Did you know 70% of Americans have a credit score below 700? If you’re in this group, don’t worry. A credit card for fair credit could help you gain financial freedom. Fair credit scores are between 580 and 669 on the FICO scale, so you’re not alone in improving your score¹².

Credit cards for fair credit offer a chance to boost your score and enjoy some benefits. They help you build a good credit history by reporting to major credit bureaus. Plus, you can earn cash back rewards of 1% to 2% on your purchases¹.

These cards may have higher APRs, from 15.24% to 35.99%. But, they’re a step towards better credit. By using credit wisely, you could see your credit limit increase over time¹. The subprime credit market is growing, with some cards offering up to 10% cash back at certain stores².

If you want to improve your credit score or just check out your options, credit cards for fair credit are a great choice. Let’s explore how these cards can aid in your credit-building journey.

Key Takeaways

• Fair credit scores typically range from 580 to 669 on the FICO scale
• Credit cards for fair credit can help improve your credit score
• Some cards offer cash back rewards from 1% to 2%
• APRs on fair credit cards range from 15.24% to 35.99%
• Responsible use can lead to credit limit increases
• Some cards offer up to 10% cash back with select merchants
• These cards are valuable tools for credit building

Understanding Fair Credit Scores

Credit scores are key to your financial health. Scores from 580 to 669 are considered fair for FICO® Scores and 601 to 660 for VantageScore³. This range is in the middle of the credit score spectrum, which goes from 300 to 850³.

What is considered a fair credit score?

In 2023, the average FICO Score in the U.S. was 715, with most scores between 600 to 750⁴. If your score is between 580 and 669, you’re in the fair credit range. You’re not in the subprime range, but you can still improve your credit history.

Factors affecting your credit score

Several factors influence your credit score. FICO’s model looks at these key elements:

• Payment history: 35%
• Credit utilization ratio: 30%
• Length of credit history: 15%
• Credit mix: 10%
• New credit: 10%⁴

To improve your score, pay on time, keep your credit use low, and have a varied credit mix. Focus on these areas for better credit repair.

Why fair credit matters

Fair credit can affect your financial chances. For example, a score of 600 might get you over 16% approval for some credit cards, while a good score of 700 gets nearly 29% approval⁵. Also, a fair score could mean paying more in interest. On a $30,000 auto loan, a fair score of 600 versus a good score of 700 could mean paying $101 more monthly and $3,637 more in total interest over 36 months⁵.

By working on credit repair and managing your credit well, you can aim for a better score. This can lead to better financial products, lower interest rates, and more favorable loan terms in the future.

Benefits of Credit Cards for Fair Credit

Credit cards for fair credit help you grow financially. They are for people with scores from 580 to 669, as per FICO®⁶. These cards make it easier to build credit and have better approval chances than premium cards.

They also offer rewards. For example, the Capital One QuicksilverOne Cash Rewards Credit Card gives 5% cash back on hotels and rental cars through their travel portal⁷. This way, you can earn rewards while boosting your credit score.

Many fair credit cards don’t have an annual fee. The Capital One Platinum Credit Card is one such card, with no annual fee⁷. It also looks at increasing your credit limit after six months of good use.

Credit-building tools are a big plus. They report to credit bureaus regularly, helping you build a good credit history. Some cards even let you check your credit score for free, so you can see how you’re doing over time.

“Paying bills in full each month is crucial to avoid expensive interest charges and improve credit scores.”

WalletHub’s editors look at over 1,500 credit card offers to find the best ones for fair credit⁸. Their research helps make sure you get the right card for building your credit.

Top Credit Cards for Fair Credit

Looking to improve your credit score? Picking the right credit card is key. For those with fair credit, scores between 580 and 669, there are many options with great features⁹.

Capital One QuicksilverOne Cash Rewards Credit Card

The Capital One QuicksilverOne Cash Rewards Credit Card is a top pick for its rewards. You get 1.5% cash back on all buys, perfect for daily expenses. Although it has a $39 yearly fee, the rewards can make up for it if you use it a lot.

