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Best FHA Lenders | Low Credit & Low Down Payment Loans



Compare top FHA lenders

FHA loans are popular thanks to their lenient guidelines. Home buyers can qualify with a credit score of just 580 and 3.5% down.

And it’s easy to find FHA financing; the majority of lenders are FHA-approved. But that doesn’t mean you should go with just any FHA lender.

As with other loan types, FHA loan rates and requirements can vary a lot from one company to the next. So you’ll want to compare a few different FHA-approved lenders to find your best deal.

Check your FHA loan rates (Jan 4th, 2021)

FHA LenderMin. Credit Score RequirementBest Features*
Homepoint Financial580Lowest average rates and fees
Freedom Mortgage600Low average rates
CMG Financial600Low average rates, top-rated service
New American Funding580Average rates, top-rated service
Finance Of America600Average rates 
Fairway Independent580Top-rated service, low credit allowed
CrossCountry580Low credit allowed
PrimeLending580Low credit allowed
U.S. BankNot ListedLower average loan costs

*Average rate and fee analysis based on self-reported data lenders are required to file under the Home Mortgage Disclosure Act. Actual rates and fees will vary by customer

Check your FHA loan rates (Jan 4th, 2021)

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The 9 best FHA lenders for 2021

FHA loans are known for having easier requirements than other mortgages. But that’s not the case with every lender.

For instance, some FHA-approved lenders allow credit scores as low as 500 (with a 10% down payment) while others set their minimum credit score at 620 or even higher.

Similarly, some lenders offer lower mortgage rates than others.

That means it’s important to shop around for an FHA loan — doubly so if you have bad credit or another issue that makes it harder to qualify.

So check with the lenders on this list. But also consider local banks and credit unions that might take a more hands-on approach if you’re having trouble qualifying.

Verify your FHA loan eligibility (Jan 4th, 2021)

1. Homepoint Financial

How is Homepoint listed as our No. 1 FHA lender when it was founded only in 2015? Mainly because, in 2019, it had the lowest average FHA mortgage rates of any lender on our list — and the third-lowest loan costs.

But it’s also a good all-rounder, scoring respectably for customer complaints and online reviews. Here are some other things you need to know:

  • Licensed to make FHA loans in all 50 states
  • Good online application and follow-through processes after initial telephone contact
  • Has a mobile app for homeowners
  • Has an A- Better Business Bureau (BBB) rating
  • Very few physical branches

Some customers have reported minor snags in the application process, and difficulty in resolving issues.

But, if you want to pay the least you can for your FHA loan, you’ll want Homepoint on your shortlist.

2. Freedom Mortgage

Freedom Mortgage rates for FHA loans are nearly as low as Homepoint’s. So they’re the second-lowest on our list. However, its average closing costs on these loans were midrange in 2019.

Freedom was also the biggest FHA lender on our list in 2019, originating 129,000 FHA loans.

Inside Mortgage Finance named it the biggest FHA lender in America for the first three quarters of 2020.

That comes with pros and cons. Freedom Mortgage has unrivaled experience in creating FHA mortgages. But it also gets more customer complaints filed with the Consumer Financial Protection Bureau (even allowing for volume) than our other top lenders, except U.S. Bank.

Still, there are lots of positives, most importantly:

  • Very low mortgage rates on average
  • Choice of how to engage: online, by phone, or through a limited branch network
  • Operates in all 50 states
  • Considers “nontraditional credit histories,” meaning it will look at on-time payments for rent and utilities if you have a thin credit file
  • Happy to work with down payment assistance programs
  • Has a B+ BBB rating

All in all, Freedom Mortgage is another very strong contender for your short list.

Check Freedom Mortgage rates today, January 4, 2021

3. CMG Financial

CMG Financial had the third-lowest average FHA rates in our survey. And it scored better than our top two for online reviews and customer complaints to the CFPB.

However, its average FHA loan fees were higher than most on our list. That means more expensive closing costs.

Other considerations include:

  • Has an A+ BBB rating
  • Licensed in most but not all states
  • Handy app lets you monitor and advance your FHA loan application
  • Named one of 2020 HousingWire Tech Trendsetters

Overall CMG Financial offers an attractive combination of low rates and superior customer care.

