You can get a credit card with bad credit, but your options are narrower and the terms will be less favorable than cards for people with good credit
Banks and card issuers sort applicants by credit score. A low score — typically below 580 — signals that you have missed payments, carried high balances, or had accounts sent to collections in the past. Issuers respond by either rejecting you outright or offering you a card with a higher interest rate, a lower credit limit, and an annual fee. The card still works the same way, but it costs more to use.
Your realistic paths forward are a secured credit card, a credit-builder card, or a store card from a retailer that does not check your credit score as strictly. Each one has a different cost and a different timeline for rebuilding your score.
Key Takeaways
- Secured cards require a cash deposit that becomes your credit limit, and they report to the three major credit bureaus so on-time payments rebuild your score over months.
- Credit-builder cards charge a monthly fee but do not require a deposit, and some issuers approve people with scores below 500.
- Store cards often have looser credit checks but charge higher interest rates and only help your score if the store reports to the bureaus.
- Your credit score improves when you keep your balance low and pay on time every month — the card itself does not rebuild your score.
- Avoid cards that ask you to pay upfront fees before you are approved, because legitimate issuers do not charge before opening an account.
Secured cards: deposit your own money as collateral
A secured credit card works like this: you deposit cash into a savings account held by the card issuer, and that deposit becomes your credit limit. If you deposit $500, you get a $500 limit. You use the card like any other card, and the issuer reports your payments to Equifax, Experian, and TransUnion — the three credit bureaus that calculate your score.
The deposit stays in the account untouched. You are not spending it; you are using it as proof that you will not default. After 6 to 18 months of on-time payments, the issuer will usually convert the card to an unsecured card, return your deposit, and raise your limit based on your payment history.
Secured cards charge interest on balances you carry, just like regular cards. Interest rates typically range from 18% to 24%, depending on the issuer. Some charge an annual fee ($0 to $50), and some charge monthly fees if you do not meet a minimum deposit. Read the terms before you explore — the fee structure varies widely.
Issuers that offer secured cards include Capital One, Discover, and U.S. Bank. Each has different deposit minimums (usually $200 to $2,500) and different fee structures. Check the issuer's website directly to see current terms, because they change.
Credit-builder cards: monthly fees instead of a deposit
A credit-builder card charges you a monthly fee — typically $5 to $10 — but does not require a cash deposit. The issuer holds the money you pay in a savings account and reports your payments to the credit bureaus. After you have paid the monthly fee for 12 months, the issuer releases the money to you (minus the fees you paid), and you own the account history.
Credit-builder cards are useful if you do not have $500 or more to deposit upfront. They also tend to approve people with lower scores than secured cards do. The tradeoff is that you are paying a fee every month regardless of whether you use the card, and you do not get your money back until the full term ends.
Self and Chime offer credit-builder cards. Self charges $10 to $15 per month and reports to all three bureaus. Chime's version is free but only reports to one bureau, which means it rebuilds your score more slowly. Compare the terms on each issuer's website before you choose.
Store cards: easier approval, higher interest rates
Retail stores like Target, Walmart, and Best Buy issue their own credit cards and often approve people with lower scores because they are betting you will spend money in their stores. Store cards usually have higher interest rates than bank cards — sometimes 20% or higher — and a lower credit limit. Many store cards also charge annual fees.
The advantage is that approval is faster and the credit check is less strict. The disadvantage is that the card only works at that store, and you will pay more in interest if you carry a balance. Store cards also only help your score if the store reports to the credit bureaus; not all of them do. Before you explore, check the store's website or call customer service to confirm that the card reports to Equifax, Experian, and TransUnion.
What happens when you use the card: building your score month by month
Your credit score improves when you use the card and pay the bill on time. The bureaus track five things: payment history (35%), amounts owed (30%), length of credit history (15%), credit mix (10%), and new inquiries (10%). A new card helps most with payment history and credit mix.
Keep your balance below 30% of your limit. If your limit is $500, keep your balance under $150. This shows lenders that you are not desperate for credit and that you can manage what you borrow. Pay the full statement balance by the due date every month — even a single late payment will damage a low score more than it damages a high one.
Your score will not jump overnight. Most people see a 50 to 100 point increase within 6 months of on-time payments, and another 50 to 100 points within a year. The exact timeline depends on how low your score started and what else is on your credit report.
Red flags: what to avoid
Do not explore for a card that asks you to pay a fee before you are approved. Legitimate issuers charge fees after the account opens, not before. If a company asks for money upfront to "may provide" approval or to "check your may be able to access," it is a scam.
Do not explore for multiple cards in a short time. Each process creates a hard inquiry on your credit report, and multiple inquiries in a few weeks can lower your score by 5 to 10 points. Space applications out by at least 3 months.
Do not close the card after your score improves. Closing an account shortens your average account age and lowers your available credit, both of which hurt your score. Keep the card open and use it occasionally, even after you move to a better card.
Next steps after you get the card
Once your card arrives, set up automatic payments for at least the minimum due. This removes the risk of forgetting a payment. Better yet, set up automatic payments for the full statement balance so you never carry interest.
Check your credit report 30 days after your first payment posts. You can get a free report from each bureau once per year at annualcreditreport.com. Look for errors — wrong accounts, wrong balances, or payments marked late when you paid on time. If you find an error, dispute it with the bureau in writing.
After 6 to 12 months of on-time payments, contact the issuer and ask whether the card can be converted to an unsecured card or whether your limit can be raised. Some issuers do this automatically; others wait for you to ask. A higher limit and lower interest rate mean you are rebuilding faster.
Frequently Asked Questions
Will explore for a credit card hurt my score?
Yes, but only slightly and only temporarily. Each process creates a hard inquiry that lowers your score by a few points. The impact fades after 3 to 6 months. Multiple applications in a short time do more damage, so space them out by at least 3 months.
What credit score do I need to get approved?
Secured cards typically approve people with scores of 500 and above. Credit-builder cards approve people with scores below 500. Store cards vary by retailer but often approve scores in the 550 to 650 range. Check the issuer's website for their minimum, because it changes.
Can I use a secured card at any store?
Yes. A secured card works like a regular Visa or Mastercard at any store that accepts that brand. The "secured" part is only between you and the issuer — the store does not know or care that you put down a deposit.
How long does it take to rebuild my credit?
Most people see meaningful improvement within 6 to 12 months of on-time payments. Larger improvements take 2 to 3 years. The timeline depends on how damaged your credit is and what else is on your report — recent collections or charge-offs take longer to recover from than old ones.
What if I am denied for a secured card?
Try a credit-builder card instead, which approves lower scores. If you are denied for both, wait 3 to 6 months and try again. Your score may have improved, or you may have resolved old accounts. You can also ask a family member to add you as an authorized user on their card, which may help your score without requiring a new process.