Guide: Finding The BEST Unsecured Credit Cards for Bad Credit with No Deposit
If you happen to have bad credit, it can be difficult to find ways to improve upon a lagging credit score.
What makes improving credit so frustrating is that simply having a poor credit score makes it harder to qualify for a new line of credit – yet having a new line of credit is often the only way to improve your overall score. If you aren’t actively trying to find new lines of credit, chances are that your credit score won’t improve.
This can be problematic, as the act of applying for new credit can actually harm your overall credit score. Hard credit inquiries stay active for 2 years and ultimately score negatively on your credit report.
Finding a new line of credit is an important part of improving your credit. Thankfully, unsecured credit cards for bad credit exist for this very purpose.
The best unsecured credit cards for bad credit will allow consumers with poor credit histories to easily access a line of credit in order to build their credit score back up.
Image: U.S. News & World Report
It can be difficult to identify which unsecured credit cards for bad credit are the best cards to get – particularly when you are concerned about hard credit inquiries causing further credit damage.
Our review will act as a thorough and detailed guide on how to find and get the best unsecured credit cards for bad credit.
First, we will answer the most common consumer questions about unsecured credit cards:
- What are unsecured credit cards for bad credit?
- What should I look for in unsecured cards for bad credit borrowers?
Finally, our review will provide a detailed overview of highlighted expert tips to help ensure that you can find the best unsecured credit cards for bad credit in order to build and maintain a positive credit history.
In detail, each of these tips provides expert assistance and guidance toward finding unsecured credit cards for bad credit.
Following our expert guide will not only help you find unsecured credit cards for bad credit with no deposit, but it will also prepare you to expertly identify the best unsecured credit cards for bad credit.
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What Are Unsecured Credit Cards for Bad Credit?
Unsecured credit cards are actually the most popular form of credit cards. They can be thought of as traditional or conventional credit cards. Unlike secured credit cards, bad credit unsecured credit cards don’t require an initial deposit for a line of credit. The lack of an initial deposit is the biggest difference between secured and bad credit unsecured credit cards.
Applying for unsecured credit cards for bad credit with no deposit is traditionally a difficult process for those with lowered credit since eligibility for these cards is based upon an individual’s overall credit score. Thankfully, unsecured credit cards for bad credit do exist and are gaining in popularity.
In contrast to traditional unsecured credit cards, unsecured cards for bad credit borrowers will have fewer restrictions on credit history and score. The tradeoff for access to a new line of credit is often centered on higher fees and higher interest rates.
Keeping this in mind, finding the best unsecured credit cards for bad credit often means being prepared to pay a little more in order to rebuild credit history, though there is certainly still a wide array of different options and choices.
A few common examples of unsecured credit cards for bad credit include the following:
As another common provider of unsecured credit cards for people with bad credit, Indigo offers a flat APR rate of 23.9%. Depending upon your credit report, the annual fee could fall anywhere between $0-$99. Unsecured credit cards for bad credit through Indigo may end up costing a little more, but an improved credit history may be well worth it.
Unsecured credit cards for bad credit through Milestone have annual fees that range between $35-$99, depending upon credit score. The good news, however, is that Milestone strives to provide unsecured credit cards for people with bad credit, meaning that chances of approval are relatively good.
Looking at the most popular options for unsecured credit cards for bad credit is a great introduction to learning how to identify the best unsecured credit cards for bad credit.
Not all unsecured credit cards have the same benefits, particularly where bad credit unsecured credit cards are concerned.
Before finding the best unsecured credit cards for bad credit, you’ll need to know what to look for.
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What Should I Look for in Unsecured Cards for Bad Credit Borrowers?
Image: NerdWallet
Even if your credit history is less than desirable, there are different options for bad credit unsecured credit cards. Understanding these can help you pinpoint the best unsecured credit cards for bad credit to positively impact your credit score.
