Prequalified credit cards for bad credit can help you get a card, improve your credit score, and build your credit history. Without damaging your credit score, prequalification gives you a reasonable idea of whether you’ll be approved for a credit card.
Let’s take a look at five cards that offer applicants the ability to see their chances of approval before submitting an application.
The following five cards specialize in providing credit to consumers with less-than-perfect (cardspeak for “bad”) credit. This group is a mix of secured and unsecured cards.
Issuers of secured cards can assume the risk of approving bad credit applicants by requiring a cash deposit, whereas unsecured cards must depend on limiting credit lines and charging one or more fees. All five prequalify applicants to reduce unnecessary hard credit inquiries that can hurt your credit score.
BAD CREDIT RATING
No annual fee, and all the credit building benefits with responsible card use
Unlike a prepaid card, it builds credit when used responsibly, with regular reporting to the 3 major credit bureaus
Access to an authorized bank account is required to make your $49, $99 or $200 refundable security deposit
Make the minimum required security deposit and you’ll get an initial credit line of $200. Plus, deposit more money before your account opens to get a higher credit line
Get access to a higher credit line after making your first 5 monthly payments on time with no additional deposit needed
Easily manage your account 24/7 with online access, by phone or using our mobile app
You can prequalify for the Capital One® Secured Mastercard® in about a minute by filling out a short form. Simply fill in your name, address, Social Security number, desired card benefits, and credit level (excellent, average, or rebuilding).
Capital One may then offer you the most appropriate credit cards, including the Capital One® Secured Mastercard®. This card requires a security deposit of between $49 and $200 that gets you a minimum credit line of $200. You can make a larger deposit to secure a higher credit line, up to $1,000. The card charges no annual fee.
BAD CREDIT RATING
No Annual Fee, earn cash back, and build your credit with responsible use.
It’s a real credit card. You can build a credit history with the three major credit bureaus. Generally, debit and prepaid cards can’t help you build a credit history.
Establish your credit line with your tax return by providing a refundable security deposit of at least $200 after being approved. Bank information must be provided when submitting your deposit.
Automatic reviews starting at 8 months to see if we can transition you to an unsecured line of credit and return your deposit.
Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. Plus, earn unlimited 1% cash back on all other purchases – automatically.
Get 100% U.S. based customer service & get your free Credit Scorecard with your FICO® Credit Score
10.99% for 6 months
The Discover it® Secured card collects prequalification information that includes your name, address, age, Social Security number, job/student status, annual gross income, housing status and payments, and bank accounts. Discover will perform a soft pull of your credit report that won’t hurt your credit. It then may invite you to apply one of its cards, including Discover it® Secured.
The card requires a security deposit of $200 to $2,500 and offers cash back rewards.
BAD CREDIT RATING
Prequalify for a card today and it will not impact your credit score
Less than perfect credit is okay
Mobile account access at any time
Protection from fraud if your card is stolen
Account history is reported to the three major credit bureaus in the U.S.
*Dependent on credit worthiness
$35 – $99
Bad, Poor Credit
You may obtain a Milestone® Mastercard® by completing a prequalification form that is almost identical to its application form. The difference is that the issuer performs a soft-pull of your credit report for prequalification and a hard pull for applications.
You’ll provide your name, address, Social Security number, date of birth, and phone number. The application also obtains your monthly income and expenses. If you don’t prequalify for the Milestone® Gold Mastercard®, you may be offered a credit card from another issuer.
BAD CREDIT RATING
Pre-qualify for a card today and it will not impact your credit score
Less than perfect credit is okay
Mobile account access at any time
Fraud protection for stolen or lost cards
Account history is reported to the three major credit bureaus in the U.S.
$0 – $99
Bad, Poor Credit
The Indigo® Mastercard® can prequalify you in 60 seconds with no impact on your credit score. Just provide your name, address, date of birth, Social Security number, email address, and phone number on the prequalification form.
Based on your prequalification results, you may be offered to apply for the Indigo® Platinum Mastercard® or a card from another bank. Your credit profile will determine your annual fee.
BAD CREDIT RATING
Seeing if you Pre-Qualify is fast, easy, and secure
Get 1% cash back rewards on eligible purchase, terms apply
Rewards post automatically to your account each month
Automatic reviews for credit line increase opportunities
With $0 Fraud Liability, you won’t be responsible for unauthorized charges
Pick a card that fits your style. Multiple card designs are available, a fee may apply
19.49% to 25.49% Variable
$0 – $99
The Credit One® Unsecured Platinum Visa® provides a prequalification form that collects your name, address, date of birth, Social Security number, monthly income, email address, and phone number. If you prequalify, you’ll fill out an application form for this card or for another offer of credit.
