If you have been attempting to get a credit card with bad credit, you must be wondering whether the bad credit credit cards guaranteed approval no deposit offers you’ve seen out there are legitimate. You must also be asking yourself, what is the meaning of guaranteed approval? While guaranteed approval unsecured credit cards for bad credit may sound like the ultimate solution to your woes on credit card, it may or may not be.
The truth is that any credit cards out there usually come with some kind of basic requirements before the issuer issues one to you. The key factor in these instant approval credit cards for bad credit is that they have minimal requirements to qualify. In fact, the majority of issuers will require an active checking account. This requirement is often to prove that you have income exceeding a certain amount, which is often the issuer’s minimum.
In addition, there is often the question of just how poor your credit is. In general, a credit score of between 300, which is the lowest FICO score, and 650 is viewed as bad credit. Nonetheless, some of the card issuers will take ratings of 550 – 650 to be simply poor credit. They may, therefore, consider you for the bad credit credit cards guaranteed approval no deposit offers.
What Is Bad Credit?
Typically, a bad credit score is under 580 from a range of 300-850 according to FICO. This means 850 is the best score possible. With a similar 300-850 score, the VantageScore defines poor credit as a score under 550.
Getting an excellent or good rating implies going for at least 700 scores. Below 700, you will receive higher interest rates as well as other less-than-stellar financial products offers.
That is bad news. The best part is that it only takes a couple of short months of great customer behavior and your score will be good. But beware: When setting on the track of excellent financial habits, be sure to keep it that way. This is because one mistake can drop those good ratings so quickly. In fact, the ratings can considerably drop faster than when you were refining your credit score.
Poor credit is determined by the manner in which you’ve handled your credit in the past years. If you have been missing payments or do not have sufficient information in your file, then your credit score may not be that great. The two most crucial elements of your credit score are:
- On-time payments accounting for 35% of your score
- How much you owe versus the amount of credit available accounting for 30% of your score
In other words, if you have been on the trend of making late payments, it could be the main reason behind those poor credit ratings. However, for those with a high balance on their credit cards, it can also be a heavyweight.
What Is Guaranteed Approval?
Every card issuer has basic requirements before allowing a new client. When it comes to issuing credit cards, guaranteed approval implies that you will be approved so long as you meet certain conditions. The best part is that these conditions are usually minimal. For instance, when searching for credit cards for people with bad credit, some issuer will only require you to:
- Submit contact information and your name,
- Prove to have a specific level of income
- Have a checking account.
Typically, when card providers claim to offer guaranteed approval, it is often followed by an asterisk. It is vital to follow the asterisk to the fine print. You should be able to find the requirements you have to meet before approval.
Guaranteed Approval vs Easy Approval
Most credit card issuers do not have explicit guaranteed approval. As an alternative, the issuers use language implying that it is easy for you to get approval. You will typically come across phrases such as “see if you prequalify” or “no minimum credit score”. While you still stand to be denied for this card, you basically have better odds compared with most other card issuers.
Unsecured Cards With Guaranteed And Easy Approval
When looking at an unsecured card, you do not have to submit a security deposit. A security fee is typically an upfront fee for opening a card. Unsecured cards with guaranteed approval are oftentimes online-based catalog cards. This implies you can only use the cards to purchase merchandise only at online outlets the issuers specify.
When a card is offering easy or guaranteed approval, you may want to first, read they’re fine print to make certain you fully apprehend what you are getting yourself into. These cards usually come with high fees and interest rates. In other words, you could be doing better with a secured card.
Unsecured Cards: Guaranteed Approval
When looking for guaranteed approval credit cards, you may want to consider Luxe Signature, Next Millennium Card, and Unique Platinum. Remember to check the respective online outlets where you can use these cards.
The best part: These cards have fairly simple requirements and eligibility. In this case, you must:
- US resident of at least 18 years
- Must agree to the card issuer’s terms and conditions
- Must have a valid payment method like a credit card, debit card, or checking account
- You Must prove the ability to make specified monthly payment when using the card’s entire credit line
- Pay the enrollment fees
Unsecured Cards: Easy Approval
Some card issuers do not promise approval. However, if you have less-than-stellar credit scores, their products are towards such consumers. You can consider some of these cards:
- Indigo Platinum Mastercard Credit Card: Currently known as Genesis FS Services, this card is for clients with damaged credit. However, you can still prequalify for the card without impacting your credit score. You will pay an annual fee ranging from $0, $59 to $75 during the first year and $99 thereafter.
- Total Visa Credit Card: The issuer says the card is ideal for persons facing financial difficulties and has previously struggled to get a card. However, you will want to watch out for a first-year annual fee of $75, high 29.99% APR, and an $89 processing fee.
- Milestone Gold Mastercard: Customers are able to prequalify for this product without affecting their credit score. Depending on their profile, they may pay an annual fee ranging from $35, $59 to $75 within the first year and $99 thereafter.
- Credit One Bank Visa with Free Credit Score Tracking: Clients get to prequalify for the card without necessarily affecting their credit score. Some customers will qualify without an annual fee. However, you may pay $75 during the first year, and $99 thereafter.
