Did you know that 30 research hours went into picking the best credit cards for building credit? They looked at 1,745 credit cards from 371 companies. This deep dive found the top cards to help you build or improve your credit score. If you’re starting or rebuilding credit, the right card can really help.
Key Takeaways
- Building a strong credit history is crucial for your financial well-being
- Certain credit cards are specifically designed to help you build or rebuild your credit score
- Secured credit cards can provide a solid foundation for credit building
- Unsecured credit cards with low fees and rewards can also be effective for credit improvement
- Monitoring your credit utilization ratio and payment history are key to maintaining a good credit score
Understanding Credit Cards for Building Credit
Choosing the right credit card is key to improving your credit score. There are two main types: secured and unsecured credit cards. Each type has its own benefits for credit-building.
Types of Credit Cards for Building Credit
Secured credit cards need a deposit, usually $200 or more, which becomes your credit limit. This deposit helps people with bad or no credit start or rebuild their credit. Unsecured credit cards don’t need a deposit but might have higher fees or interest rates.
Factors to Consider When Choosing a Credit Card
When picking a credit card, think about annual fees, APR, reward programs, and if the issuer reports to credit bureaus. This last point is crucial for your credit score to improve over time.
The Platinum Prestige Mastercard® Secured Credit Card offers 1% cash back, costs $49 a year, and has a 15.24% APR. The AvantCard charges $75 a year and has a 35.99% APR, which might not be the best for building credit.
By knowing the different credit-building cards and what matters to you, you can pick the best one. This choice can help secure your credit score, build your credit history, and establish a strong financial foundation for the future.
Secured Credit Cards: A Solid Foundation
For people with poor or no credit, secured credit cards are a great choice. They need a refundable security deposit, usually $200 to $300, which is your credit limit. This deposit lowers the risk for the card company, making it easier to get these cards.
Using a secured card wisely by paying on time is key to building or fixing your credit score. Many secured cards send your payment history to the big three credit agencies. This can help improve your credit over time.
Secured credit cards for credit building have higher interest rates and fees than unsecured cards. But, they’re made to help you start or better your credit history. If you use it well, you might get an unsecured credit card with better terms in 6-12 months.
| Secured Card | APR | Credit Limit |
|---|---|---|
| Capital One Platinum Secured Credit Card | 30.74% Variable | $200 – $5,000 |
| Capital One Quicksilver Secured Cash Rewards Credit Card | 29.99% Variable | $200 – $5,000 |
| Bank of America® Customized Cash Rewards Secured Credit Card | 28.24% Variable | $200 – $5,000 |
| Discover it Secured Card | Not provided | $200 – $2,500 |
| UNITY Visa® Secured Credit Card | 17.99% Fixed | $300 – $10,000 |
| Credit One Bank® Secured Card | 29.24% | $200 – $300 |
The main thing to remember with a secured card is to keep your credit utilization low, under 30%. And always pay on time. This good use can help you build a strong credit history. It will also open doors to better credit options later.
Unsecured Credit Cards for Building Credit
Unsecured credit cards are great for improving your credit score, especially if you have limited or poor credit history. They help you build credit without needing a security deposit.
Low Fees and Rewards
When looking at unsecured credit cards for credit building, check the fees and rewards. Many cards have low fees, from $0 to about $50, making them easier to get. Some also offer cash back or points, letting you earn as you use the card responsibly.
About 80% of credit card issuers want good or excellent credit (FICO scores of 670 to 850) for their best offers. But, many unsecured credit cards for credit building are for people with fair credit, scores between 580 and 669. These cards might have higher APRs but focus on building your credit history.
When picking unsecured credit cards for credit building, think about annual fees, rewards programs, and credit limits. Choosing the right card can help improve your credit score and open up better financial opportunities later.
Best Credit Cards for Building Your Credit Score
Building or rebuilding your credit score can seem tough, but the right credit cards can help. We looked at over 1,745 credit card options to find the best ones for building your credit score.