Upgrade Cash Rewards Visa®

The Upgrade Cash Rewards Visa® combines a credit card with a personal loan. It offers credit limits from $500 to $25,000 and 1.5% cash back on buys. This card is great for those needing to consolidate debt or buy big items.

Capital One Platinum Credit Card

For those who don’t want to pay an annual fee, the Capital One Platinum Credit Card is a good choice. It can help you get a higher credit limit after just six months of paying on time. This is a great option for building credit¹⁰. It also reports to credit bureaus, helping your credit score⁹.

When picking a card, think about annual fees, APRs, and how it helps build credit. Top cards for fair credit often have no annual fees and offer 1.5% to 5% cashback⁸. Always pay your bill on time to boost your credit score, as this is a big part of your creditworthiness⁸.

Features to Look for in Fair Credit Cards

When looking for a credit card with bad credit or a secured card, it’s key to know what features can help improve your finances. These cards, for those with fair credit, are for FICO scores between 580 and 669. They provide a way to get better credit with smart use¹¹.

Choose cards that report to major credit bureaus to help build your credit history. Many fair credit cards have annual fees and higher interest rates. So, it’s important to compare them carefully¹¹. The Capital One QuicksilverOne Cash Rewards Credit Card, for instance, offers up to 5% rewards but has a $39 annual fee¹²¹¹.

Having free credit score access is also a great feature. Cards like the Petal® 2 “Cash Back, No Fees” Visa® Credit Card give more rewards for good behavior. You can earn up to 1.5% cash back after making 12 on-time payments¹².

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Look for cards with no annual fee, like the Chime Credit Builder Secured Visa® Credit Card. It doesn’t need a credit check and has no annual interest charges¹¹. For students, the Capital One SavorOne Student Cash Rewards Credit Card offers up to 10% rewards with no annual fee¹¹.

Card Name	Annual Fee	Rewards	Special Features
Capital One QuicksilverOne	$39	Up to 5% cash back	Fair credit acceptance
Chime Credit Builder	$0	None	No credit check, secured
Capital One SavorOne Student	$0	Up to 10% cash back	$50 sign-up bonus

While rewards are nice, focus on cards that offer a clear way to get better terms as your credit score improves. Balance the rewards against fees and interest rates to pick the best card for your financial goals.

How to Choose the Right Credit Card for Fair Credit

Choosing the best credit card for fair credit means looking closely at your options. With scores between 630-689, you have several choices². Let’s explore what to consider for a smart choice.

Assessing Your Spending Habits

Look at your monthly spending to find a card that fits your life. Some cards give bonus cash back at places like restaurants and gas stations, great for those who eat out or drive a lot². Others offer up to 1.5% cash back on all buys, perfect for everyday expenses².

Comparing Annual Fees and Interest Rates

Annual fees for fair credit cards vary a lot. For instance, the Capital One QuicksilverOne Cash Rewards Credit Card has a $39 yearly fee². APRs usually range from 15.24% to 35.99%, depending on the card¹. Think about how these costs fit into your budget and spending habits.

Evaluating Rewards Programs

Search for cards with cash back, points, or miles that suit you¹. Some cards offer 1% to 5% cash back on purchases, which can help you save more¹. Using your card wisely can also help boost your credit score over time.

When picking a card, think about your credit card approval odds. Applying for cards suited to your score increases your approval chances². Keeping your credit use below 30% helps keep your score healthy². With the right card and smart use, you can improve your credit and maybe get better offers later.

Building Credit with Fair Credit Cards

Fair credit cards are great for fixing and building credit. They are for people with scores from 580 to 669. Using these cards right can help improve your credit over time⁹⁶.

Many fair credit cards have features to help you improve your credit. They report to big credit agencies regularly, so your good payment history gets noted¹³. Some cards also let you check your credit score for free, so you can see how you’re doing¹³.

To get the most from your fair credit card:

• Make timely payments
• Keep your credit use under 30%
• Check your credit report often

While you’re building credit, you can also get cash back rewards. Some cards give up to 1.5% cash back, so you earn while you improve your credit¹³.

“A fair credit card is not just a financial tool; it’s a stepping stone to better credit and greater financial opportunities.”