4. New American Funding 

New American Funding says it views mortgage applications on a case-by-case basis.

In other words, it doesn’t just tick boxes, but is willing to look deeper into the reasons why your application may be borderline.

This approach could be helpful to many wanting an FHA loan — especially those with past red marks on their credit report.

You also need to know:

  • New American Funding operates in 48 states, but not New York or Hawaii
  • Has an A+ BBB rating
  • Excellent technology with the option of a wholly digital experience
  • More than 200 branches in 34 states for those who prefer face-to-face encounters
  • Few complaints to the Consumer Financial Protection Bureau
  • Second-best for online reviews

The main downside is higher-than-average loan costs. But for many borrowers that could be a price worth paying.

Check New American Funding mortgage rates today, January 4, 2021

5. Finance Of America 

Finance of America offers competitive FHA loan rates, falling right at the average among our 9 best FHA lenders. But its loan costs were just the tiniest bit higher than New American Funding.

However, with Finance of America, you can likely expect a more personal experience. That’s because you’ll be working one-on-one with an adviser throughout the process, often by phone and email.

Here are the basics:

  • Finance of America operates in all 50 states
  • Has an A+ BBB rating
  • Has 400+ local adviser branches
  • Very few customer complaints to the CFPB

Finance of America seems to offer good value for your money, and a great choice for those who want person-to-person service.

6. Fairway Independent Mortgage

Fairway Independent Mortgage Co. is the lowest in our survey for average FHA loan costs. But its rates are competitive rather than ultra-low.

Fairway also has the fewest customer complaints filed with the CFPB and the second-highest score for online customer reviews. So it clearly deserves its spot as one of the best FHA lenders this year.

Here are some other considerations:

  • 500+ branches, well spread across 48 states (operates in all 50 states)
  • Slick technologies that let you finish your application within 10 minutes and do the whole process online if you wish
  • Has an A+ BBB rating

We like Fairway’s excellent customer service and reckon it’s a shoo-in for most short lists.

7. CrossCountry Mortgage

If speed is important to you, CrossCountry may be your best choice. This company reckons it’s able to close most loans in 21 days.

However, a more complicated underwriting process can often slow loan approval. So if you have issues in your credit history or another problem that needs to be explained, you should expect your loan approval to take longer than advertised.

CrossCountry also encourages strong personal relationships between borrowers and loan officers. So you’ll have someone to help you through the loan process.

  • Operates in all 50 states with physical branches in 37
  • Has an A+ BBB rating
  • Good scores from online customer reviews. And a small number of complaints to the federal regulator
  • You need to speak to a loan officer before you can get a quote

All in all this is another excellent lender worth checking out for your FHA loan.

Check CrossCountry mortgage rates today, January 4, 2021

8. PrimeLending

PrimeLending won the No. 2 spot in our review of the 8 best mortgage lenders for first-time homebuyers. We liked that it works well with state and local down payment assistance programs.

PrimeLending also has its own form of assistance: the NeighborhoodEdge® Closing Cost Assistance program, which offers those purchasing in low- or moderate-income neighborhoods up to $2,000.

If you qualify for this aid, you may not mind PrimeLending’s slightly higher-than-average mortgage rates. Especially as its loan costs are below average for our nine lenders.

Other key information includes:

  • PrimeLending operates in all 50 states
  • Has an A+ BBB rating
  • Good for those who like to work online, but also offers plenty of human support
  • E-closing (online closing) option

There’s an awful lot to like about PrimeLending. And, especially if you’re in line for that $2,000 help toward closing costs, it may well be your first choice.

9. U.S. Bank

U.S. Bank is by far the biggest (and the most long-established) organization on our list. You probably either love or hate big banks. But either way, give this one a chance.

U.S. Bank has the second-lowest loan costs on our list. As importantly, it was a top-5 lender on the J.D. Power 2020 U.S. Primary Mortgage Origination Satisfaction Study, which is a real achievement.

Aside from that, U.S. Bank:

  • Operates in all 50 states
  • Has a 3,000+ branch network for those who prefer face-to-face encounters
  • Offers good self-service online technologies
  • Has an A+ BBB rating

If you’re already a U.S. bank customer, you get the added benefit of keeping all your finances under one roof.