Our research took 30 hours and looked at 371 companies. We found several credit cards that are great for different financial situations and credit levels. These cards are perfect for students, newcomers, or anyone rebuilding their credit. They offer features and benefits just for you.
| Credit Card | Key Features | Bankrate Score | Rating |
|---|---|---|---|
| Capital One Platinum Secured Credit Card | No annual fee, reports to all three major credit bureaus, and the opportunity to graduate to an unsecured card | 4.1 out of 5.0 | 4.7 out of 5 stars (based on 490 reviews) |
| Discover it® Secured Credit Card | Cash back rewards, no annual fee, and the ability to upgrade to an unsecured card | 4.5 out of 5.0 | 4.5 out of 5 stars (based on 1,172 reviews) |
| OpenSky® Secured Visa® Credit Card | No credit check required, reports to all three major credit bureaus, and the option to upgrade to an unsecured card | 3.1 out of 5.0 | 4.19 out of 5 stars (based on 361 reviews) |
These credit cards are great for building or rebuilding your credit. They offer no annual fees, rewards, and the chance to move to unsecured cards as your credit gets better. By using these cards wisely and paying on time, you can improve your credit score. This opens up more financial opportunities for you.
To use credit cards for building credit well, keep your credit use low, pay on time, and check your credit report often. With the right strategy and these top credit cards, you can take charge of your financial future. You can reach your credit score goals.
Capital One Cards for Credit Building
If you want to build or fix your credit, Capital One has two great options. They offer the Capital One Platinum Secured Credit Card and the Capital One Quicksilver Secured Cash Rewards Credit Card. These cards are perfect for starting or improving your credit. They report to all three major credit agencies to help boost your credit score.
Capital One Platinum Secured Credit Card
The Capital One Platinum Secured Credit Card is ideal for those with fair or poor credit. It requires a refundable deposit of $49 to $200, which sets your credit limit. With no annual fee, it’s a budget-friendly way to build credit. Plus, it won’t cost you anything extra.
Customers love this card, giving it a 5-star rating. Out of 14,066 reviews, it scored 4.4 out of 5 stars. People using this card saw their credit scores improve after making regular payments for six months.
Capital One Quicksilver Secured Cash Rewards Credit Card
The Capital One Quicksilver Secured Cash Rewards Credit Card gives you 1.5% cash back on all purchases. It also helps you build credit by reporting to all three major credit agencies. This card is perfect for earning rewards while improving your credit.
Both the Capital One Platinum Secured Credit Card and the Capital One Quicksilver Secured Cash Rewards Credit Card are great for those with fair or poor credit. By paying on time and using the cards wisely, you can show you’re creditworthy. You might even get your deposit back and move to an unsecured card.
Discover Cards for Establishing Credit
Discover is a top issuer of credit-building cards. The Discover it® Secured Credit Card is a great choice for those starting or rebuilding their credit. It requires a refundable security deposit, usually $200 or more, which becomes your credit limit. This card is special because you can earn 2% cash back at gas stations and restaurants. This makes it a great way to build credit while earning rewards.
Discover it® Secured Credit Card
The Discover it® Secured Credit Card reports to all three major credit bureaus. This helps you build your credit history. With no annual fee and cash back opportunities, it’s a practical way to improve your creditworthiness.
- No annual fee
- Earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter
- Earn 1% cash back on all other purchases
- Discover will automatically match all the cash back earned at the end of the first year
- Refundable security deposit of $200 or more becomes your credit limit
- Upgrade to an unsecured card after 6 consecutive on-time payments
- Reports to all three major credit bureaus
The Discover it® Secured Credit Card is a smart choice for those wanting to discover cards for establishing credit and discover cards for credit building. With cash back rewards and the chance to move to an unsecured card, this discover it secured credit card is a valuable tool for improving your credit score.
Credit One Bank Cards for Credit Rebuilding
If you’re looking to rebuild your credit, Credit One Bank has several credit card options for you. The Credit One Bank American Express Card for Rebuilding Credit and the Credit One Bank Secured Card are great for those with poor or no credit history.
These cards report to all three major credit bureaus, which is key for improving your credit score. They also offer cash back rewards on some purchases and the chance to graduate to an unsecured card as you manage your credit well.
But, some customers have faced issues with high rates, fees, frozen accounts, and poor customer service from Credit One Bank. A few have struggled with disputing fraudulent charges and had renewal problems when their card was closed without a new one being sent.
| Card | Annual Fee | APR | Cash Back | Credit Score Required |
|---|---|---|---|---|
| Credit One Bank® Platinum Visa® for Rebuilding Credit | $75 for the first year, $99 annually thereafter | 29.74% Variable | 1% on select purchases | Bad Credit |
Despite some drawbacks, many customers have given positive feedback. They like the chance to rebuild their credit with Credit One Bank’s user-friendly apps and websites. If you’re careful with your credit, a Credit One Bank card could be a good choice for credit rebuilding.
