Credit Cards For 500 Score

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Written by: Ben Luthi

When your credit history needs some work, getting a decent credit card isnt easy.

But just because youre building or rebuilding credit, it doesnt mean you have to settle for a bad card with steep fees. Here are some standout alternatives.

Pay All Your Bills On Time From Now On

Whether youre about to apply for a credit card, or you just got a brand new one, resolve to pay all your bills on time from now on.

That applies not just to your credit card, but to all obligations. Though landlords and utility companies dont report your good payment history to the credit bureaus, they will report delinquencies. This is particularly true of unpaid balances.

Make sure that doesnt happen. Unpaid balances, like collections and judgments, will drive your credit score even lower.

Can A 500 Credit Score Get An Amex Card

The answer is yes, but it isnt going to be easy. American Express has some of the best credit cards on the market, but they also have some of the strictest requirements. If you have a 500 credit score, youre going to need to jump through a few hoops to get approved.

First things first, youll need to make sure that your 500 credit score is actually accurate. Check your credit report for any errors or inaccuracies and dispute them if necessary. Once youre confident that your credit score is accurate, you can start shopping around for an Amex card.

There are a few Amex cards that could be a good fit for someone with a 500 credit score. The Blue Cash Everyday® Card from American Express is a great option for people who want to earn cash back on their everyday purchases. The card comes with no annual fee and offers a 0% intro APR on purchases and balance transfers for 15 months.

If youre looking for a travel rewards card, the Starwood Preferred Guest® Credit Card from American Express could be a good option. The card comes with an annual fee of $95, but its waived the first year. You can also earn up to 25,000 bonus points after you spend $3000 on purchases in the first three months.

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Surge Mastercard Credit Card

The Surge Mastercard® Credit Card offers a high maximum credit limit of $750, but this depends on your creditworthiness. This high credit limit comes at a high price, however. This card is rather expensive, with an annual fee that ranges from $75 to $99. The monthly fee of $10 starts in the second year, but you may be eligible to waive the fee if you get approved for a $750 credit limit. This credit card also allows you to get pre-approved. Although this doesnt guarantee approval, it will allow you to get a good idea without making a negative impact on your credit score. Additionally, before you can open this card, you must prove that you have a checking account.

The Grace Period of 25 Days Will Help You Keep Interest Down

Other expenses that you will have to keep in mind with this credit card include the variable interest rate of 25.99% to 29.99%. This is a high interest rate that will require you to make purchases responsibly if you need to keep an eye on your spending. But, the Surge Mastercard® Credit Card will offer you a grace period of 25 days, which gives you a bit of leeway to make your payments before this high interest rate is applied.

Pay Off Your Balance Quickly And Regularly

There are three basic problems with carrying a balance:

• Balances incur interest, and that raises the cost of having the card.
• Carrying a balance further reduces an already low credit limit.
• Carrying a balance increases the chance of you defaulting on your debt.

All three of those complications can be avoided by living within your means, not overspending, and paying off your balance in full every month.

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How To Prequalify For Credit Cards With Bad Credit

If an issuer offers prequalification for one or more of its credit cards, itll typically show it on its website. To see if you prequalify, youll be asked to enter a few details about yourself. Youll usually need to provide your name, address and the last four digits of your Social Security number so the issuer can run whats known as a soft check of your credit.

This type of credit check, unlike a hard pull of your credit, wont have any impact on your score. Running a soft check doesnt mean youre officially starting the application process either, but it does allow an issuer to get an idea of what among its offerings you may or may not qualify for.

Overall, theres no downside to having an issuer prequalify your application. In fact, you may end up finding out you have a shot at a card you didnt think your current credit score merited. Prequalifying is not a guarantee of approval.

An important note: be sure you have complete trust in any website or service asking for sensitive information for prequalification . Be wary of initiating this process through links provided by online or email advertisements and through unsolicited phone calls, as the entity on the other end may not actually represent who they claim to. You can always decline, note information and follow up yourself through the credit card issuers official channels. Claims that this is your only opportunity to act on an offer should raise red flags.

Credit Score Home Loans

Similar to personal loans, it can be difficult to get a home loan with a very low credit score. Finding 500 could be even more difficult since a home loan is one of the longest possible liabilities a person can avail of, with most home loans coming with a tenure of 20-25 years.