Check your FHA loan rates today (Jan 4th, 2021)

FHA home loan requirements 

Thanks to their backing from the Federal Housing Administration, FHA loans are typically easier to get approved for than other loan types — especially if your credit history isn’t as strong as you’d like.

To qualify for one of these loans, most FHA-approved lenders require:

  • A minimum credit score of 580. Some may approve you with a 500-579 FICO score, but only providing you have a 10% down payment. These are easier credit requirements than most other mortgages
  • A low down payment of at least 3.5% if your credit score is 580 or higher
  • Maximum debt-to-income ratio (DTI) of 50%. This means your new mortgage payments, combined with ongoing debts like credit cards, auto loans, and student loans, can’t exceed half of your monthly income before tax. Check out Simple mortgage definitions: Debt-to-Income (DTI) for more information
  • Solid employment history showing a reliable income that’s likely to continue for at least 3 years after the loan closes
  • A relatively clean credit history that’s free of foreclosures going back three years

In addition, you must be purchasing a home you plan to live in as your primary residence. That’s often a single-family home, though the Federal Housing Administration will also insure 2-, 3-, and 4-unit properties as long as the owner lives in one of the units full-time.

Finally, the property you’re buying or refinancing must be within current FHA loan limits.

In most places, FHA’s maximum loan amount is $356,362 for a single-family home. But multifamily loan limits can be as high as $685,400 for a 4-unit property.

If you want to buy in an area where average home prices are high, FHA’s loan limits may be higher, too

Verify your FHA loan eligibility (Jan 4th, 2021)

FHA mortgage rates 

If you look at interest rates alone, FHA loans are very competitive. They often have similar or even lower interest rates compared to conventional loans, which are ones not backed by the federal government.

But interest rates aren’t the only consideration. Because FHA loans also require you to pay for mortgage insurance. This takes the form of:

  1. An upfront mortgage insurance premium equal to 1.75% of the loan amount, which most borrowers include on their loan balance
  2. An annual mortgage insurance premium equal to 0.85% of the loan amount, which is paid in 12 monthly installments

The annual mortgage insurance rate of 0.85% is effectively an increase on your mortgage rate. It increases your APR — annual percentage rate — which accounts for loan fees as well as interest.

For example, if current FHA rates are at 2.75%, your ‘effective rate’ with mortgage insurance included might be closer to 3.6%.

Can I get rid of FHA mortgage insurance?

With an FHA loan, you usually have to keep paying for mortgage insurance premium (MIP) until you either sell the home or refinance.

The only exception is for FHA borrowers who make a down payment of 10% or more. In this case, MIP payments last 11 years.

Understandably, many borrowers with FHA loans hate mortgage insurance. But they live with it because they know they typically make way more from rising home prices than they pay in premiums.

In this way, mortgage insurance actually offers a great return on investment.

Pros and cons of FHA financing 

Pros of FHA loans

The biggest advantages of the FHA loan program are its lenient credit guidelines and low down payment requirement.

You may be approved for a home purchase loan even if you have a:

  • Low FICO credit score (580+)
  • Low down payment (3.5%)
  • High existing debts and monthly financial commitments (DTI of up to 50%)

If these are big factors for you, an FHA loan may be the only way to realize your homeownership dreams. That’s why they’re so popular among first-time homebuyers.

Cons of FHA loans

FHA loans really have only one major drawback. And that’s the cost of the mortgage insurance we mentioned earlier.

You have to make sure you can comfortably afford all your homeownership costs before you sign for one of these loans. But you can see them as a stepping stone.

Many home buyers expect to refinance out of an FHA loan and into a conventional mortgage with no PMI and lower payments later on.

That’s usually easy to do once your equity reaches 20% of your home’s value.

How to choose your best FHA lenders

There’s nothing magical about comparison shopping for a mortgage. It’s the same exercise you do when you want to buy a new car, TV, or washer. (But you can save way more when you shop for a home loan.)

First, research reputable lenders who are known for their bargains. You have a head start with 9 great FHA lenders identifed on this list.

Next, get a customized Loan Estimate from at least 3-5 of your preferred lenders. Choose the one with the lowest ‘price,’ which in this case means the most competitive FHA loan rate and closing costs for your situation.

Many borrowers can save thousands of dollars by shopping around for their mortgages. So it’s worth investing some time to find your best deal.

At the very least, get Loan Estimates from three lenders. But you increase your chances of making savings with every additional one.

Verify your new rate (Jan 4th, 2021)

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How long do offers last, and what if I have bad credit? We answer the most-asked mortgage questions



Forget the eyes – nowadays, it is our internet searches that provide a window into the soul.  

We often turn to search engines to ask the questions that are on our minds, whether we’re just looking for a quick answer or because it’s something we are embarrassed to ask in person. 

Now, Britons’ most common mortgage questions have been revealed, thanks to a new analysis of Google searches.  

Many of the mainstream lenders are able to offer a mortgage within 2-3 weeks of an application being submitted, according to the mortgage experts we spoke to

Many of the mainstream lenders are able to offer a mortgage within 2-3 weeks of an application being submitted, according to the mortgage experts we spoke to looked at search data from the last twelve months, and discovered that the most asked mortgage question, with 20,960 searches, was ‘How long does a mortgage application take?’

Britons also wanted to know how long a mortgage offer lasted for, how to get a mortgage with bad credit, what an interest only mortgage was, and what a lifetime mortgage was. 

Applying for a mortgage can sometimes be complicated, and there is often a lot of jargon to contend with – so it is not surprising that people search online for more information.

This is Money asked Mark Harris of mortgage broker SPF Private Clients, Nicholas Morrey of mortgage broker John Charcol and a spokesperson from the Mortgage Advice Bureau to help provide answers to the five most-asked questions.

How long does a mortgage application take?

The most common mortgage question on Google, this is particularly relevant at the moment given that some buyers are keen to complete before the stamp duty holiday ends on 31 March. 

But the answer depends on the type of mortgage application being submitted, according to Harris.

For example, a product transfer – where you stay with your current lender but move to a new deal – can take a matter of days, whilst a more complex mortgage application can take weeks.

‘Once the application is submitted, a lot depends on the lender and the complexity of the application – it may take anywhere between one day to two weeks for an initial assessment to take place,’  Harris said. 

If you’re self-employed or the mortgage valuation requires a surveyor to visit the property in person, then you are likely to face further delays. 

A firm mortgage offer will follow once your application has been fully reviewed and an acceptable valuation received.

The experts we spoke to said that typically, it would to take two to three weeks from application to offer – but the pandemic has meant that these timescales have been stretched. 

‘Unfortunately, during the Covid-19 pandemic, lenders have suffered from staff and resource issues and tasks are taking longer to complete,’ said Harris.

‘Also, given the effect on employment and income, lenders are scrutinising applications in greater depth to see how applicants have been affected.’ 

How long does a mortgage offer last?

In most cases mortgage offers last for six months, although some offers will only last for three months.

‘If the offer expires, lenders will sometimes agree to an extension – although this will sometimes require a re-assessment by the lender,’ said Morrey.

A typical mortgage offer will last for six months, but this can sometimes be extended

A typical mortgage offer will last for six months, but this can sometimes be extended

‘For example, the original deal may no longer be available, or a new valuation may be required, or the lender may wish to re-assess your income and outgoings.’

Where an application involves a new-build property, the offer may last longer – potentially up to 12 months, according to Harris.

‘Borrowers should be aware that some new builds have completion deadlines that may not coincide with offer expiry dates,’ he said.

How to get a mortgage with bad credit?

Some lenders will not offer mortgages to people with a history of bad credit, and this was something that Google searchers wanted to know how to get around. 

Lenders that are willing to do so often charge a higher interest rate, to reflect the increased level of risk.

‘When getting a mortgage with bad credit, you can expect to borrow less and to pay more in interest in comparison to someone who has an exemplary credit record,’ explained the spokesperson for the Mortgage Advice Bureau.

Having bad credit may mean you are not able to borrow as much on your mortgage

Having bad credit may mean you are not able to borrow as much on your mortgage

‘High street lenders are generally averse to dealing with those who have bad credit, which can make it pretty difficult.