Improving your credit score takes time and steady effort. By using your fair credit card wisely and keeping an eye on your progress, you can move from fair to good credit. This opens up better financial options for you in the future.

Credit Score Range	Card Type	Key Features
580-669	Unsecured	Cash back rewards, no annual fee
Below 580	Secured	Security deposit, lower credit requirements

Choosing a secured or unsecured card is up to you. The main thing is to see it as a way to better your credit. With patience and careful use, your fair credit card can lead to a brighter financial future.

Rewards Programs for Fair Credit Cards

Credit cards for fair credit often have rewards programs. These let you earn as you build your credit. Let’s look at the rewards you can get and how they help you.

Cash Back Options

Cash back rewards are a favorite among fair credit cards. Some cards give a flat cash back on all buys. Others offer more in certain categories.

The Discover it® Secured Credit Card gives 2% cash back at gas stations and restaurants on up to $1,000 in combined buys each quarter¹⁴. It also matches all cash back earned in the first year, doubling your rewards¹⁴.

Points and Miles

Some fair credit cards offer points or miles, though it’s less common. The Bank of America® Travel Rewards Credit Card for Students gives 1.5 points for every $1 spent on all buys¹⁴.

For travelers, the Credit One Bank Wander® Card earns 10X points on hotels and rental cars booked through their travel partner. It also earns 5X points on flights, dining, and gas buys¹⁴.

Introductory Bonuses

Introductory bonuses are available on some fair credit cards to start your rewards. The Bank of America® Travel Rewards Credit Card for Students offers 25,000 online bonus points after spending $1,000 in the first 90 days¹⁴.

Other cards, like the Chase Freedom Rise℠, give a $25 statement credit for setting up automatic payments¹⁴.

When picking a rewards card, think about your spending and financial goals. Most travel credit cards need scores of 670 and above. But, some are for those rebuilding their credit scores¹⁴. With careful use, these rewards can be valuable while you improve your credit.

Credit Card for Fair Credit: Key Considerations

Looking for a credit card with fair credit? First, know what fair credit means. It’s scores from 580 to 669 on the FICO® Score or 601 to 660 on the VantageScore®¹⁵. About 17% of people have these scores, making up 13% of the VantageScore group¹⁵.

APR is a big deal. Cards for fair credit have APRs from 19% to 29% or more. The Citi Double Cash® Card has a variable APR of 19.24% to 29.24%¹⁶. Always compare APRs to find the best deal.

Annual fees matter too. Some cards have fees, but the Citi Double Cash and Citi Custom Cash don’t¹⁶. This makes them great for building credit without extra costs.

Rewards programs differ a lot. The Capital One QuicksilverOne Cash Rewards Credit Card gives 5% cash back on hotels and rental cars¹⁷. The Citi Custom Cash® Card offers up to 5% cash back on your top spending category each cycle¹⁶.

Think about credit limit increases too. Some cards review your limit after you show you can handle more. This can help your credit score by lowering your credit use ratio¹⁵.

Last, choose cards that report to all three major credit bureaus. This helps build a good credit history, which can boost your score¹⁵. Remember, fair credit is below average. Using your card wisely can help you move up to better credit levels.

Secured vs. Unsecured Credit Cards for Fair Credit

When building credit, you can choose between secured and unsecured credit cards. Secured cards require a cash deposit, usually $200 to $500, as collateral. This deposit helps protect the issuer¹⁸¹⁹.

Unsecured cards don’t need a deposit but require higher credit scores. You’ll need a score of 670 or more for these cards. Secured cards are better for those with no credit or scores under 669¹⁸.

Secured cards are a good first step in building credit. They report to major credit bureaus, helping you start a credit history. Some, like the Discover it® Secured Credit Card, offer rewards without an annual fee¹⁸.

Unsecured cards offer better perks and lower interest rates. They often have rewards programs, like cashback or travel points. But, they’re harder to get if you have fair credit¹⁸.