With mortgage insurance mandatory when you take a loan in the UAE, most mortgage and home loans are adequately protected by mortgage insurance plans. Additionally, most banks provide home loans only after carefully evaluating the collateral i.e., the property for which the loan is meant. The implication of all these factors is that given the additional security that home loans enjoy, the importance of other factors like the applicants credibility and credit score is reduced.

At the same time, it is important to remember that while you may not face any difficulty in getting your home loan approved even with a low credit score, applying for one may prove troublesome if you fail to meet the minimum eligibility criteria. While most banks do not keep credit score a qualifying factor in the list of eligibility criteria, applicants are generally expected to have at least medium or low credit scores. And, as one might remember, the category of low and medium credit score begins from 541 and goes up to 710.

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Opensky Secured Visa Credit Card

Our pick for: No credit check or no bank account

The OpenSky® Secured Visa® Credit Card charges an annual fee, but a lot of people will still want to take a look at it for two reasons. First, there’s no credit check required. Second, you don’t need a traditional bank account you can fund the deposit or pay your bill with a money order or Western Union payment. Read our review.

Chime Credit Builder Visa Credit Card

Our pick for: No credit check and easy account management

This card has no minimum deposit requirement, charges neither an annual fee nor interest, and doesn’t require a credit check, and you can automate your payments so you’re never late. But to get it, you must be a Chime banking customer, which is an extra hoop to jump through and which comes with its own considerations when it comes to customer service. Read our review.

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What Is A No Annual Fee Credit Card

A no-annual fee credit card means you wont have to pay a monthly or annual fee to use the card and keep your account open.

Compared to premium cards with fees as high as $699 per year, no-fee credit cards have a $0 annual fee.

That said, we should note that a no-fee credit card does not mean you wont pay any fees.

Interest fees will still apply to balances you carry beyond the 21-day grace period. Other fees may also be charged, including:

• Cash advance fees
• Foreign currency transaction fees

Put Small Charges On Your Card

No matter what type of card you get, this is probably the single most important practice. Be sure any charges you incur can be easily repaid when the credit card bill comes in next month. Those should be small, routine charges.

A $10 charge here, and a $20 charge there and no more than one or two per month will enable you to improve your credit through small monthly payments. But at the same time, it wont put you into a position where youll have a balance you cant pay off completely.

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Consider Your Credit History

If you already know youve had some major financial misstepsa bankruptcy, a loan default, a rocky history with credit card usea credit card marketed to consumers with bad credit will likely be your most realistic option. Because of card issuers risk management practices, the most generous credit card plans are mainly accessible to borrowers with solid, developed credit histories. As with a credit score, a good credit history indicates creditworthiness, or trustworthiness with borrowing money, to the lender. If youre unsure where your credit profile stands, you can get a free credit report once a year from each of the three major credit reporting agencies at annualcreditreport.com.

Best For Secured Card With A Low Deposit

The Capital One Platinum Secured Credit Card is worth considering if you can only put down a small amount for the security deposit. If you qualify for the low $49 or $99 deposits, you’ll still receive a $200 credit limit.

The card is also good for travelers since there are no foreign transaction fees, meaning you will not incur any fees for using the card to pay for your expenses while you’re traveling outside of the United States. The card also has no annual fee and features automatic reviews to increase your credit line that can start as soon as six months into your card membership.

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Can You Do A Balance Transfer With Bad Credit+

Its technically possible to do a balance transfer with bad credit, but its probably not practical. The only cards youre likely to qualify for that allow balance transfers are secured cards, and it usually makes more sense to tackle paying down your balance and building your credit for a bit until youre eligible for better balance transfer cards.

How Do You Improve A Low Credit Score

The best way to increase a credit score of 500 or below will depend primarily on how you got a low score in the first place. For instance, if your low credit score is due to having a thin credit profile, then simply building up a positive credit history over time should help your credit score increase.

If, however, your poor credit score is due to some financial mistakes, youll need to analyze your credit reports and build a plan. Make sure you check all three of your credit reports to get a complete picture of your credit history.

You can do this for free at AnnualCreditReport.com.

Having cards with high utilization rates the ratio of how much credit you are using over how much you have available will also drop your score, especially if you have credit cards that are maxed out. Paying down these balances can do a lot to boost your credit score.

Of course, your payment history is the largest factor in your score, meaning things like delinquent payments or defaulted accounts can really hurt your credit scores. While payments that are a day or two late wont cause your score to decrease, anything that is 60 days or more past due will be reported to the credit bureaus as delinquent.