‘When you apply for a mortgage, it can register on your credit file – and if you apply to a number of lenders to see if they will lend to you, it may be doing additional damage to your credit score.’

‘Your best option, according to Mortgage Advice Bureau, is to contact an established and experienced mortgage broker.

‘They will have access to contacts and deals that are exclusive and not available to the general public. The mortgage broker will carry out a ‘soft’ credit check first, so your inquiry doesn’t negatively impact your credit score.’ 

What is an interest-only mortgage?

Another common question on Google concerned interest-only mortgages. So what are they? 

When borrowing for a home, you can either opt for a repayment mortgage or an interest-only mortgage.

With a repayment mortgage, you will pay back a part of the loan, as well as the interest, each month until you eventually pay off the mortgage.

With an interest-only mortgage, you will only pay the interest each month, with the loan amount remaining the same.

‘It means your monthly payments will be lower but, at the end of the mortgage term, the full amount you borrow is still outstanding and you have to pay the lender back everything at that time,’ said Morrey.

‘When applying for an interest-only loan, the borrower must demonstrate that there is a clear and credible strategy in place to repay the capital,’ added Harris.

What is a lifetime mortgage?

A lifetime mortgage is a mortgage secured on your home, with the loan only being repaid when you pass away, go into long-term care or sell the property.

Two examples of this are retirement interest-only mortgages and equity release mortgages.

Equity release allows you to access some of the equity in your home via a lifetime mortgage

Equity release allows you to access some of the equity in your home via a lifetime mortgage

‘Lifetime mortgages often have fixed rates of interest, and in the case of equity release mortgages, the fixed rate is for life and not just two or five years,’ explained Morrey.

He added: ‘They should not be confused with lifetime tracker mortgages, which track a specific index such as the Bank of England base rate – these will likely have an end date and won’t be for a ‘lifetime’ in itself.’

There are strict lending criteria, with the amount you can you borrow depending on your age.

‘Seeking expert financial and legal advice is crucial for this type of mortgage,’ said Harris.

‘An adviser covering both equity release and standard mortgages would be most useful as they can assess the most suitable route forward.’

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.

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What is a Subprime Mortgage?



What is a subprime mortgage? If you’re asking this question, chances are good you’re either trying to borrow for a home with poor credit or you’ve been offered a loan you’re concerned is a subprime loan. We’ll explain the answer to the question “what is a subprime mortgage?” and discuss some of the risks and alternatives.

What is a subprime mortgage?

Prime loans usually offer competitive interest rates to well-qualified borrowers. A subprime mortgage is similar to a conventional mortgage, except it has a higher interest rate. Subprime loans are geared toward borrowers with bad credit who can’t qualify for a prime mortgage at the best rates. Lenders take a bigger risk with subprime loans, so they charge substantially higher rates due to the borrower’s poor credit history.

If you have a credit score below 620, you may not be able to qualify for a prime mortgage, but you might get a subprime mortgage.

Types of subprime mortgages

There are multiple types of subprime mortgage loans. However, one particular type of loan — an adjustable-rate mortgage — is especially common for subprime mortgages.

Adjustable-rate mortgages

Many subprime mortgages are adjustable-rate mortgages, or ARMs. The introductory rate on an ARM is fixed for a limited time. For example, a 5/1 ARM provides a fixed rate for five years. After that, the rate adjusts based on a financial index.

That means your interest rate may go down — but it could go up, too. ARMs carry more risk than fixed rate loans. If interest rates rise, monthly payments could increase. If you take out an adjustable loan, find out how high your payment could go. Don’t assume you’ll always be able to refinance or sell your home before it adjusts.

Fixed-rate mortgages

With fixed-rate subprime mortgages, the interest rate remains the same for the entire repayment period. Since the rate doesn’t change, payments don’t change.

The important question is, what is a subprime mortgage interest rate you’d qualify for? You need to make sure the rate is reasonable and that monthly payments are affordable.

Shop and compare rates from multiple mortgage lenders for poor credit to find the best subprime loan rates. And use a mortgage calculator to see how much your monthly payment would be for any loan you’re considering.