When doing your search, keep these components in mind, as they will make for the best unsecured credit cards for bad credit:
Regular reporting to all three bureaus
In order totruly rebuild a credit score, the credit card company needs to regularly send out reports. When finding unsecured cards for bad credit borrowers, make sure that the company sends regular reports to all three bureaus: Equifax, Experian, and TransUnion.
With regular reporting, unsecured credit cards for people with bad credit will be efficient and thorough when improving credit scores. There is no sense in getting unsecured credit cards for bad credit and displaying good credit habits if those positive habits aren’t regularly reported.
Zero or low annual fees
Consumers looking for unsecured credit cards with bad credit will find that annual fees are common. While zero fees are ideal, the vast majority of unsecured credit cards for poor credit will have some form of annual fee attached.
If annual fees can’t be avoided, then it is crucial to make sure that you find the lowest fees possible. The average annual fee is $30, but some unsecured credit cards for bad credit may offer lower fees.
Closely related to annual fees are maintenance and processing fees. Look for unsecured credit cards for bad credit with no processing fee, as this will certainly save you money and keep your line of credit affordable.
Access to credit-building tools
Since unsecured credit cards for bad credit borrowers are specifically formulated to assist those with low credit, many bad credit unsecured credit cards also offer free access to various credit-building tools.
The best unsecured credit cards for bad credit will allow for free access to credit reports, debt-payment calculators, and various other financial education tools. Not only do these unsecured credit cards for bad credit offer ways to improve credit scores in the short term, but they also offer valuable tools for long-term credit maintenance.
No deposit requirements
The best characteristic of unsecured credit cards for poor credit is that they don’t require an initial deposit of funds or collateral. Unsecured credit cards for bad credit with no deposit are just that: lines of credit with no cash required up front. The best unsecured credit cards for bad credit are unsecured credit cards for bad credit with no deposit.
In fact, if unsecured credit cards for bad credit are advertised with a deposit, it means that they are actually secured and not unsecured. Unsecured credit cards for bad credit with no deposit will never ask the consumer to put money down first before establishing a line of credit.
With so many websites providing widespread access and information on unsecured credit cards for poor credit, make sure you are looking at unsecured credit cards for bad credit with no deposit. This is what separates from secured credit cards.
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How Can I Find and Get Bad Credit Unsecured Credit Cards?
Finding the best unsecured credit cards for bad credit involves utilizing a few easy, expert methods. Using these methods will help ensure that you find unsecured credit cards for bad credit with no security deposit. Our review highlights the top methods to yield positive results while looking for unsecured credit cards with bad credit.
Though it may take a little bit of extra effort, gaining the opportunity to rebuild and repair credit scores makes this effort well worth it. Following these expert tips can help put you on the right path to finding unsecured credit cards for bad credit with no deposit.
Always Know Your Credit Score
Image: U.S. News & World Report
Since unsecured credit cards for bad credit with no security deposit are directed primarily towards consumers with low credit scores, keeping track of your credit score makes perfect sense. Keeping a close eye on your credit score is important for each and every consumer, but particularly for those who are looking for unsecured credit cards with bad credit.
Knowing your credit score offers the following benefits:
- Planning for future improvements
Close and constant monitoring of your credit score can help pinpoint areas for immediate improvements, like forgotten or missed debts that can be quickly paid off. If there is an opportunity for even the slightest of improvements, finding unsecured credit cards for bad credit with no deposit will be much easier.
- Identifying and correcting errors or mistakes
Mistakes commonly stem from credit card fraud or from reporting errors. Finding and correcting these errors is crucial to improving credit, especially when looking for unsecured credit cards for bad credit with no deposit. Any mistake that is made from a previous or current debtor can typically be resolved within three weeks.
Get a Bank Account
Getting a bank account is a great stepping stone to use when looking for the best unsecured credit cards for bad credit. While bank activity won’t go directly onto your credit report, a local bank can be an important resource to use when finding unsecured credit cards for bad credit with no deposit required.
Think of a bank account as a starting point or a lead towards unsecured credit cards for bad credit with no processing fee. The account itself may not be a direct entrance for unsecured credit cards, but having a personal relationship with a bank might open up the opportunity.