This card is one of two on this list that provides cash back, as well as access to your credit score and report. You may be charged an annual fee.
Secured credit cards are among the easiest to obtain when you have a bad credit score. That’s only natural since you must deposit cash into a special account to collateralize the card’s credit limit.
The card issuer will use your deposit if you miss a payment or go over your credit limit. It’s a win-win proposition, but only if you have the necessary cash available for a deposit.
In this review, the Capital One® Secured Mastercard® is our top choice, and it is a secured card. The required security deposit is $49, $99, or $200 for an initial credit limit of $200. The lower deposit requirements are generally not available to applicants with bad credit.
We also like the Discover it® Secured card, which has a minimum deposit and credit line of $200. The maximum credit line, $2,500, is determined by your income and ability to pay. Your credit line must be secured dollar-for-dollar by your deposit.
Prequalification is a good idea for folks with bad credit, as it lets you know in advance whether you should bother to apply for a specific credit card. Prequalification differs from the application process in at least four ways:
The information requested for prequalification is usually a subset of that required for the application.
The issuer performs a soft pull of your credit report for prequalification but does a hard pull when you submit your application. Therefore, prequalification does not hurt your credit score whereas submitting an application may.
Prequalification does not guarantee your subsequent application will be approved.
Many credit cards will offer you alternative cards based upon your prequalification information. This is not necessarily standard practice when you apply for a particular card.
If you prequalify for a card, the issuer may transfer the information to its application form and request any additional information it requires. Even if you are prequalified, you are not under obligation to apply for the card, and the issuer is not required to approve your application.
The five card issuers in this review provide simple prequalification or preapproval forms for you to complete. The typical information requested deals with your identity and residence.
Some issuers will also ask about your gross income and expenses, while others postpone asking for these data items until you fill out the application form.
When you send in your prequalification form, the issuer will use some information from your credit report that it obtains via a soft pull from one of the major credit bureaus. By requesting prequalification, you authorize the issuer obtaining the information it requires from your credit report and other sources.
It may seem obvious to some that preapproval would be better than prequalification, but a lot depends on how the card issuer uses these terms. For example, Discover uses the term “preapprove” the way other issuers use “prequalify.”
The truth is that any “pre” word is not to be confused with “approval,” which can come only when you fill out an application form, not a prequalification or preapproval form.
“Preapproval” is also used in another context — when you receive mailed offers for preapproved credit cards. Generally, this means you can enter a special approval code when you fill out the card application form.
You may receive an approval code you can use to accept a preapproved card offer.
Preapproved offers have some benefits. They use soft inquiries, so you are not penalized when issuers send them out. In addition, these offers may provide you with better product choices, terms, and rates.
Our list of prequalified credit cards for bad credit evaluated the cards designated for credit scores below 579 (the “bad” range under the FICO credit scoring model) that offer prequalification before submitting an official application. This helps prospective applicants get an idea of their chances of approval before undergoing a hard credit pull and possible denial.
CardRates’ reviews undergo a thorough editorial integrity process to ensure that content is not compromised by advertiser influence.
After the current U.S. Congress was sworn in, a predictable chorus of merchants, lobbyists, and lawmakers demanded new interchange price caps and other government mandates to decrease credit card interchange fees for merchants. The tired attacks on credit cards are an easy narrative that focuses almost exclusively on the cost side of the ledger, while completely ignoring the cards’ important role in the economy and the regressive effects of interchange regulation.
To lawmakers blindly acting on behalf of retailers, regulation is a brilliant idea—regardless of how it affects their constituents. For decades, they have promised these interventions would eventually benefit consumers. But the lessons from the Durbin Amendment in the United States and price cap regulation in Australia is clear. Although some policymakers bemoan the current economic model, arbitrarily “cutting” rates for the sake of cuts completely ignores the economic reality that as billions of dollars move to merchants, billions are lost by consumers.
For the uninitiated, let’s break down what credit interchange funds: 1) the cost of fraud; 2) more than $40 billion in consumers rewards; 3) the cost of nonpayment by consumers, which is typically 4% of revolving credit; 4) more than $300 billion in credit floats to U.S. consumers; and 5) drastically higher “ticket lift” for merchants.