Interest-only mortgages

Interest-only mortgages allow you to pay only interest for a limited time, such as the first five years. This makes monthly payments more affordable, but you don’t make progress in reducing your loan principal.

At the end of the initial period, you’ll begin paying both principal and interest. Your payments may rise substantially because you’ll have a shorter timeline to pay your loan off. If you took a 30-year mortgage and only paid interest for the first 10 years, you’d have just 20 years to pay off your entire principal balance.

Most interest-only loans are also structured as ARMs, so you take the added risk of rates going up and payments rising.

Dignity mortgages

Dignity mortgages are a specific type of subprime loan offered by some lenders. With this type of mortgage, you’ll initially have a high interest rate. But if you make on-time payments for a period of time, your interest rate will eventually be reduced to the prime rate.

Subprime mortgage risks

It’s important to also consider if you’re willing to take on the risk of this type of loan. Some of the biggest risks include:

  • Interest costs will be high: You will pay significantly more mortgage interest over time than if you took out a conventional mortgage.
  • Finding a lender may be difficult: Not all mortgage lenders offer loans to subprime borrowers. You could be limiting your potential loan options.
  • Payments could increase: If you choose an ARM, you face the risk of interest rates going up and payments rising.
  • Foreclosure is possible: If you don’t pay your subprime mortgage loan, your lender will foreclose. Your credit could be severely damaged.

Lenders are required under Dodd-Frank financial reform laws to conduct an “ability-to-repay” assessment. This ensures borrowers are capable of paying back their loans. These mandates can reduce the risk for borrowers. But the bottom line is buying a house with bad credit can create a host of complications.

Alternatives to subprime mortgages

You may be wondering if there are other options. The good news is that there are multiple solutions for borrowers with bad credit. Some of the best options include these government-back loans:

  • FHA loan: FHA lenders often work with borrowers with lower credit. FHA loans are available to borrowers with credit as low as 500 as long as they make a 10% down payment. Borrowers with scores of 580 or higher can get approved with a 3.5% down payment.
  • VA loan: A VA mortgage loan is available to eligible service members and veterans regardless of their poor credit history. The VA doesn’t set a minimum score, but some lenders do.

USDA loan: These allow you to purchase eligible homes in rural areas. More stringent underwriting is required to qualify borrowers with credit scores below 640. But it may still be possible to qualify.

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Indigo Platinum Mastercard Review | NextAdvisor with TIME



We want to help you make more informed decisions. Some links on this page — clearly marked — may take you to a partner website and may result in us earning a referral commission. For more information, see How We Make Money.

Indigo® Platinum Mastercard®

Indigo® Platinum Mastercard®

  • Intro bonus: No current offer
  • Annual fee: $0 – $99
  • Regular APR: 24.90%
  • Recommended credit score: 300-670 (Bad to Fair)

The Indigo Platinum Mastercard can help you build a better credit score (if you practice good credit habits) with monthly reporting to the three credit bureaus. Unlike many other options for building credit, this is an unsecured credit card, so it doesn’t require a cash deposit as collateral. But you may incur an annual fee, depending on your creditworthiness when you apply.

At a Glance

  • Monthly payment reporting to the three credit bureaus for people with limited credit history or poor credit
  • Annual fee of $0, $59, or $75 the first year, depending on your creditworthiness ($75 version charges a $99 annual fee after the first year)
  • Unsecured credit card with no security deposit required
  • Standard variable APR of 24.9% 


  • Available to individuals with no credit history or low credit scores

  • Unsecured credit card

  • Annual fee could be as low as $0 depending on your creditworthiness

  • Monthly payments report to all three credit bureaus


  • No rewards

  • Annual fees vary depending on creditworthiness, and you won’t know your fee until you apply

  • High variable APR

  • $300 credit limit

Additional Card Details

The Indigo Platinum Mastercard is geared toward people with “less than perfect credit” or minimal credit histories. Like other credit-building card options, it doesn’t offer a lot of perks.

You will get a few benefits, like online account access and reporting to all three credit bureaus (Equifax, Experian, and TransUnion). You can also choose from multiple card designs for no extra charge.

