Average FICO Score in the U.S.
According to Experian’s 2019 State of Credit study, the average U.S. consumer’s FICO score hit a record high of 703 in 2019. This score is measured on a scale of 300 to 850, with fewer than 100 points separating the cities with the highest and lowest average scores. While a credit score below the national average may not be ideal, there are options available for individuals looking to improve their credit.
Negative Consequences of Bad Credit
Even fair credit, and certainly poor credit, can have real-world consequences. It is important to take steps to build credit over time and boost your credit score to avoid these negative consequences. One way to start building credit is by obtaining a credit card designed for individuals with bad credit.
Best Credit Cards for Bad Credit
There are several credit cards available for people with bad credit. Here are some of the best options:
Credit One Bank Platinum Visa for Rebuilding Credit
- Up to 10% on purchases with select merchants
- Rewards post automatically to your account balance each month
- Lax underwriting requirements
- Automatic consideration for credit line increases
This credit card is a great starter option for those with bad credit.
Capital One QuicksilverOne Cash Rewards Credit Card
- Unsecured credit card
- Earns 1.5% cash back on all purchases
- Redeem cash-back rewards for statement credits or bank account deposits
- Get a higher credit line with on-time payments
This card is a good choice for those with less-than-perfect credit and offers a cash-back rewards program.
Secured Sable ONE Credit Card
- Low regular APR
- Pathway to unsecured status in as little as 4 months
- $25 bonus for increasing credit score to 700+
- Earn 2% cash back on everyday purchases
This secured credit card caters to a wide range of potential cardholders and offers a low APR.
OpenSky Secured Visa Credit Card
- No credit check required
- Requires an upfront refundable deposit
- Your credit limit is equal to your deposited amount
- Regular reporting to major credit bureaus
This card is a good option for those with poor or nonexistent credit.
Petal 1 ‘No Annual Fee’ Visa Credit Card
- Doesn’t require credit underwriting
- Higher credit limit as high as $5,000
- Uses nontraditional cash flow underwriting
This card offers a higher credit limit and doesn’t require a credit check.
Indigo Platinum Mastercard
- Smooth underwriting process
- Unsecured credit card
- Annual fee ranges from $0 to $99
This card offers a smooth underwriting process and doesn’t require a security deposit.
Important Factors to Consider
When choosing a credit card for bad credit, consider the following factors:
- Security deposit requirements
- Starting credit limits
- Annual fees
- Additional fees
- Interest rates
- Rewards programs
It’s important to make timely payments and use your credit responsibly to improve your credit score over time. As your credit improves, you may qualify for better credit card options with higher spending limits, lower APRs, and better rewards programs.
While having bad credit can limit your options, there are credit cards available to help you build credit and improve your financial situation. Choose a card that aligns with your needs and credit goals, and use it responsibly to pave the way for a better credit future.