These are just some of the benefits. If costs were all that mattered, American Express wouldn’t exist. Until recently, it was by far the most expensive U.S. network. Yet, merchants still took AmEx because they knew the average AmEx “swipe” was around $140, far more than Visa and Mastercard.
Put simply, for a few basis points, interchange functions as a small insurance policy to safeguard retailers from the threat of fraud and nonpayment by consumers. Consider the amount of ink spilled on interchange when no one mentions that the chargeoff rate for issuing banks on bad credit card debt exceeds credit interchange.
Looking abroad, interchange opponents cite Australia, which halved interchange fees nearly 20 years ago, as a glowing example of how to regulate credit cards. In truth, Australia’s regulations have harmed consumers, reduced their options, and forced Australians to pay more for less appealing credit card products.
First, the cost of a basic credit card is $60 USD in many Australian banks. How many millions of Americans would lose access to credit if the annual cost went from $0 to $60? Can you imagine the consumer outrage?
In a two-sided market like credit cards, any regulated shift to one side acts a massive tax on the other. For Australians, the new tax fell on cardholders. There, annual fees for standard cards rose by nearly 25%, according to an analysis by global consulting firm CRA International. Fees for rewards cards skyrocketed by as much as 77%.
Many no-fee credit cards were no longer financially viable. As a result, they were pulled from the market, leaving lower income Australians, as well as young people working to establish credit, with few viable options in the credit card market.
Even the benefits that lead many people to sign up for credit cards in the first place have been substantially diluted in Australia because of the reduction of interchange fees. In fact, the value of rewards points fell by approximately 23% after the country cut interchange fees.
Efforts to add interchange price caps would have a similar effect here in the U.S. A 50% cut would amount to a $40 billion to $50 billion wealth transfer from consumers and issuers to merchants. For the 20 million or so financially marginalized Americans, what will their access to credit be when issuers find a $50 billion hole in their balance sheets?
The average American generates $167 per year in rewards, according to the Consumer Financial Protection Bureau. Perks like airline miles, hotel points, and cashback rewards would be decimated and would likely be just the province of the rich after regulation. Many middle-class consumers could say goodbye to family vacations booked at almost no cost thanks to credit card rewards.
As the travel industry and retailers fight to bounce back from the impact of the pandemic, slashing consumer rewards and reducing the attractiveness of already-fragile businesses is the last thing lawmakers and regulators in Washington should undertake.
Proposals to follow Australia’s misguided lead in capping interchange may allow retailers to snatch a few extra basis points, but the consequences would be disastrous for consumers. Cards would simply be less valuable and more expensive for Americans, and millions of consumers would lose access to credit. University of Pennsylvania Professor Natasha Sarin estimates debit price caps alone cost consumers $3 billion. How much more would consumers have to pay under Durbin 2.0?
Members of Congress and other leaders should learn from Australia and Durbin 1.0 to avoid making the same mistake twice.
—Drew Johnson is a senior fellow at the National Center for Public Policy Research, Washington, D.C.
More than ever before, your debt and credit records can negatively impact you or your family’s life if left unmanaged. Sadly, many Americans feel entirely helpless about their credit score’s present state and the steps they need to take to fix a less-than-perfect score. This is where Michael Carrington, founder of Tier 1 Credit Specialist, comes in. Michael is determined to offer thousands of Americans an educated, informed approach towards credit restoration.
Michael understands the plight that having a bad credit score can bring into your life. His first financial industry job was working as a home mortgage loan analyst for one of the nation’s largest lenders. Early on, he had to work a grueling schedule which included several jobs seven days a week while putting in almost 12-hour days to make $5,000 monthly to get by barely.
“I was tired of living a mediocre life and was determined to increase the value that I can offer others through my knowledge of the finance industry – I started reading all of the necessary books, networking with industry professionals, and investing in mentorship,” shares Michael Carrington. “I got my break when I was able to grow a seven-figure credit repair and funding organization that is flexible enough to address the financial needs of thousands of Americans.”
With his vast experience in the business world, establishing himself as a well-respected business leader, Michael Carrington felt he had the power to help millions of Americas in restoring their credit. Michael learned the FICO system, stayed up to date on the Fair Credit Reporting Act (FCRA), found ways to improve his credit score, and started showing others.
The Tier 1 Credit Specialist uses a tested and proven approach to educate their clients on everything credit scores. Michael is leveraging his experience as a home mortgage professional, marketing executive, and global business coach to inform his clients. He and his team take their time to carefully go through their client’s credit records as they try to find the root of their problem and find suitable financial solutions.