With an established relationship and history of responsible account management, a bank may be more inclined to offer unsecured credit cards for people with bad credit. Oftentimes, unsecured credit cards offered through a local bank are best formatted for current accountholders, making a local bank account a worthwhile tool.
You may also want to consider opening a credit union account. Since credit unions are independently regulated, they usually offer lower fees and enhanced member services. They also provide lines of credit, making them a viable option for unsecured credit cards for bad credit with no security deposit. Additionally, when compared to national banks, credit unions are much more likely to offer more competitive credit card rates and terms.
If bank account doesn’t generate any leads towards unsecured credit cards for bad credit with no deposit, check with your local credit union. If you are eligible to become a member, ask if they offer unsecured credit cards for bad credit with no processing fee and no deposit.
Use Pre-Qualification Tools
Image: Discover
Although they are specifically geared towards low credit scores, applying for unsecured credit cards for bad credit with no deposit required can certainly be nerve-wracking. Hard inquiries damage overall credit scores, and it’s difficult to avoid these hard inquiries when opening a new line of credit.
Using pre-qualification tools means using soft inquiries to evaluate your overall chances of being accepted for unsecured credit cards for bad credit. These soft inquiries take minimal amounts of information to determine credit qualification, and they do not appear on your credit report. As an additional benefit, they provide a safe and stress-free method of finding the best unsecured credit cards for bad credit.
Creditcards.com has created a great method to assess pre-qualification through its CardMatch tool. Not only does it provide a list of potential unsecured credit cards for bad credit, but it also offers additional credit-building resources, like checking your credit report and score for free.
If you prefer to start at a specific bank, there are a few nationally recognized banks to use. Credit One, Indigo, and Milestone all offer soft inquiry pre-qualifications, making them great starting points for the best unsecured credit cards for bad credit.
Do Your Research
The most important method for getting the best unsecured credit cards for bad credit is doing your research. You will want to look through each and every aspect of unsecured credit cards for bad credit. This means understanding rates, terms, and any applicable fees. When looking for unsecured credit cards for bad credit with no deposit, it pays to shop around.
There are a few expert resources that can provide guidance when evaluating the best unsecured credit cards for bad credit. If your own research is stalled, looking at a few expert opinions can guide you towards unsecured credit cards for bad credit. Some of these expert resources are:
- Bankrate
With over four decades of experience, bankrate.com is one of the leading experts on financial issues. It conducts financial surveys across the nation to deliver the most accurate and unbiased facts across a wide array of financial products, including mortgages, checking and savings accounts, and unsecured credit cards for bad credit.
- NerdWallet
As an objective source for financial topics, NerdWallet strives to provide expert information and guidance for those looking to responsibly manage their finances. Over the past few years, NerdWallet has gathered tons of valuable information on unsecured credit cards for bad credit with no deposit required. For quick access to facts and figures, nerdwallet.com is a great online resource.
- Credit Karma
Making an account through Credit Karma is free, easy, and incredibly helpful. Not only does it offer expert advice and reviews through its Credit Advice Center, but it will also provide members with personalized suggestions for unsecured credit cards for bad credit.
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Conclusion
Image: Credit Information Center
Unsecured credit cards are crucial tools for those looking to build and improve their credit history.
They are a safe and effective means to obtain a new line of credit as they are specifically geared to provide unsecured credit cards for people with bad credit.
Unsecured credit cards for bad credit with no deposit not only make improved credit accessible, but they also make it affordable.
For many consumers, unsecured credit cards for bad credit borrowers are the only option to rebuild credit. Stretched over a long period of time, they can have incredibly positive effects upon credit scores, making them invaluable credit tools.
By keeping the key elements of the best unsecured credit cards for bad credit in mind and following our expert guidelines, anyone can find unsecured credit cards for bad credit.
Thankfully, with bad credit unsecured credit cards, a negative credit history does not need to result in a negative credit future.
Read More: Top Best Credit Cards to Build Credit | Ranking & Reviews
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