Citi Secured Mastercard for Credit Improvement
The Citi Secured Mastercard is a great choice for those wanting to improve their credit score. It requires a refundable security deposit, which becomes your credit limit. This makes it easy for people with poor or limited credit history to get it.
Benefits and Features
The Citi Secured Mastercard has many benefits for credit-building:
- Reporting to all three major credit bureaus: Your responsible use of the card will be reported to Experian, Equifax, and TransUnion. This helps build and improve your credit history.
- Opportunity for credit limit increase: If you use the card responsibly, you might get a credit limit increase. This can help improve your credit score by lowering your credit use ratio.
- Potential to upgrade to an unsecured card: After 12 months of good use, you could switch to an unsecured Citi credit card. This means you get your security deposit back.
The annual fee for the Citi Secured Mastercard is $0, making it a budget-friendly choice for building credit. You can start with a security deposit of $200 to $2,500, depending on what you can afford. The ongoing APR is 26.74% Variable, which is typical for secured credit cards.
“Practice disciplined spending and repayment habits with your credit card, which can help you reap the rewards of a strong credit history.”
Using the Citi Secured Mastercard can help you build a strong credit foundation. This can lead to getting an unsecured card in the future.
Petal Cards for No Credit History
If you’re starting your credit journey with no prior history, the Petal 2 “Cash Back, No Fees” Visa Credit Card can be a gamechanger. This card doesn’t require a security deposit, making it easy for those new to credit. It also reports to all three major credit bureaus, helping you build a solid credit foundation from scratch.
The Petal 2 card offers a competitive cash back program, providing 1%-1.5% cash back on everyday purchases. This rewards structure encourages responsible spending habits as you work to build your credit score. Plus, your credit limit can increase over time, growing with your financial journey.
Beyond rewards and credit-building, the Petal 2 card is known for its transparent and user-friendly approach. It doesn’t charge annual fees, late fees, or any other hidden charges that can burden credit newcomers. This makes it easier for you to focus on developing healthy credit habits without extra fees.
If you’re looking to petal your way into the world of credit, the Petal 2 “Cash Back, No Fees” Visa Credit Card is a great option. It’s perfect for individuals with no credit history. Its accessibility, rewards, and transparent pricing make it an excellent choice.
| Feature | Petal 2 Visa Credit Card |
|---|---|
| Annual Fee | $0 for new cardholders, $75 first year, $99 thereafter |
| Cash Back Rewards | 1%-1.5% on eligible purchases |
| Late Fees | Details not provided |
| Foreign Transaction Fees | $1 or 3% of each transaction, whichever is greater |
| APR Range | 18.24% – 32.24% variable |
| Other Features | Freeze card feature, fraud detection technology |
Remember, the petal cards for credit building are designed to help individuals with no credit history establish a solid credit foundation. The petal 2 cash back credit card for credit building offers a seamless path to responsible credit usage and improved creditworthiness over time.
OpenSky Secured Visa for Credit Building
Application Process and Requirements
The OpenSky Secured Visa Credit Card is a great option for building or rebuilding credit. It needs a refundable security deposit, which sets your credit limit. The application is easy, with no credit check, making it open to those with limited or poor credit.
This card has an 88% approval rate, giving you a good chance of getting it. You can deposit between $200 to $3,000, depending on what you’re approved for. The OpenSky Plus card also requires a $300 deposit, but it can go up to $3,000 if approved.
One big plus of the OpenSky Secured Visa Credit Card is it helps you build credit over time. It reports your payments to all three major credit agencies every month. This helps make your credit history positive. Plus, you can switch to an unsecured card in 6 months, boosting your credit even more.
To see the biggest credit score gains, keep your spending under 30% of your credit limit. The card also lets you increase your credit line every 6 months without needing more deposits or applications. This gives you control over your credit use.
With its low annual fee and chance to earn up to 10% cash back, the OpenSky Secured Visa Credit Card is a strong choice for those wanting to improve their credit with a secured card.
| Feature | Details |
|---|---|
| Approval Rate | 88% average approval rate |
| Security Deposit | $200 to $3,000 for OpenSky Secured Visa $300 to $3,000 for OpenSky Plus |
| Cash Back Earnings | Up to 10% cash back on purchases |
| Credit Reporting | Monthly reporting to all three major credit bureaus |
| Credit Line Increases | Possible every 6 months |
| Annual Fee | $35 |
| Regular APR | 25.64% (variable) |
The OpenSky Secured Visa Credit Card is a top pick for those looking to improve their credit. It has a simple application, no credit check, and helps you build your credit over time. This card can be a key part of your credit-building efforts.
