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Key takeaways
- Unsecured credit cards for bad credit with no deposit provide an opportunity for individuals with poor credit to improve their scores without the initial financial burden of a security deposit.
- Responsible use is crucial. Whether you have a secured or unsecured card, keep your balances low, pay your bills on time, and apply for new cards sparingly. Gradually your score will improve.
- Prequalify before you apply to assess your eligibility without negatively impacting your score.
Credit cards for bad credit no deposit offer a glimmer of hope for individuals struggling to rebuild their credit. Like it or not, your score is important. It affects what interest rate you’re offered, fees lenders charge, and even if you can get the apartment you have your eye on.
Discover related topics
Secured cards are a great way to improve your score, but not everyone wants one or has the cash on hand to make a deposit. That’s where no deposit credit cards for bad credit come in. These cards have minimal requirements for approval making them easy to qualify for.
Jump to:
- Best unsecured credit cards for bad credit comparison
- What is an unsecured credit card for bad credit?
- Types of unsecured credit cards
- Are secured or unsecured credit cards best for rebuilding credit?
- How to make the most of second-chance cards with no security deposit
- Can you get an unsecured credit card after bankruptcy?
- Frequently Asked Questions
- Bottom Line
Best unsecured credit cards for bad credit comparison
Unsecured cards for low scores are easy to qualify for and do not require a security deposit, but they do come with high costs and meager benefits. Before you accept an offer, be sure you understand the APRs and fees these cards charge.
Here are our top picks for credit cards for bad credit with no deposit.
Initial Credit Limit of $400
Fortiva® Mastercard®
Fortiva® Mastercard® is a decent rewards card for people with low scores. It has minimal requirements, offers a high initial limit, and cash back rewards up to 3% on eligible purchases.
Fortiva® Mastercard® is a cash back rewards card tailored for individuals working on improving their scores. It does not require a security deposit, lets you prequalify, and sends you your score for free every month. While it has low score requirements, it does come with higher fees and interest rates. Pay off your balance in full each month and you’ll get to enjoy rewards without paying a dime in interest.
Aspire® Cash Back Reward Card
Aspire® Mastercard® is a rare rewards card for consumers with fair scores. It provides a higher than usual initial limit of up to $1,000, cash back on all purchases, and the option to prequalify instantly.
The Aspire® Cash Back Reward Card is another stand out rewards card for low scores. You get 3% cash back on gas, groceries, and utilities plus 1% cash back on all other purchases. Aspire® can be a good tool for anyone looking to improve their score while enjoying the benefits of a rewards card, albeit with higher fees and interest rates.
Indigo Mastercard®
Indigo Mastercard® stands out with its new higher limit for low scores. It’s easy to be approved for without a security deposit, reports monthly payments, offers fraud protection.
The Indigo Mastercard® is a pretty good basic card for rebuilding scores without a security deposit. While it might not offer rewards like some other cards, it does report payment history to all three bureaus, features an easy application process, and a new higher limit. Like the others, it does come with high fees and APRs.
FIT® Platinum Mastercard®
FIT® Platinum Mastercard® is a pretty good card for people with low scores. It’s easy to be approved for, reports your monthly payments, and offers a limit increase after only six months.
The FIT Platinum Mastercard® is another card for low scores that promises to double your limit after only six months of on time payments. It sports a fast and easy application with instant approval so you don’t have to wait. Be prepared though for many fees and a high APR as the cost of subprime cards.
Surge® Platinum Mastercard®
Surge® Platinum Mastercard® is a rare card for low scores that provides higher line of up to $1,000 and the chance to double it after six months of responsible use.
The Surge Platinum Mastercard® is a rare card for poor scores that gives an initial limit of up to $1,000. Plus you can double it after only six months of responsible use. Surge lets you prequalify and receive an instant decision. Be aware of additional fees and a high APR as a result.
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What is an unsecured credit card for bad credit?
An unsecured card for bad credit is one that accepts applicants with poor or fair scores and does not require a cash deposit. Secured credit cards require a refundable security deposit as collateral but tend to accept applicants with lower scores.
The marketing phrase “guaranteed approval unsecured credit cards for bad credit no deposit” often refers to these types of cards, suggesting a higher chance of approval without the need for upfront cash.
However, it’s important to understand that guaranteed approval does not actually exist. No issuer approves every single applicant. The cards we’ve selected have minimal requirements making them very easy to qualify for.
What separates unsecured cards for poor scores from other unsecured cards is their fee structure. Due to the higher risk issuers take on lending to people with less-than-perfect scores they will often charge higher interest rates and additional fees.
Tacked-on fees you’ll only find on subprime cards include:
- Signup fees or processing fees
- Monthly maintenance fees
- Credit limit increase fees
- Extra card fees
All the fees make it hard for the issuer to lose money if the consumer doesn’t pay their bill.
Carefully consider these costs when applying for unsecured credit cards for bad credit with no deposit. While these cards offer a valuable opportunity to improve your score, the associated fees and interest rates can make them unaffordable.