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Bankrates Take: Is The Petal One Visa Card Worth It

The Petal 1 No Annual Fee Visa Credit Card is a decent low-cost choice if youre dead set on an unsecured card and your credit score doesnt reflect the best financial habits yet. However, the Petal 2 Card is the superior no annual fee card, if youre eligible.

You also have a few better options if you qualify for a student credit card, or if you can afford a deposit for a secured card. Most student cards have no annual fee and may include more cash back opportunities.

Why We Like This Card

The Capital One Platinum Secured Credit Card offers a low barrier to entry as far as secured cards go. Its required security deposit ranges from $49 to $200. Comparatively, many secured cards require a deposit of at least $300 or more. Cardholders could get a credit limit up to $1,000 if theyre willing to put down more funds. But the real appeal here, perhaps, is that Capital One will consider granting you a higher line of credit if you demonstrate responsible use by making your first six monthly payments on time.

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Best For International Students

If you’re an international student who’s currently studying in the United States, you may have noticed how difficult it can be to get a credit card without having a social security number. If you find yourself in this predicament, the Deserve® EDU Mastercard for Students could be a great solution since you don’t need a social security number to be approved. The card lets you earn 1% cash back on all purchases and comes with benefits such as a year of and cell phone protection. It also has no annual fee or foreign transaction fees.

Terms apply.

How To Choose A Credit Card For Bad Credit

• Nail down your exact credit score. The types of credit cards youre eligible for will differ based on your credit score and plenty of other credit-related factors. Knowing exactly what your credit score is will help you navigate which credit cards you can feasibly be approved for, and also help you avoid behaviors that could damage your score like applying for too many credit cards in a short period of time.
• Be aware of the fees. A defining feature of many credit cards for bad credit is paying a bit extra up front as collateral in exchange for offering a line of credit. This collateral most often comes in the form of security deposits on secured credit cards and annual fees for many unsecured cards. Sometimes, a card will require both. Credit cards for bad credit also tend to have high ongoing APRs and rarely have intro APR offers. The best credit cards for bad credit have either a reasonable annual fee or a reasonable security deposit a lower-end ongoing APR and plenty of credit-building incentives.
• Keep credit building top of mind: An advantage of credit cards for bad to fair credit scores is the potential to help you build an even better score over time. You should always look for a card that reports to the major credit bureaus, as those entities will record your credit-building progress. Also look for cards with incentives for positive credit habits, like , or cards that have the option to graduate to a more lucrative or unsecured credit card version.

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How Can You Increase Your Credit Score With An Unsecured Credit Card

If you get an unsecured credit card, you should strategize on improving your credit score. It is more important to know all the factors that contribute to suitable credit scores. Remember that excellent credit scores are very useful when it comes to benefiting from services such as personal loans from a credit union.

Your credit score is the only tool that gives your lender confidence that you will be able to pay back your loan. There are various ways on how you can increase your credit score upon getting your card. These ways include the following.

i) Pay all your debts on time

Always follow your payment schedule to the latter. Skipping payments is always harmful to your credit score. A credit score payment history accounts for 35% of the total scores.

ii) Spend below the credit limit

Upon getting your card, ensure that you do not spend more than 30% of your credit limit. Spending too much lowers your credit score. You should show responsibility that you can manage money well by saving some.

iii) Actively use the card

Do not take the card and keep it without using it. Your credit card utilization also gives you scores. Make it active all the time. Even if you do not want to spend much on it, ensure that you spend a little each month.

Best Credit Cards For Bad Credit From Our Partners

No credit check and easy account management

Why We Like It

Pros & Cons

Product Details

The Chime Credit Builder Visa® Credit Card has no minimum deposit requirement, charges neither an annual fee nor interest, and doesn’t require a credit check, and you can automate your payments so you’re never late. But to get it, you must be a Chime banking customer

The Chime Credit Builder Visa® Credit Card has no minimum deposit requirement, charges neither an annual fee nor interest, and doesn’t require a credit check, and you can automate your payments so you’re never late. But to get it, you must be a Chime banking customer

Pros

• Instead of a security deposit, the card is backed by the money in a linked account, which you can add to at any time. The card won’t let you spend any more than you have in the account, and when your payment is due, you can have the money taken from the account automatically. In a way, it works like a prepaid debit card, but unlike a prepaid card, it helps build credit. No credit check required to apply.

Cons

Our pick for

Pros

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