Top 5 Best Credit Cards For Bad Credit Providers In 2020
|Best For||Credit Card||Annual Fee||Deposit Requirement|
|Building credit||Credit One Bank® Visa® Credit Card||$0-$75 for first year, $0-$99 each additional year||$0|
|No security deposit||Indigo® Platinum Mastercard®||See terms*||$0|
|No annual fee||Capital One® Secured Mastercard®||$0||$49, $99, or $200 (Refundable)|
|$0 fraud liability||Total Visa® Unsecured Credit Card||See terms*||$0|
The 5 Best Credit Cards For Bad Credit Providers Review
Discover It Secured
This is one of the best secured credit card providers of 2020, due to their 0$ annual fee. This is besides rewarding cardholders with 1% to 2% purchase cash backs. This credit card issuer will double the rewards cardholders earn within the first year. Only a few secured cards will offer rewards.
- Signature Discover feature doubling your cashback upon completion of the first year
- Earning 2% back to $1,000 a quarter at restaurants and another 2% back upon completion of your first year
- Low widespread acceptance abroad a deterrent for travelers who use credit cards
Credit One Bank Visa Credit Card
This is a great, unsecured credit card option if you are seeking to rebuild your credit. In most cases, however, you can find a less costly card with more rewards when you choose a secured credit card instead. Rewards and terms under Credit One Visa will vary dramatically subject to creditworthiness, and you will not even know which of their credit cards you get until they approve you.
- Choosing preferred due date
- Access to free Experian credit score.
- Different card designs to choose from
- Lower rewards in comparison with Discover it Secured Card
Indigo Platinum Mastercard
This credit card caters to the needs of persons with bad credit. For those who are struggling to get approvals from other issuers and are looking at FICO scores below 600, this could be the Indigo Platinum Mastercard may just be the way to build credit. They do not offer any rewards but do report to credit bureaus. They are a good option for helping you establish records of on-time payments within your credit records.
- A foreign transaction fee is a low 1%
- Hidden fees kept to a minimum.
- No security deposit required
- Rising annual fee
- Low initial credit limit often ranging from $225-$300
- No ongoing rewards or sign-up bonus offered
Capital One Secured Mastercard
Unlike many card providers that need a cash security deposit, you can qualify for a credit limit larger than what they ask for their deposit. Their flexible requirements for security deposit and a zero annual fee make Capital One Secured Mastercard an excellent choice fo those seeking to build or rebuild credit.
- No annual or hidden fees
- Access to a better credit line with no additional deposits after 5-months’ on-time payments
- No foreign transaction fees
- No ongoing rewards or sign-up bonus offered
Total Visa Unsecured Credit Card
This credit card is geared towards persons with poor credit. But is it worth applying for? Total Visa Unsecured Credit Card comes with too many uncommon fees like monthly and program servicing fees to watch out for. In addition, this card has some key restrictions like not being able to use it outside the U.S. If you are looking for options catering to persons with less-than-stellar credit, there are other providers with superior offers.
- The convenience of being in Visa network builds credit score among its 3 major credit bureaus
- Unsecured card: no refundable upfront deposits
- Purchasing APR is sky-high
- A one-time program fee of $89
- Other fees might reduce your savings
Implications Of Bad Credit
You desperately are looking for bad credit credit cards guaranteed approval no deposit offers. According to the Experian, 17% of consumers are on the bad credit list. In fact, more than 1/3 of the population has a subprime score. This means their scores range between the fair and poor categories. Only 19% of Americans have exceptional credit scores.
Having said that, what do those scores mean to consumers like you? Here is a table showing the percentage of persons with different scoring range and the implications:
Credit Score Ranges
|Credit Score||Rating||% of People||Impact|
|300 – 579||Poor||17%||Credit applicants may be required to pay a fee or deposit, and applicants with this rating may not be approved for credit at all.|
|580 – 669||Fair||20.2%||Applicants with scores in this range are considered to be subprime borrowers.|
|670 – 739||Good||21.5%||Only 8% of applicants in this score range are likely to become seriously delinquent in the future.|
|740 – 799||Very Good||18.2%||Applicants with scores here are likely to receive better than average rates from lenders.|
|800 – 850||Excellent||19.9%||Applicants with scores in this range are at the top of the list for the best rates from lenders.|
Types of Cards to Avoid With Bad Credit Score
Before getting to choose instant approval credit cards for bad credit, it is best to remember that with a poor credit score, the credit product options are highly limited. Even if you look around and get a card for better credit, with a poor track record, you will want to avoid some cards. These are:
- Balance transfer cards: When you are already facing challenges in terms of making full bill payments, balance transfer cards are not going to solve your issues. If you choose to transfer from lower APR card to a higher APR with 0% offer, it might exacerbate your issues once the offer ends.
- High annual fees credit cards: As tempting as cards might be, with generous ongoing rewards, annual credit, among other goodies, you’ll want to avoid credit cards with high annual fees. With a limited cash output, you will not be in a position to take full advantage of the features in the card. However, you can work to build your credit using a simpler card.
- High credit score cards: There is no point applying for a card that needs high credit scores when your ratings are actually rock-bottom. The only achievement will be a ding on your already poor credit score for the rectitude of providing personal information.
- High initial spending cards: An amazing 50,000 points bonus upon sign-up may seem like an irresistible offer. However, it helps to keep in mind that this often comes with statutory spending you may not be in a position to afford. You do not want to commit to spending money you do not have in your account and for items, you do not even need.
Are you ready to build your credit? There are many tricks that can increase your ratings to what you need. The best thing is that it should only take a couple of months if you do it right. The moment you get your score to around 700 on a FICO scale of 300-850, your options with regard to credit cards will open up considerably. Nonetheless, be sure to keep in mind the most valuable component of the FICO scoring model. Most lenders use this model. Your payment history makes up 35% of your score. Even as you land one of the best guaranteed approval unsecured credit cards for bad credit, be sure to use it towards building your score and avoid adding more debts.