Types of unsecured credit cards
An unsecured credit card is any card that does not require a security deposit. Traditional credit cards are unsecured. There are plenty of types of cards each offering its own benefits. Some credit cards for bad credit with no deposit even offer instant approval. Here’s a look at a few types on the market:
New
Credit Union Cards
Credit unions are friendlier than banks and many offer cards with different requirements. They typically have more favorable terms compared to traditional banks including relatively low APRs and costs. The rewards may not be as robust but then it’s hard to find a card for low scores with lucrative rewards.
Cash Back Cards
Cash back rewards cards are a popular choice for many, offering a percentage of spending back to the cardholder. Most rewards cards are geared towards consumers with good scores, but a few including Fortiva® Mastercard® and Aspire® Cash Back Reward Card will consider applicants with poor scores. Rewards cards tend to have higher APRs to offset the rewards. Pay your bill in full every month and you can keep your cash back without any interest payments.
Credit Builder Cards
Most subprime cards focus on building your score. They report payments to all three major credit bureaus – Equifax, Experian, and TransUnion – and give consumers access to their score for free every month. Many of these cards – like the ones we’ve listed above – have lenient requirements and will approve applicants with poor or fair scores.
Are secured or unsecured credit cards best for rebuilding credit?
Secured and unsecured cards are both good for increasing your score as long as the issuer reports your payments to all three major credit bureaus. Your score is mainly determined by your payment history and utilization. It does not matter if you’re using a secured or unsecured card.
Both secured and unsecured cards are:
- Issued by major financial institutions
- Can be used to make in-store purchases
- Can be used to make online purchases
- Will impact your score
- Let you carry a balance
The only difference is that secured cards require a refundable security deposit. The deposit serves as collateral and typically sets your limit. They are often recommended for individuals with very poor scores or no credit history at all. When you have a secured card you still have to pay your bill on time every month, will still be charged interest on purchases, and utilization still counts.
Both secured cards and unsecured cards will help you boost your score with responsible use.
Interested in a secured credit card?
Learn more about secured cards and how they can help improve your score.
How to make the most of second-chance cards with no security deposit
Owning a card is enough to establish your credit history but to build your score you have to use your card responsibly.
Factors that contribute to your score are:
- Payment History 35%
- Amount Owed 30%
- Age of Accounts 15%
- Credit Mix 10%
- New Credit 10%
Let’s go over practical ways to improve your score.
Maintain Low Balances
Keeping your card balances low is crucial. Aim to use less than 30% of your available credit. A low utilization rate demonstrates responsible habits and that you’re not overly reliant on borrowing money.
To keep your balances low, make multiple payments throughout the month. This can be an especially helpful practice if you have a low limit like $300. An alternative is to request a limit increase. Your issuer may approve a higher credit line if you’ve made consistent monthly payments.
Make Payments On Time
The best thing you can do is pay your credit card bill on time every month. You need to make at least the minimum payment to be considered on time but it’s even better to pay in full and avoid interest. Set up automatic payments each month or request an alert when the bill is due to ensure timely payments.
Late or missed payments incur late fees and potentially a penalty APR – a few points higher than your regular APR. Payments that are more than 30 days late will be reported to the credit bureaus and cause your score to drop by dozens of points. Late payments stay on your report for up to seven years, though the damage they do lessens over time.
Conversely, consistently paying on time will establish a positive payment history – the most important factor in determining your score – and significantly improve your score over time.
Refrain from Too Many Applications
Each application triggers a hard inquiry on your credit report and will lower your score by 5 to 10 points. Occasionally applying is fine and won’t do too much damage. Your score will bounce back within a few months to a year.
Too many applications within a short period will ding your score and are considered a red flag by lenders. Wait at least six months between applications to avoid these negative impacts.
Don’t Close Old Accounts
The age of your accounts plays a role in determining your score. Lenders want to see that you have a long history of borrowing responsibly. Closing old accounts decreases the average account age so it’s better to keep your cards open and active. Aim to use them once a year so that the issuer won’t close them. The exception to the rule is if one of your cards has a lot of fees, it may be worth closing.
Have a Mix of Credit
A diverse mix of accounts (both cards and loans) reflects well on your score since it demonstrates your ability to manage different types of borrowing responsibly. That said, never take on debt simply to improve your score. It is possible to get a very good or excellent score with only cards.
Improving your score takes time but if your score was very low, you may see big improvements fast.
Learn more about how to improve your score on MoneyFor.
Can you get an unsecured credit card after bankruptcy?
When you have a recent bankruptcy it can be hard to qualify for any card, but not impossible. There are subprime cards that will consider applicants as long as their bankruptcy has been discharged. If you do qualify, you’ll get higher interest rates and fees to offset the risk to the issuer.
Do your research, compare options, and try to prequalify. Prequalifying does not guarantee approval but it does show your approval odds without impacting your score.
Once you’re approved, be sure to use your card responsibly. Make payments on time, keep your balances low, and you’ll gradually improve your score post-bankruptcy.
Frequently Asked Questions
Bottom Line
While there is no such thing as a credit card with guaranteed approval, several unsecured cards are exceedingly easy to obtain. If you score is no good, concentrate on feasible choices. Try to prequalify before you apply to see your chances and limit the number of applications you submit.
When you get your card, be sure to use it responsibly. Consistently pay on time and keep your balances low and your score should improve within a year. The better your score, the more options you’ll have.
