What credit cards are actually available to people with low credit scores
If your credit score is below 620, most standard credit cards will reject you. But you have real options: secured credit cards, credit-builder cards, and cards designed for poor credit all exist and are offered by actual banks and credit unions. The catch is that these cards come with higher interest rates, lower credit limits, and annual fees — sometimes all three. The point of using one is not to borrow money cheaply; it is to build a payment history that raises your score over time.
The difference between these card types matters because they work differently. A secured card requires you to put down a cash deposit that becomes your credit limit — you might deposit $500 and get a $500 limit. A credit-builder card from a credit union or online lender works more like a traditional card but reports to all three credit bureaus and is designed for people rebuilding. A poor-credit card from a major issuer (like Capital One or Discover) has no deposit requirement but charges higher fees upfront.
Before you explore, understand that each process triggers a hard inquiry on your credit report, which temporarily lowers your score by a few points. explore to five cards in a week will hurt more than explore to one card per month. Space out your applications if you are considering multiple options.
Key Takeaways
- Secured cards require a cash deposit but report to credit bureaus and help rebuild your score if you pay on time every month.
- Credit-builder cards from credit unions and online lenders often have no deposit but charge annual fees ranging from $25 to $99.
- Poor-credit cards from major issuers charge annual fees and interest rates above 20%, but approval is faster and does not require a deposit.
- Your goal with any of these cards is to keep the balance low, pay the full statement balance on time, and watch your score rise over 6 to 12 months.
- Each credit card process lowers your score slightly, so space applications out by at least a month to avoid multiple hard inquiries.
How secured credit cards work and why they rebuild your score
A secured card is the most straightforward path if you have cash available. You deposit money into a savings account held by the card issuer — typically $200 to $2,500 — and that amount becomes your credit limit. You then use the card like any other card, and the issuer reports your payments to Equifax, Experian, and TransUnion.
The deposit sits untouched in the background. It is not a fee; it is collateral. The bank holds it to protect itself if you stop paying. After 6 to 18 months of on-time payments, many issuers will convert your secured card to a standard card and return your deposit. Some will increase your limit without requiring a larger deposit.
The banks offering secured cards include Capital One (Secured Mastercard), Discover (Secured Card), and most credit unions. Annual fees range from $0 to $95, and interest rates typically fall between 18% and 24%. The fee matters because it comes out of your available credit — if you deposit $500 and pay a $95 annual fee, you effectively have $405 to spend. Read the terms carefully: some cards charge the fee upfront, others charge it after your first statement closes.
The reason this rebuilds your score is straightforward: credit bureaus want to see that you can borrow money and pay it back on time. A secured card proves exactly that. If you charge $50 a month and pay it in full before the due date, you are building the exact payment history that raises scores.
Credit-builder cards from credit unions and online lenders
Credit unions and online lenders like Self and LendingClub offer cards specifically designed for people rebuilding credit. These cards usually have no deposit requirement, which makes them easier to access if you do not have $500 sitting in savings. Instead, they charge annual fees ($25 to $99) and report your payment history to all three credit bureaus.
The mechanics are different from a secured card. With a credit-builder card, the lender extends you a small credit line — often $300 to $1,000 — based on your income and banking history rather than a deposit. You use the card, and your on-time payments are reported to the bureaus. Some credit unions offer these cards to members only, so you may need to open a membership or savings account first.
The trade-off is that these cards often have lower credit limits and higher interest rates than secured cards (sometimes 20% to 29%). But if you do not have cash for a deposit, they are a real alternative. Self, for example, charges a $25 annual fee and reports to all three bureaus; LendingClub charges $0 annual fee but has stricter income requirements.
Check whether your credit union offers a credit-builder card before you look elsewhere. Credit unions typically charge lower fees and interest rates than online lenders, and membership is often free or costs only $5 to $25 per year.
Poor-credit cards from major issuers
Capital One, Discover, and a few other major card issuers offer cards marketed directly to people with poor credit. These cards have no deposit requirement and no membership fee, which makes them the fastest route to approval. The downside is that they charge annual fees ($39 to $99) and interest rates above 20%, sometimes reaching 29.99%.
Capital One's Platinum card and Discover's it Secured card are the most common examples. Both report to all three bureaus and have no annual fee (Capital One's does not; Discover's does not either). Interest rates start at 16.99% for Capital One and 16.99% for Discover, though your actual rate depends on your credit profile. Credit limits are typically $300 to $750 to start.
