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Good Credit Cards for People with “Bad” Credit

Last Updated: October 1, 2023
2 min read

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Key points about: finding a credit card if you have poor credit

  1. Secured credit cards may be an option for borrowers who don’t qualify for traditional, unsecured credit cards due to unestablished or poor credit.

  2. Secured credit cards require a security deposit equal to the approved credit limit.

  3. A secured credit card can help you build your credit with responsible use.

You might be facing an uphill battle getting a credit card if you have less than stellar credit or haven’t established a credit history. Fortunately, there are ways to get a good credit card, even with poor credit.
Secured credit cards cater to borrowers building or rebuilding credit history. While not everyone may qualify for a secured card, credit score requirements are usually less strict for secured vs. unsecured credit cards, which means a poor credit score may not stop you from getting approved. At Discover®, there’s no credit score required to apply.1 Let’s learn more about getting a secured card and building credit history from the ground up. 

How does a secured credit card work?

Secured credit cards differ from unsecured cards because they require a cash deposit that is used as collateral. This security deposit is what allows a credit card company to relax its credit score requirements. The credit limit for a secured card is set by the credit card issuer and is usually equal to the deposit amount.

After you make a series of on-time payments to your secured card, you may be eligible to get your deposit back. In addition, many credit card issuers will report your account activity to the three major credit bureaus. So paying at least the minimum payment on time on your balance each month can also help you build your credit with responsible use.

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When can you graduate from a secured to an unsecured credit card?

It’s important to remember that a poor credit history doesn’t necessarily mean a poor credit future. Secured credit cards let you demonstrate responsible credit management, such as making timely payments and maintaining a low credit utilization (the amount of credit you’re using compared to your total available credit).

Did you know?

As you build or rebuild your credit history using a secured credit card, you may qualify to transition to an unsecured card. With the Discover it® Secured Card, you can upgrade to an unsecured card after 6 consecutive on-time payments and maintaining good status on all your credit accounts.2 Keep in mind that if you graduate from a secured card, your account number, benefits, and rewards often remain the same.

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What should you look for in a secured credit card?

Many secured credit cards come with a higher interest rate and lower credit limit than unsecured cards. But you can still make the most of your card. Consider secured cards that offer rewards for eligible purchases. And look for secured credit cards with no annual fee. Discover has no annual fee on any of our cards. You may also want to double-check that the credit card company you choose does, in fact, report payment history to the three major credit bureaus. Otherwise, your responsible credit use may not help with rebuilding your credit history.

It may seem daunting, but finding good credit cards with a poor credit history is possible with secured credit cards. As you narrow your search, be sure to review each card’s terms and conditions to find the best credit card for you.


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