Best credit cards for bad credit in January 2025

We thoroughly rate and research the best cards for bad credit based on key criteria to help you make confident decisions when choosing your next credit card. Learn more about our methodology below.

Two types of credit cards commonly available to people with bad credit are secured cards and unsecured cards. Both have notable advantages and disadvantages, so deciding which one is best for you may come down to a few key differences.

A secured credit card usually requires a security deposit, which determines and often matches your credit limit. Credit-building features can also include reporting your credit activity to credit bureaus, late fee forgiveness and credit monitoring. 

These cards are ideal when you’re starting to build or need to repair your credit. Many of these cards offer preapproval, so it won’t hurt your credit to check your approval odds. Some don’t charge an annual fee, so you can focus on building credit without gaining any unnecessary debt.

Unsecured credit cards for bad credit differ slightly from secured cards. They do not require a security deposit, but sometimes charge annual fees. If you don’t want to — or can’t — provide the funds for a security deposit, unsecured cards for bad credit would be the better option, though they usually aren’t as common and don’t always have the best terms.

We typically advise people to avoid unsecured credit cards for bad credit whenever possible since they tend to have high APRs (even higher than on some secured cards) and can impose various fees. It’s also rare that these cards come with benefits like rewards despite being unsecured.

Tips on choosing a credit card for bad credit

A card for bad credit can be useful in providing credit if you can’t qualify for better options. However, it’s important to choose the best one that will help you reach your financial goals. Here are some tips to keep in mind as you shop around:

1. Look for credit-building features: If you want to upgrade your card sooner than later, features like credit monitoring and automatic credit line reviews can come in handy for boosting your credit score.
2. Check the fees: Be aware of more than the annual fee. The card can also be expensive due to ATM fees, late fees, and penalty fees.
3. See if there are upgrade opportunities. Some cards allow you to upgrade from a secured card to an unsecured card or increase your credit limit after you show good credit habits.
4. Find preapproval offers: Too many hard inquiries can cause your credit score to dip. Preapprovals show you your chances of being approved for a card so you can apply for cards with confidence.

Perks to look out for on cards with bad credit

While cards for bad credit have fewer perks, benefits are usually different on secured and unsecured cards. Here’s what you should look out for: 

A credit card can still be a helpful tool for building credit, even with bad credit. You can use a card to establish credit, boost your credit file or fix past credit mistakes. Here’s when it’s smart to use a credit card for bad credit: 

• When you’re ready to repair your credit. If you’re ready to rebuild credit, a credit card for bad credit can help get you back on track. As long as you make on-time payments, keep your credit utilization ratio under 30 percent and practice other responsible credit habits, you can work toward a better credit score and card options. 
• When you have a limited credit history. While you may not necessarily have bad credit, not having any credit can be just as restrictive. Many credit cards for bad credit are also some of the best for no credit history. People new to credit can try starter credit cards, and first-generation credit users can find cards that meet their needs in many of our featured cards.
• When you want options for an emergency. Credit cards for bad credit often don’t have a high credit limit. However, a little can go a long way when it comes to a last-minute expense or emergency. While it won’t replace an emergency fund, it can be useful when you’re in a bind. 
• When you need to make purchases without cash. Some expenses can’t be paid with cash or check. Having a credit card can simplify and automate payments. It can also be a good payment alternative if you don’t have a bank account.

While improving your credit score can feel like an uphill battle, cultivating good credit habits and exercising patience will pay off. Here are a few tips to remember when trying to boost your credit.

• Maintain responsible financial habits with a credit card. One of the most effective ways to build credit is by using a credit card. While a few factors are more important than others when calculating your score, consistent and positive credit management over time is the key to seeing results. Once you apply for a credit card, establish a budget to avoid overspending and risk further damaging your credit score. Take advantage of free credit management tools and monitor your progress closely.
• Use alternative options (only if necessary).  If using a credit card to build credit isn’t the best option for you and your needs, you can explore alternative ways to build credit without a credit card. Other financial tools like credit-builder loans and alternative reporting data are among the most popular ways to build credit without a credit card. If you need more help, you could explore credit repair options or pursue credit counseling.
• Seek professional assistance. Do your research while exploring credit repair or counseling. Some bad actors do exist, and scammers may be more inclined to target people with bad credit. Check with the National Foundation for Credit Counseling or your local Financial Empowerment Center for help identifying legitimate credit counseling and repair services.

Crowd-sourcing encouragement and advice may help you find the strategy you need to get your credit back on track. Public forums like Reddit are a great place to find advice and tips from users who share or have experienced a similar financial situation as you.

Bad credit is a common experience among several people. One user who posted in the r/badcredit subreddit seems to summarize several stories about bad credit, sharing familiar themes of “some late payments and high credit utilization.” Searching for advice, they express a willingness to improve their score but aren’t sure where to begin.

There isn’t much good advice in the thread, and some users even offered to let the original poster become an authorized user on their own cards — but this is risky. You shouldn’t get financially involved with a stranger on the internet, so be careful of offers like this if you seek help. However, if you have someone in your life with a good credit score whom you trust, you can ask if they’re willing to make you an authorized user on their credit card. This can boost your score and help you rebound from bad credit. Other than that, the staple strategies for building credit are paying your credit card bill on time, exercising responsibility with credit and patience.

In another thread about rebuilding bad credit, a user comments that the “pre-approval applications for Discover and Capital One will let you know if you are likely to be approved for a basic no annual fee unsecured card or the secured option.” This is true, and features like this make cards like the Discover it Secured Credit Card and Capital One Platinum Secured Credit Card great cards for building or rebuilding your bad credit score.

*The quotes and citations included on this page have been verified by our editorial team and are accurate as of the posting date. Be sure to check the issuer's website/terms and conditions for all up-to-date content. Outlinked content may contain views and opinions that do not reflect the views and opinions of Bankrate.

Still unsure if a credit card is right for you even if you have bad credit? Check out our Credit Card Spender Type Tool, where you can get personalized credit card recommendations based on your credit score, spending habits and daily needs.

Have more questions for our credit cards editors? Feel free to send us an email, find us on Facebook, or Tweet us @Bankrate.

For Capital One products listed on this page, some of the benefits may be provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply.

*The information about the Bank of America Customized Cash Rewards Secured Credit Card has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.

How we assess the best credit cards for people with bad credit

When evaluating the best cards for building credit, we consider a mix of factors, including how cards score in our proprietary card rating system and whether cards offer features that make it easy to build credit history while minimizing costs.

We analyzed over 50 of the most popular cards designed for people with no credit history, bad credit or a fair credit score and rated each based on its cost, APR, credit-building features and more to determine whether it belonged in this month’s roundup.

Here are some of the key factors that we considered and how they’re factored into our card ratings: