Credit cards have become essential in our modern life. When someone talks about credit cards, he/she is mostly concerned about unsecured credit cards. That means you don't have to worry about the approval of cash deposits.
Unsecured credit cards are common and easily available. But individuals without perfect credit history or bad credit history find it hard to get an unsecured credit card. Opposite to secured credit cards, unsecured credit cards are much more likely to improve your credit limit and credit history and solve many difficulties.
This post will uncover the best-unsecured credit cards for bad credit and everything you need to know about them. First, we'll see what an unsecured credit card means?
Mostly, the credit cards available in the market are unsecured. Unsecured credit cards are normal credit cards with the eligibility to make purchases at stores, stretching out the payments according to schedule or monthly. An unsecured credit card allows you to increase your credit limit and make monthly payments. You don't need a cash deposit to qualify for an unsecured credit card.
On the other hand, you should have a cash deposit in a locked account managed by a credit card company for a secured credit card. Also, the deposit amount should be lower or equivalent to your credit limit, depending on your card type and credit score. The cash deposit of your secured credit card will remain in the issuer's account for as long as you manage to keep your credit card account open. But If you close your account, you will lose all the money you have in the account.
There are many advantages of an unsecured credit card. One of the biggest advantages of an unsecured credit card is the availability of options. You can choose travel rewards cards, student cards, cashback cards, etc.
It is challenging to make yourself eligible for an unsecured credit card because the chances of not paying the bills on time are higher. After all, you don't need a cash deposit for an unsecured credit card. An unsecured credit card will enable you to achieve your goal of spending your credit amount.
Here are a few pros/advantages of an unsecured credit card:
You don't need a cash deposit for an unsecured credit card. The more your credit is worthy of charge, the more your credit limits will increase.
An unsecured credit card allows you to make purchases without interest. You can avail the option of an O per cent APR period. You can enjoy an introductory time before becoming a regular APR customer.
You can have the best introductory options, such as earning bonuses, cashback, and score points.
One of the best advantages of an unsecured credit card is that you deal with a low fee for foreign transactions or no annual fees.
Alongside benefits, there are also some disadvantages of an unsecured credit card. Let's have a look at them.
You need a good credit card and credit history to qualify for an unsecured credit card. An unsecured credit card requires you to make your credit card and credit history good enough to get great benefits.
Cash deposits do not secure unsecured credit cards, so lenders find it difficult to qualify. Also, cardholders are at high risk of spending more power. You have to manage your credit limits to avoid an increase in interest. And to do this, you have to make the means of paying your full bills at the end of the month, whether you have a credit limit of thousands of dollars or a few hundred. If you can't make this happen, you'll be in a difficult situation.
It's challenging to get an unsecured credit card if you have a bad credit history. You have to pay heed to the beneficial options for your long credit usage journey because all credit cards don't have solutions for all problems. Following are some types of consumers who are eligible for unsecured credit cards:
If you are budget conscious and think before spending, you are more likely to have a strong credit history. You are also at a high risk of making any small mistake that can lead you to a big disaster. In this situation, an unsecured credit card can be a helpful and effective option for getting cashback on daily purchases.
The difficulty of spending the massive bill of family groceries or other related expenditures once or twice a month can be reduced by an unsecured credit card because it provides the opportunity to manage the interest rate on specific areas you find difficulty spending in, like dining, grocery items, and entertainment purposes.
Business credit cards help provide companies with the benefits of daily base spending. Freelancers can track their expenses and can get benefits from rewards programs. If you are not a company owner and own a small business, you can qualify for unsecured credit cards.
Business credit cards provide various options and opportunities like getting a low-interest rate with great rewards, bonuses in the introductory period, no fee for foreign transactions, and no annual fees. All these benefits depend on the card you have. But a great variety of cards are also available for people on the startup level and the rich individuals who want to enjoy life at its full by going on luxurious travel trips.
For all the cards, including business credit cards and travel rewards cards, you need to have or increase your credit score from good to excellent.
A travel rewards credit card is a great option for people who travel for business purposes or roam around the globe for entertainment. It will help you manage your travelling expenses and increase your travel adventures. A travel rewards credit card demands an annual payment. Still, it offers bonuses on new signups and luxurious rewards like access to the airport lounge.
Suppose you have a 670 or below credit score in your account. In that case, it will be challenging for you to qualify for a travel rewards credit card because it requires a credit score to range from good to excellent.
We move on to the best unsecured cards for bad credit and discuss them.
You have to go through a prequalification process to get an unsecured credit card that is not harmful to your credit score. With the lowest credit score, you can still avail at least one unsecured credit card from the credit cards given below. It will enable you to make purchases without a chequebook, a debit card or cash.
The Surge Mastercard® is one of the most reliable unsecured credit cards for bad credits. It provides you with all the benefits offered by other Mastercards. When you first sign up for the card, the credit limit will be low, but you can increase the credit limit by paying bills regularly for six months. You can make online payments, view your balances and manage your card online on the website or with a mobile application.
With this unsecured credit card, you can buy credit protection so that it can increase the level of your credit card gradually in case you meet with your death. You can also get credit protection after losing a job, disability and time in hospitalization.
By using Reflex Mastercard, you can pass the prequalification test without affecting the bad credit score. It offers a competitive wide credit limit range. You have to pay an annual fee for getting this unsecured credit card, but it has a $0 fraud liability.
Reflex Mastercard starts initially with a low credit limit. Still, as you'll start paying minimum payouts regularly for six months, your credit limit will increase. Reflex Mastercard requires you to pay a maintenance fee (compulsory to pay for the first year), cash advances, returned payments, late payments, and a foreign transaction fee. You can avoid the maintenance fee each month by managing your credit score.
The Reflex Mastercard has a regular APR range from 24.99% to 29,99%. You can be eligible for this unsecured credit card with a bad, fair, or no credit score.
Revvi Card is one of the unsecured credit cards that provides cashback rewards options. It offers $0 fraud liability. You can manage and balance your credit details and credit history on its mobile application online. It keeps track of your credit details, sends a monthly report to the credit bureaus and helps you build and maintain your credit score.
Revvi Card has an APR of 34.99%, a high purchase compared to other unsecured credit cards. It provides $0 fraud liability, an annual fee of $75 for the first year and $48 for the rest of the time, a program fee, fees for foreign transactions, returned payments, late payments and fees for cash advances.
Fit Mastercard sends a report of all your transactions to all the credit bureaus, so you can use this unsecured credit card to shape your credit in a better way. You have to pay an initial processing fee for the first time and avoid the monthly maintenance fee because Fit Mastercard gives you relief for the first 12 months. The card charges fees for cash advances, foreign transactions, late and returned payments, fees for additional cards, and an annual fee.
It offers $0 fraud liability for its cardholders. It has provided you with options to increase the credit limit by regularly paying the minimum payments for the first six months. It also offers credit protection for disability, life or job loss, or expenses during hospitalization. Its purchase APR is 29.99%, and it runs on bad, poor and fair credits.
The Total Visa® Card has a high APR with a short grace period of 21 days only. It provides a fast and easy application process, and you can have quick responses on your choirs. You have to pay the program fee for the first time, and it can also be deducted from your credit limit.
It also demands a monthly service fee for the first year, a late and returned fee, an annual fee, and a cash advance fee. All these fees are essential because the initial credit limit of the card is low, so you have to manage monthly minimum payments.
The First Access Visa Card is an all-around, user-friendly, unsecured credit card for bad credit. It provides its imperfect credit holders with daily accessibility and on-time response. When applying for this unsecured credit card, you can choose from the six card designs.
You have to pay plenty of fees, such as initial program fees, late or returned fees, fees for monthly service and fees for cash advances for the first year only. The purchase APR of this card is high. You have to pay the fee for additional cards, increase the credit limit, express delivery fee, and fee for copies of the billing statement.
The card with the name 'Indigo Unsecured Mastercard-Prior Bankruptcy is Okay' is a user friendly and calm credit card. It doesn't pay heed to the perfect credit history. It would approve your application even if you were involved in a bankruptcy situation. It offers you to prequalify without affecting your credit limit. You can build your credit score high as they report your credit activities to the major credit bureaus.
The progress Credit Unsecured credit card has a partnership with two issuers. They provide you with an unsecured Visa Credit card and a secured Mastercard with your bad credit history. It's easier to get an unsecured credit card than a secured one. The unsecured Visa Card issued by the Bank of Missouri spread nationwide in the United Nations and provided security protections.
Both unsecured and secure credit cards are important for your credit history. They report your credit activities individually to the major credit bureaus. Once your application is approved, you must pay for an initial program. The card cannot be used for transactions or gambling, at fuel stations, and with foreign merchants. This card is good for bad, fair and no credits.
The Merrick Bank Double, Your Line® Mastercard, enables you to manage and pay your bills on time. You can increase your credit limit after paying seven regular payments with this card.
Its purchase APR is 19.70% to 29.95% which is comparatively high. You don't have to pay annual fees for this card, but it depends on your credit history. This card will enable you to have access to your monthly FICO score.
An unsecured credit card lets you know about your qualification for getting, handling and making payments with the help of your credit score. The type of unsecured credit card you can get is dependent on the strength of your credit score. The range of 580 to 669 is the fair to the good range that can provide you with some cards. But if your credit score is below 580, your card choices will be limited. Although you can still find cards with a low range, you'll be charged more fees, and the chances of getting rewards cards will not be more. There is a credit range of 670 to 850, which is called the good to excellent range; if you have a 670 or more credit score, you are eligible for getting rewards cards.
If your account has a low credit score and you have applied for a credit card, there are many chances that you can be qualified to get an unsecured credit card.
Unsecured credit cards have more benefits than disadvantages, but people focus more on the cons, which are only two. The advantages of an unsecured credit card, you can get freedom from cash deposits; you can get great products with multiple benefits and rewards that seem appealing to anyone.
If you have recently started playing the credit card game and are a new player, your journey is not finished yet. You can strengthen your credit score with a secured credit card to understand your future goals better. Once you stick to your goals and habits, you will soon qualify for an unsecured credit card.