Getting pre-qualified for a credit card can make it easier to get approved if you have bad credit or a limited credit history. That said, it's important to note pre-approval doesn't guarantee acceptance. With that in mind, we've listed the best pre-qualified credit cards as well as alternative options and advice.
Most card issuers offer at least one card for people with less-than-perfect credit. By seeing if you pre-qualify, you can get a good idea of what kind of card you should apply for based on your credit history.
Also: The best starter credit cards for no credit
Still, there are many different credit cards geared specifically toward people with bad credit. While some cards for people with bad credit come with fees and higher interest rates, they can help you improve your credit -- provided you use them responsibly.
Here are a couple suggestions:
Whether your credit is fair or poor, moving the needle upward should be at the top of your agenda. If you can't qualify for a credit card or are scared to try because your score is so low, use these four strategies to boost your credit score fast:
While unsecured credit cards extend an actual line of credit, secured credit cards require a cash deposit you can borrow against. Because you must put down a cash deposit that is normally equal to your credit limit, secured cards are fairly easy to qualify for -- the bank has little to lose if you default since they'll just keep your deposit.
Since secured credit cards report your credit activity to the three major credit reporting agencies -- Experian, TransUnion, and Equifax -- using a secured credit card responsibly can help you improve your credit score month by month and most issuers will eventually let you "graduate" to a regular card. Plenty of security deposits are refundable after meeting certain criteria, too.
Good choices:
If you haven't checked your credit report recently, you'll want to do that right away. An error on your credit report can wreak havoc on your score without you even knowing. Fortunately, you can get a free copy of your actual credit report from all three credit reporting agencies for free once per year from AnnualCreditReport.com.
Once you've scoured your credit report for details, you should make cleaning up any problems a priority. If you have debts in collections or default, you should focus on repaying those debts right away. In the meantime, make sure to keep all of your bills current as well.
Most lenders rely on the FICO credit scoring method, in which your payment history makes up 35% of your score. If you want to make a big impact on your credit score, one of the best things to do is to pay all of your bills on time, every time. Never pay late, and you'll never ding your score for late payments or pay late fees.
While paying your bills religiously is the best way to improve your credit score over the course of months or years, the second biggest factor influencing your credit score is the amount of debt you carry relative to your credit limit. If you have a maxed-out credit card (or any line of credit where you're using more than 20% to 30% of the available credit), paying down that balance will improve your credit score almost instantaneously.
[This article was first published on The Simple Dollar in 2020. It was updated in March 2022.]