If you’re struggling with less-than-stellar credit, you’re not alone. In fact, surveys show that 68% of Americans are in the same boat—and all before they turn 30.

Even just one poor financial decision can leave a lasting mark on your credit score. That can make qualifying for credit cards a challenge. But it’s not impossible.

Bad credit credit cards do exist. Here’s a look and what you need to know to help you find the best one for your financial situation.

What is Credit?

We hear the words credit and credit score nearly everywhere. But exactly what are they and why are they important?

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Credit is an umbrella term in the world of finance. It’s often the word that we use to describe an agreement between a lender and a borrower. The borrower agrees to pay back a certain amount of money by the date the lender sets.

But credit is also attached to a person’s credit history. This includes information about:

• The number of open and closed accounts in your name
• The type of accounts you hold
• How much you owe on each account
• Whether you have a history of on-time payment

If you have a solid credit history that ups your creditworthiness. And that makes you more attractive as a borrower to lenders.

What Factors Impact Credit Score?

All of this information about your credit history and creditworthiness is summed up in number: your credit score. Everyone falls somewhere on the spectrum between 300 to 850. As of April 2018, the average credit score in the U.S. is 704.

Here’s a breakdown of what the FICO score ranges signify.

• Poor credit: 300-579
• Fair credit: 580-669
• Good credit: 670-739
• Very good credit: 740-799
• Excellent credit: 800-850

There are a few important credit score factors to keep in mind to help you raise your rating.

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Payment history and the total amount you owe are the most significant elements. If you pay on time, that helps build your reliability as a borrower.

And if you keep the amount that you owe on a credit card low, you’re establishing low credit utilization. That’s a good thing. That shows lenders you’re using a small amount of your credit line and you’re more likely to pay it back on time.

Other deciding factors include the kind of credit you have, whether that’s credit cards or installment loans, and the length of your credit history. If you have a longer history, you’re generally considered less of a risk to a lender.

Unsecured vs. Secured Credit Cards

Before you begin searching for credit cards for poor credit, make sure you know the difference between these two types: unsecured and secured.

An unsecured credit card is probably the credit card you’re already most familiar with. There’s a line of credit with a certain limit and you’re required to pay a minimum amount each month.

Secured credit cards, on the other hand, demand that you put a security deposit down. This is required to open the credit card account and is usually the same or less than the credit limit.

Unsecured credit cards usually require at least a fair credit score in order to qualify. Secured credit cards are much more lenient to those struggling with credit issues, which tends to make them better credit cards for bad credit.

Bad Credit Credit Cards Considerations

If you want to apply for a credit card but you don’t fall within the fair to good credit score range, don’t fret. There are credit cards for people with bad credit.

But just like any other credit card search, you’ll want to consider a few other factors to help you with your search and decision.

For example, do you want a card with rewards, points, and cash-back benefits? You may be able to find these kinds of benefits in secured options, but not necessarily across the board.

What kind of interest rate are you looking for? Many secured credit cards have higher interest rates than unsecured options.

Are you okay with paying an annual fee or do you want to avoid it? You can find cards that waive the fee.

Bad Credit Credit Cards to Consider

Once you have your priorities laid out, here are a few bad credit credit cards to explore.

Capital One Secured Mastercard

This secured credit card does not require an annual fee. There are no cashback, miles, or points of any kind, but this is a very friendly option for people with poor credit.

The initial credit line is $200 with a minimum security deposit of $49 from your checking or savings account. If you pay on time for the first five months, you may be eligible for a higher credit line with no additional deposit.

Discover it Secured

Like the Capital One Secured Mastercard, this option does not require an annual fee. It does demand a security deposit between $200-$2,500, which is refundable after you’re approved. And if you do well for eight months, you may be eligible to transition to an unsecured credit card.

This card comes with an attractive awards system that rivals some unsecured credit cards. Each quarter cardholders receive 2% cashback on up to $1,000 spent at restaurants and on gas. You also receive 1% cashback on all other kinds of purchases.

OpenSky Secured Visa Credit Card

A big bonus of this card is that it doesn’t require a credit check, which makes it a great option for people with very bad credit. You don’t need a bank account either to make your initial deposit, but there is a $35 annual fee.

DCU Visa Platinum Secured Credit Card

A big draw of this credit card is the low 13.75% variable APR. This is significantly lower than most unsecured credit cards out there. There’s no annual fee either.

There is also no limit to your initial security deposit amount or your credit limit. While this may all sound great, there is one catch: you have to be a member of the Digital Federal Credit Union first.

Credit One Bank Platinum Visa

If you have poor to fair credit and you really want an opportunity to build your score, this may be a good option. It offers 1% cashback on every purchase. You can also see if you pre-qualify without impacting your current credit score.

Learn More About the Best Credit Cards for Bad Credit

Interested in learning more about bad credit credit cards or tips for smart credit card use? You can find plenty of resources on our blog. If you have any other personal financing questions, feel free to ask us.