work with low credit scores

If you are looking for a credit card with bad credit, the options can be somewhat limited. Unfortunately, many credit card issuers are unwilling to work with you if you have a poor credit score or no credit history at all. 

With that, I only included cards that can work with low credit borrowers. 

Reported to major credit bureaus

If you have bad credit, chances are you want to improve that credit score. But if the issuer doesn’t report your payments to the big credit bureaus, your score is unlikely to rise over time. 

I selected cards that report to the major credit bureaus. This should help you boost your score with responsible payments. 

Low annual fee

I only put cards on this if it had an annual fee of $100 or lower. You’d be surprised how quickly annual fees can add up!

What is an unsecured credit card for bad credit?

If you have bad credit or no credit, it can be difficult to find a credit card. In general, credit scores under 600 are considered ‘bad.’ Although this is not a reflection of your personal character, it can impact your ability to open an unsecured credit card. 

In many cases, people with bad credit resort to secured credit cards. A secured credit card will require a deposit to open which will usually match your credit limit. An unsecured credit card doesn’t require a deposit to get started. 

If you don’t want to make a deposit for a secured credit card, then looking for unsecured credit cards that work with bad credit is a good option. 

Why should (or shouldn’t) you use an unsecured credit card if you have bad credit

So is an unsecured credit card right for you?

Why you should use an unsecured credit card

If you have bad credit, an unsecured credit card can help you build or rebuild your credit score. An unsecured credit card is a great choice if you are able to manage your spending responsibly and make on-time payments. 

Once you’ve built up your credit score, you can transition into a credit card with better perks. 

Why you shouldn’t use an unsecured credit card

An unsecured credit card might not be a good idea if you are easily tempted by a higher credit limit. If you overspend with an unsecured credit card, it could end up hurting your credit score instead of helping. 

Most important features of unsecured credit cards for bad credit

Here’s what to keep an eye out for:

Annual fee

A high annual fee could be a big issue for your budget. Make sure that you are able to comfortably afford a card’s annual fee before applying.

APR

The APR of a credit card is an important factor to consider. A lower APR can mean fewer interest charges. But if you are planning to make on-time payments within a grace period, the APR may not be as big of an issue. 

Grace period

A grace period between your purchase and the interest charges is key. If there isn’t a grace period, you could get stuck paying more interest charges than you anticipate. 

Credit reporting

The goal of an unsecured credit card for bad credit is to boost your credit score. With that, it is critical that the issuer reports your payments to the major credit bureaus – Experian, Equifax, and TransUnion. 

Extra perks

After you consider the features above, other perks like cash back and protections can come into play. Although extra perks shouldn’t necessarily be the deciding factor, it is worth choosing a card that has perks that you can actually use. 

Summary

It is possible to find an unsecured credit card that works for your bad credit history. Take some time to consider your options and then apply for a credit card that will help you rebuild your credit today.

Read more:

• Best Personal Loans For Bad Credit (Credit Score Under 600)
• Best Credit Cards If Your Credit Score Is Under 599 (Bad Credit)