Feature	Secured Credit Cards	Unsecured Credit Cards
Deposit Required	Yes	No
Typical APR	Over 20%	Lower than secured cards
Credit Score Needed	No credit or below 669	670 or higher
Rewards	Sometimes available	More common

Both secured and unsecured cards can help build credit if used right. The main thing is to pay on time and keep your credit use low. With good habits, you could move to an unsecured card in six months to a year²⁰.

Improving Your Credit Score with Responsible Card Use

Improving your credit score is a long-term effort. But, using a credit card wisely can help speed things up. Let’s look at how you can use your card to better your credit history and start fixing your credit.

Making Timely Payments

It’s key to pay your credit card bill on time. Payment history is 35% of your FICO® Score, making it the biggest factor in your creditworthiness²¹. You can set up automatic payments or reminders to avoid missing due dates. Paying on time can boost your credit score in three to six months²².

Managing Credit Utilization

Your credit utilization rate is crucial for your credit score. The CFPB suggests keeping your credit card balances under 30% of your total limit²². Aim for a utilization rate under 10%²³. Paying your bill early or making extra payments can help keep your balance low.

Monitoring Your Credit Report

Check your credit report often for mistakes or identity theft signs. The big three credit bureaus, Experian, TransUnion, and Equifax, use reports from credit card companies²³. Use free credit monitoring services, like Experian’s, to keep an eye on your score and get tips for improving your credit.

Building credit takes time. With patience and smart card use, you can see big improvements in your credit score and financial health.

Common Mistakes to Avoid with Fair Credit Cards

Using credit cards wisely can boost your credit score, but missteps can set you back. Let’s explore some pitfalls to sidestep on your journey to better credit.

Many Americans carry credit card balances month-to-month, thinking it improves their credit score. This is a myth. In reality, it can hurt your credit and lead to debt²⁴²⁵.

Your credit utilization ratio is key to fixing your credit. Experts say keep it under 30%. Using less than 30% of your credit limit can help you get your card approved²⁴.

Late payments can really hurt your credit score. A 30-day late payment can drop your score by up to 83 points. A 90-day delay can cause a drop of up to 133 points²⁵.

“Paying your credit card bill on time and in full each month is the golden rule of responsible credit use.”

Avoid maxing out your card. Top credit scorers use only 7% of their credit. High utilization can lower your score and signal financial strain²⁵.

Don’t apply for multiple cards in a short time. Each application results in a hard inquiry, temporarily lowering your score. Space out applications by at least six months²⁴²⁵.

Mistake	Consequence	Recommendation
Carrying a balance	High interest, increased debt	Pay in full each month
Late payments	Credit score drop, late fees	Set up automatic payments
High utilization	Lower credit score	Keep usage below 30%
Frequent applications	Multiple hard inquiries	Apply no more than once per 6 months

By avoiding these common mistakes, you’ll be on track to improve your credit score and make the most of your fair credit card.

Transitioning from Fair to Good Credit

Moving from fair to good credit takes dedication and smart money habits. A fair credit score is between 580 and 669, and good credit scores are from 670 to 739²⁶. This change can save you over $22,000 in the long run²⁷.

To improve your credit score, use credit wisely and consistently. Always pay on time. Payment history is key to your credit score²⁶. Keep your credit use under 30% to help your score²⁶.

As you improve your credit, you might get better card offers. Some cards, like the Petal 2 Visa Credit Card, offer more cash back rewards for responsible use²⁸.

The Impact of Credit Improvement

Improving your credit score can save you a lot on different loans:

• Mortgage savings: Up to $16,677
• Credit card savings: Lower APRs
• Auto loan savings: Lower interest rates
• Personal loan savings: Better terms

These savings can reduce your monthly payments by $92²⁷. Over time, you could save tens of thousands of dollars on interest and fees.

Fixing your credit takes time. It took Kara Stevens seven years to get her score from the low 600s to an excellent 766²⁸. Stay patient, keep up good credit habits, and you’ll see better financial options and health.

Credit Card Issuers That Cater to Fair Credit

Many credit card companies have products for people with fair credit. These cards help build or improve credit scores. Let’s look at some top companies and what they offer for fair credit seekers.