The advantage of these cards is speed: you can often get a decision within minutes of explore online. The disadvantage is that the combination of annual fees and high interest rates makes them expensive if you carry a balance. If you charge $500 and pay only the minimum, you will pay roughly $100 in interest and fees over a year. This is why these cards work best if you use them to build credit, not to borrow money.
How to use any of these cards to actually raise your score
Getting the card is the first step. Using it correctly is what raises your score. The formula is straightforward: charge a small amount each month (10% to 30% of your credit limit), then pay the full statement balance before the due date. Repeat for 6 to 12 months.
If you have a $500 limit, charge $25 to $150 per month. This shows the bureaus that you can manage credit responsibly. Paying in full means you avoid interest charges, which saves money and keeps your utilization low. Credit utilization — the percentage of your available credit that you are using — makes up 30% of your credit score. Keeping it below 30% signals that you are not desperate for credit.
Do not close the card after your score improves. Closing it reduces your available credit and can actually lower your score. Keep it open and use it occasionally. If you convert a secured card to a standard card, keep both open if possible (though you will get your deposit back, so the secured card becomes a regular card with no deposit).
Set up automatic payments if your bank and card issuer support it. This removes the risk of missing a due date, which is the single fastest way to damage your score. A 30-day late payment can drop your score 100 points or more.
Comparing the three types side by side
| Card Type | Deposit Required | Annual Fee | Interest Rate Range | Credit Limit Range | Time to Conversion |
|---|---|---|---|---|---|
| Secured Card | $200–$2,500 | $0–$95 | 18%–24% | Equals deposit | 6–18 months |
| Credit-Builder Card | None | $25–$99 | 20%–29% | $300–$1,000 | Not applicable |
| Poor-Credit Card | None | $39–$99 | 16.99%–29.99% | $300–$750 | Not applicable |
The choice depends on what you have available. If you have $500 in savings, a secured card is usually the cheapest option over time because the deposit is returned and annual fees are lower. If you do not have savings, a credit-builder card from a credit union is the next best choice. A poor-credit card from a major issuer is fastest to get but most expensive if you carry a balance.
What happens after your score improves
After 6 to 12 months of on-time payments, your score will likely move into the fair range (620–669) or higher. At that point, you have options. You can explore for a standard credit card with better terms, keep using your current card, or do both.
If you converted a secured card to a standard card, you now have a card with a longer history and a returned deposit. If you kept a credit-builder or poor-credit card, you have proof of responsible use that you can show to other lenders. Some card issuers will also increase your credit limit automatically after you demonstrate consistent payment.
Do not close your old card when you get a new one. Closing it shortens your average account age and reduces your total available credit, both of which lower your score. Keep the old card open and use it occasionally — charge something small every few months and pay it off. This keeps the account active and the history growing.
Frequently Asked Questions
How long does it take to see my credit score improve?
Most credit bureaus update scores monthly, so you should see movement within 30 to 45 days of your first on-time payment. Significant improvement (50+ points) typically takes 3 to 6 months of consistent on-time payments. The longer your payment history, the bigger the impact.
Can I get a credit card if I have no credit history at all?
Yes. Secured cards and credit-builder cards from credit unions are designed for people with no history or very poor history. You may also be able to become an authorized user on someone else's card, which adds their payment history to your report — but only if the primary cardholder has good credit and makes on-time payments.
What if I cannot afford the annual fee?
Some secured cards charge no annual fee (Discover Secured Card, for example). Credit unions often offer credit-builder cards with no fee or low fees ($25 or less). If cost is the barrier, start with a no-fee option rather than paying a fee you cannot afford.
Does explore for multiple cards at once hurt my score more than explore for one?
Yes. Each process triggers a hard inquiry, which lowers your score by a few points. Multiple inquiries in a short time signal to lenders that you are desperate for credit. Space applications at least 30 days apart, and limit yourself to one or two cards in your first year of rebuilding.
What if I miss a payment on one of these cards?
A missed payment will be reported to the credit bureaus and will significantly damage your score — typically 100+ points for a 30-day late. If you miss a payment, contact the card issuer when ready and ask about a hardship program or late fee waiver. Some issuers will work with you if you have a good reason and a short history of missed payments.