Credit Utilization and Payment History Tips
If you’re using credit cards to build your credit, focus on credit utilization ratio and payment history. Keep your credit utilization ratio, which is how much credit you use versus your total limit, under 30%. This can boost your credit score. Also, paying all your bills on time and in full is key. Payment history is the biggest factor in your credit score.
It’s important to regularly check your credit report. This lets you track your progress and spot any issues early. By keeping an eye on your credit reports, you can make sure your credit use and payment history are reported correctly. This helps you build your credit score over time.
- Maintain a low credit utilization ratio, ideally below 30%.
- Make all of your payments on time and in full.
- Regularly monitor your credit reports to ensure accuracy and identify any problems.
| Statistic | Value |
|---|---|
| Percentage of credit cardholders carrying debt month-to-month | 39% |
| Percentage of credit cardholders who haven’t switched their primary card in 5+ years | 49% |
| Percentage of millennials with more credit card debt than emergency savings | 32% |
| Total credit card balance in the U.S. as of Q3 2022 | $866 billion |
| Year-over-year increase in credit card balances since Q3 2021 | 19% |
| Average American credit card debt in Q3 2022 | $5,474 |
| Average new account credit line in Q3 2022 | $5,021 |
By keeping a low credit utilization ratio and paying on time, you can build a strong payment history. This, along with good credit report monitoring, lays a solid credit foundation. These steps can open doors to better financial opportunities in the future.
Conclusion
Building or rebuilding your credit score is possible with the right credit cards and smart use. This article talked about credit cards from Capital One, Discover, Citi, Credit One Bank, and Petal. These cards are great for starting or improving your credit.
Understanding what affects your credit score is key. This includes how well you pay your bills, how much credit you use, and how long you’ve had credit. Using these credit cards wisely can help you improve your financial future.
It’s important to pay your bills on time and keep your credit use below 30%. Also, opening a credit card early and keeping it active shows lenders you’re reliable. This can greatly help your credit score.
By following these tips and using the credit cards mentioned, you can manage your credit better. This leads to a brighter financial future.
In conclusion, the right strategies and tools can help you overcome credit issues. Use these credit-building credit cards to start on a path to a stronger credit score and better financial health.
FAQ
What are the main types of credit cards for building credit?
There are two main types: secured and unsecured cards. Secured cards need a refundable deposit. Unsecured cards don’t.
What factors should I consider when choosing a credit-building card?
Look at fees, APR, rewards, and if it reports to all three major credit bureaus.
How do secured credit cards help build credit?
Secured cards are great for building credit. They use a refundable deposit to lower risk. Using them well can improve your credit score.
What are some benefits of unsecured credit cards for building credit?
Unsecured cards for building credit might have lower fees and rewards. They’re good for those without a deposit.
What are some of the best credit cards for building or rebuilding credit?
Top choices include secured cards from Capital One, Discover, and Citi. Unsecured options are from Credit One Bank and Petal.
How can the Capital One Platinum Secured Credit Card and Capital One Quicksilver Secured Cash Rewards Credit Card help build credit?
Both cards report to all major credit bureaus, helping you build credit. The Quicksilver Secured card also offers 1.5% cash back, making it rewarding for credit building.
What makes the Discover it Secured Credit Card a good choice for building credit?
It reports to all major credit bureaus and offers 2% cash back at gas stations and restaurants. It’s great for building credit.
How can the Credit One Bank cards help rebuild credit?
The Credit One Bank American Express Card and the Secured Card are for rebuilding credit. They report to all major bureaus and offer cash back rewards. You can also upgrade to an unsecured card over time.
What are the benefits of the Citi Secured Mastercard for building credit?
It reports to all major credit bureaus, offers credit limit increases, and can upgrade to an unsecured card in 12 months with good use.
How can the Petal 2 “Cash Back, No Fees” Visa Credit Card help build credit from scratch?
The Petal 2 card is an unsecured card with no deposit needed. It reports to all major bureaus and offers cash back rewards, helping you start building credit.
What are the key factors to focus on when using credit cards to build credit?
Focus on keeping your credit utilization under 30% and having a good payment history. Check your credit reports regularly to track your progress and spot any issues.