Capital One

Capital One is a top choice for those with fair credit. Their Platinum Credit Card is great, needing a fair credit score (300-669) to get it. It has no annual fee and a variable APR of 29.99%, making it easy for many to get²⁹.

Discover

Discover has the Discover it Secured Credit Card for building credit. It offers cash back rewards and can lead to an unsecured card with good use. This card helps improve your chances of getting approved over time.

Credit One Bank

Credit One Bank focuses on cards for fair to poor credit. They have different rewards and fees to fit various financial needs. These cards can help you move to better credit and access more premium options.

Fair credit cards usually have higher APRs than prime credit cards. But, they offer great chances to improve your credit. On average, people with fair credit see big improvements in their scores over time³⁰.

Remember, getting a fair credit card is not guaranteed. It’s important to compare options, understand the terms, and pick a card that fits your financial goals and spending. With careful use, these cards can be key in your journey to better credit.

Alternative Options for Building Credit

Building credit doesn’t need a traditional credit card. For those wanting to improve their score, there are other ways that work well. Becoming an authorized user on someone else’s card is a good choice. It lets you enjoy their good credit without having to pay back the money³¹.

Credit-builder loans are also a solid option for fixing credit. These loans, usually between $300 and $1,000, help you build credit while saving money³². The money you borrow is kept in a savings account until you pay it all back. This ensures you don’t spend more than you have.

Reporting rent and utility payments to credit agencies can also boost your score. Many landlords and utility companies now offer this service. It shows you’re good with money³¹³². Some fintech companies have created products that don’t need a traditional credit check. This makes it easier for people with little credit history to build credit.

Remember, your payment history is 35% of your FICO score. So, making payments on time is key for building credit³³. By trying these alternatives, you can find the best way to improve your credit score and reach your financial goals.

FAQ

What is considered a fair credit score?

A fair credit score is between 580 and 669 on the FICO scale.

What are the benefits of credit cards for fair credit?

These cards help improve your credit score, offer rewards, and build credit. They report to major credit bureaus, helping you build a good credit history.

What are some top credit cards for fair credit?

Great choices include the Capital One QuicksilverOne Cash Rewards Credit Card, Upgrade Cash Rewards Visa®, and Capital One Platinum Credit Card. They’re perfect for fair credit and help improve your credit.

What features should I look for in a fair credit card?

Look for cards that report to major credit bureaus, have low or no fees, and offer free credit score access. Also, check for rewards programs and the chance for credit limit increases.

How can I choose the right credit card for fair credit?

Think about how you spend to get the most rewards. Compare fees, APRs, and rewards across cards. Use prequalification options to check your chances without hurting your credit score.

How can I build credit with a fair credit card?

Pay on time, keep your credit use under 30%, and have a mix of credit types. Some cards offer tools to help build your credit.

What types of rewards programs are available for fair credit cards?

You can get cash back rewards of 1% to 2% on purchases. Some cards offer points or miles programs. Introductory bonuses are smaller than for better credit cards.

What should I consider when evaluating a credit card for fair credit?

Look at annual fees, APRs, how they report to credit bureaus, and if they increase credit limits. Choose cards with low fees and clear terms.

What’s the difference between secured and unsecured credit cards for fair credit?

Secured cards need a deposit equal to the credit limit. Unsecured cards don’t require a deposit but might have higher fees or APRs. Both can help build credit when used right.

How can I improve my credit score with responsible card use?

Pay on time, keep your credit use low, and check your credit report often. Some cards offer free credit score access and tools to help you.

What are some common mistakes to avoid with fair credit cards?

Don’t use all your credit, miss payments, or apply for many cards quickly. Avoid high-fee cards that don’t offer much in return.

How can I transition from fair to good credit?

Use your card wisely to slowly improve your credit score. As your score gets better, you might get better card offers or higher credit limits.

What credit card issuers cater to fair credit consumers?

Companies like Capital One, Discover, and Credit One Bank offer cards for fair to poor credit. They have various rewards and fees.

What are some alternative options for building credit?

You can be an authorized user, use a credit-builder loan, or look into rent and utility reporting services. Some companies offer new ways to build credit.

Source Links

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