The company is changing lives all over America as it helps families and individuals to repair their credit scores, gain access to lower interest rates on loans and get better jobs. What Tier 1 Credit Specialists is offering many Americans is a chance at financial freedom.
Michael Carrington has repaired over $8 million in debt write-ups and has helped fund American’s with over $4 million through thousands of fixed reports. “I credit our success to being people-focused,” he often says. “The amount of success that we create is going to be in direct proportion to the amount of value that we provide people – not just our customers – people.”
Because of its ‘people-focused goals, the Tier 1 Credit Specialist is determined to help millions of Americans achieve financial literacy. It is currently receiving raving reviews from clients who are completely happy with the credit repair solutions that the company has provided them.
Today, Michael Carrington is continuing with a new initiative to serve more Americans who suffer from bad credit due to little or no access to affordable resources for repair.
The Tier 1 Credit Socialist brand is changing the outlook of many families across America. To do this, the company has created an affiliate system that will provide more people with ways of earning during these tough economic times.
As a well-respected international business leader and entrepreneur with numerous achievements to his name Michael Carrington aims to help millions of Americans achieve the financial freedom, he is experiencing today. Tier 1 Credit Socialist is one of the most effective credit repair brands on the market right now, and they have no plans for slowing down in 2021!
Learn more about Michael Carrington by visiting his Instagram account or checking out the Tier 1 Credit Specialist website.
When it comes to personal finance, nothing is guaranteed. That goes double for credit. That’s why, no matter how perfect your credit or how many times you’ve applied for a new credit card, there’s always that moment of doubt while you wait for a decision.
Issuing banks look at a wide range of factors when making a decision — and your credit score is only one of them. They look at your entire credit history, and consider things like your income and even your history with the bank itself.
For example, if you defaulted on a credit card with a given bank 15 years ago, that mistake is likely long gone from your credit reports. To you and the three major credit bureaus, it is ancient history. But banks are like elephants — they never forget. And that mistake could be enough to stop your approval.
But does it go the other way, too? Does having a bank account that’s in good standing with an issuer make you more likely to get approved? While there’s no clear-cut answer, there are a few cases when it could help.
A good relationship may weigh in your favor
Credit card issuers rarely come right out and say much about their approval processes, so we often have to rely on anecdotal evidence to get an idea of what works. That said, you can find a number of stories of folks who have been approved for a credit card they were previously denied for after they opened a savings or checking account with the issuer.
These types of stories are more common at the extreme ends of the card range. If you have a borderline bad credit score, for instance, having a long, positive banking history with the issuer — like no overdrafts or other problems — may weigh in your favor when applying for a credit card. That’s because the bank is able to see that you have regular income and don’t overspend.
Similarly, a healthy savings or investment account with a bank could be a helpful factor when applying for a high-end rewards credit card. This allows the bank to see that you can afford its product and that you have the type of funds required to put some serious spend on it.
Having a good banking relationship with an issuer can be particularly helpful when the economy is questionable and banks are tightening their proverbial pursestrings. When trying to minimize risk, going with applicants you’ve known for years simply makes more sense than starting fresh with a stranger.
Some banks provide targeted offers
Another way having a previous banking relationship with an issuer can help is when you can receive targeted credit card offers. These are sort of like invitations to apply for a card that the bank thinks will be a good fit for you. While approval for targeted offers is still not guaranteed, some types of targeted offers can be almost as good.
For example, the only confirmed way to get around Chase’s 5/24 rule (which is that any card application will be automatically denied if you’ve opened five or more cards in the last 24 months) is to receive a special “just for you” offer through your online Chase account. When these offers show up — they’re marked with a special black star — they will generally lead to an approval, no matter what your current 5/24 status.
Credit unions require membership
For the most part, you aren’t usually required to have a bank account with a particular issuer to get a credit card with that bank. However, there is one big exception: credit unions. Due to the different structure of a credit union vs. a bank, credit unions only offer their products to current members of the credit union.
To become a member, you need to actually have a stake in that credit union. In most cases, this is done by opening a savings account and maintaining a small balance — $5 is a common minimum.
You can only apply for a credit union credit card once you’ve joined, so a bank account is an actual requirement in this case. That said, your chances of being approved once you’re a member aren’t necessarily impacted by how much money you have in the account.
In general, while having a bank account with an issuer may be helpful in some cases, it’s not a cure-all for bad credit. Your credit history will always have more impact than your banking history when it comes to getting approved for a credit card.