Consumers develop credit issues for a wide variety of reasons—many of which are circumstantial—job loss, emergencies or health crises. Sometimes, it’s nothing more than bad luck. But until your credit improves, you have two options for the types of credit cards for bad credit: Secured cards and unsecured cards designed for those with poor credit. The differences are outlined here:
* This is generally the case, but check with the specific card issuer
** Card usage alone is not guaranteed to improve your credit, but making on-time payments and demonstrating responsible credit behavior is likely to improve your score.
Should You Get a Credit Card for Bad Credit?
If you have a low credit score and are looking to rebuild your credit, applying for one of the cards on this list could be a good stepping stone toward improving your credit history. But remember: Not all credit cards for those without good credit are created equal. These cards can have significantly different fees, reward structures or security deposit requirements. Choosing the right card will depend on a combination of your personal financial history and your financial goals.
Forbes Advisor Credit Cards Writers Cole Schenewerk and Barbara King contributed to this article.
The Secured Chime Credit Builder Visa® Credit Card is issued by The Bancorp Bank, N.A. or Stride Bank, N.A., pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa credit cards are accepted. Please see the back of your card for its issuing bank.
¹To apply for Credit Builder, you must have received a single qualifying direct deposit of $200 or more to your Chime® Checking Account. The qualifying direct deposit must be from your employer, payroll provider, gig economy payer, or benefits payer by Automated Clearing House (ACH) deposit OR Original Credit Transaction (OCT). Bank ACH transfers, Pay Anyone transfers, verification or trial deposits from financial institutions, peer to peer transfers from services such as PayPal, Cash App, or Venmo, mobile check deposits, cash deposits, one-time direct deposits, such as tax refunds and other similar transactions, and any deposit to which Chime deems to not be a qualifying direct deposit are not qualifying direct deposits.
Money added to Credit Builder will be held in a secured account as collateral for your Credit Builder Visa card, which means you can spend up to this amount on your card. This is money you can use to pay off your charges at the end of every month.
²On-time payment history may have a positive impact on your credit score. Late payment may negatively impact your credit score. Chime will report your activities to Transunion®, Experian®, and Equifax®. Impact on your credit may vary, as Credit scores are independently determined by credit bureaus based on a number of factors including the financial decisions you make with other financial services organizations.
³Out-of-network ATM withdrawal and OTC advance fees may apply. View The Bancorp agreement or Stride agreement for details; see back of card for issuer.