Can You Get a Credit Card When You Don’t Have a Job?
Key points about: Getting a credit card without a job
You can get a credit card when you’re unemployed
Credit card companies consider other income sources besides employment
A secured credit card may be a good option for someone with little or no credit history
Credit cards offer a convenient way to make payments, plus the possibility of earning rewards. If you don’t have a job, you may wonder whether you will be able to qualify for a credit card. The answer is yes, as long as you have the required income or assets.
How to get a credit card if you have no job
Government regulations require credit card issuers to verify your ability to pay credit card debt before issuing a card. Your ability to pay is more important to credit card companies than whether you’re employed, unemployed, sharing household income, or retired.
Show income when you apply
To qualify for a credit card, you must demonstrate income. The following are examples of income that credit card issuers will consider:
- Income from employment (wages, salary or tips)
- Money that is regularly deposited into your account by someone else, if you are under 21
- Bonus pay
- Income from rental property, interest, dividends and retirement benefits paid
- Unemployment benefits
- Certain student grants
- Another person’s income that is available to you, if you’re 21 or older
Note that student loans are not considered income when applying for a credit card.
Will being unemployed limit the credit cards you can get?
If your income is lower than usual because you’re unemployed, certain credit cards may not approve you, but others may. If you have enough income from other sources, unemployment won’t limit the cards you can apply for.
However, if being unemployed has caused you to make late payments, which may have impacted your credit score, this may limit the cards you can be approved for. With Discover, you can check to see if you are pre-approved without affecting your credit.
Credit cards to consider when you don’t have a job
Some types of cards may be easier to qualify for if you’ve lost income because you’re unemployed, or if your credit has suffered because of difficulty paying bills on time.
Secured credit cards
Secured credit cards are a great option for someone with limited or no credit history. To open a secured card, you must deposit money with the credit card company. This security deposit reduces the company’s risk, and the deposit amount required is usually the same as your credit limit.
You can use a secured credit card just like any credit card to make purchases. However, if you fail to make your payments or close your account with a balance, the company will apply the deposit toward your outstanding balance.
Note that secured credit cards are not the same as prepaid debit cards. Generally, prepaid and debit cards do not report to the three major credit bureaus.
After you’ve used a secured card responsibly for a period of time, you may be able to have your credit line transferred to an unsecured credit card and continue to build your credit history1. The Discover it Secured Card, for example, after seven months begins automatic monthly account reviews to see if you are eligible to upgrade to an “unsecured” card, get your deposit back and if you qualify, increase your credit line.2
Becoming an authorized user
If you can’t or don’t want to get a credit card in your name, you can ask a friend or family member to add you as an authorized user on their card. In this case, you won’t need to submit income information or be approved, because the owner of the account is responsible for paying the bills.
Using credit responsibly during unemployment helps you apply once you get a job
If you lost your job and your income is lower, it can be tempting to run up balances and skip credit card payments, but you should try to make at least the minimum payment due.
Missed payments and using a large percentage of your available credit may impact your credit score. A low credit score may make it harder to get a new credit card, even after you have income from a new job.
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