Prequalification is another benefit of the Indigo Platinum Mastercard. Prequalifying is a great way to gauge your approval odds and the terms of your offer without filling out a full application and undergoing a credit check, which can temporarily hurt your credit score. If you do choose to apply after pre-qualifying, you’ll still be subject to credit approval with a hard credit inquiry.

Should You Get this Card?

Many credit cards available to people with bad credit scores are secured credit cards that require a cash deposit as collateral. The Indigo Platinum Mastercard offers an alternative to secured cards for building better credit, but has its own drawbacks.

For one, your credit limit is capped at $300. If you’re approved for a version of this card with an annual fee, it’ll be automatically applied, which means your starting limit could be as low as $225. 

The annual fee itself is another drawback. The amount you’re charged will depend on your creditworthiness when you apply. If your approval comes with an annual fee, that $59 or $99 ($75 the first year) charge can quickly add up over time. Consider other cards with no annual fee (and even no annual fee secured credit cards) that may make better long-term options for building a healthier credit profile.

How to Use the Indigo Platinum Mastercard

Because the Indigo Platinum Mastercard doesn’t offer any rewards and your credit limit is just $300, you should use this credit card for the sole purpose of improving your credit score. Only make purchases you can afford to pay off when your statement is due, and pay your bill on time to avoid up to $40 in late fees and a penalty APR up to 29.9%. 

Pro Tip

Building a great credit score, whether you’re starting from no credit history or repairing damaged credit, requires a foundation of good credit habits your credit card can help establish — such as timely payments, low credit utilization, and paying off your balances in full each month.

The Indigo Platinum Mastercard’s low credit limit means you’ll need to be extra careful with your spending to improve your credit score. Using more than 30% of your available credit can hurt your credit utilization rate — one of the most influential factors in your credit score. With a credit limit of $300, that means you should keep your charges below $90.

The goal of a card like Indigo Platinum Mastercard is to, over time, improve your credit score enough to qualify for a better credit card. Use this card to establish and maintain the healthy credit habits (like timely payments in full, low utilization, and consistently paying down balances) that will improve your credit long-term, and help you qualify for a card that’s better suited for your spending habits in the future.

Indigo Platinum Mastercard Compared to Other Cards

Indigo® Platinum Mastercard®

Indigo® Platinum Mastercard®

  • Intro bonus:

    No current offer

  • Annual fee:

    $0 – $99

  • Regular APR:


  • Recommended credit:

    300-670 (Bad to Fair)

  • Learn moreexterna link icon at our partner’s secure site
Citi® Secured Mastercard®

Citi® Secured Mastercard®

  • Intro bonus:

    No current offer

  • Annual fee:


  • Regular APR:

    22.49% (Variable)

  • Recommended credit:

    (No Credit History)

  • Learn moreexterna link icon at our partner’s secure site
Capital One QuicksilverOne Cash Rewards Credit Card

Capital One QuicksilverOne Cash Rewards Credit Card

  • Intro bonus:

    No current offer

  • Annual fee:


  • Regular APR:

    26.99% (Variable)

  • Recommended credit:

    (No Credit History)

  • Learn moreexterna link icon at our partner’s secure site

Bottom Line


As with all of our credit card reviews, our analysis is not influenced by any partnerships or advertising relationships.

If your credit score isn’t great and you want to start building the credit foundation to move in the right direction, the Indigo Platinum Mastercard can help by reporting your usage to the three credit bureaus — if you practice good habits that will reflect positively on your report. But you may also take on a pricey annual fee and risk high utilization due to the card’s low credit limit. Before applying, consider other cards for bad credit and secured credit cards with no annual fee that may better serve your credit-building goals.

Frequently Asked Questions

The Indigo Platinum Mastercard is a decent option for consumers with poor credit who don’t want to put down a security deposit on a secured credit card. Check your prequalification terms, and compare other options for people with fair credit or bad credit before applying.

The credit limit for the Indigo Platinum Mastercard is $300. If you get approved for a version with an annual fee, your annual fee will be deducted from your credit limit.

The Indigo Platinum Mastercard is an unsecured credit card, so you do not have to put down a cash deposit as collateral.

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