If you have bad credit or a limited credit history, a new credit card offers one of the easiest ways to build a steady credit history and improve your score. Unfortunately, pursuing this option isn’t always as easy as it sounds.
First, getting approved for a credit card can be difficult if your credit is poor. Worse, every credit card application you complete leaves a “hard inquiry” on your credit report — and those repeated inquiries can cause your credit score to drop even further.
If you want a new credit card but don’t want to further harm your credit score while you search, the best thing you can do is get pre-qualified for a card. When you take the steps to pre-qualify, you’ll get a good idea of whether or not you might get approved, and with a lesser “soft inquiry” on your credit report.
While getting pre-qualified doesn’t guarantee you’ll be approved, it can give you a good idea of your chances. Fortunately, all of the top card issuers have web pages set up to help people pre-qualify for their top offers. Click through to any of these pages to see if you pre-qualify for any of their cards:
- American Express: Enter your name, address, and the last four digits of your Social Security number to get preapproved for the top offers from American Express.
- Bank of America: Submit your full name, address, date of birth, and the last four digits of your Social Security number.
- Capital One: Submit your full name, address, date of birth, and the last four digits of your Social Security number.
- Chase: Enter your full name, your address, and the last four digits of your Social Security number to get pre-approved for a card with Chase.
- Citi: Enter your name, your address, the last four digits of your Social Security number, and your preferred card type.
- Discover: Enter your name, the last four digits of your Social Security number, and your preferred card type.
- US Bank: Enter your name, address, the last four digits of your Social Security number, and your preferred card type.
Check Your Personal Loan Rates
Answer a few questions to see which personal loans you pre-qualify for. The process is quick and easy, and it will not impact your credit score.
Credit Cards for People with Bad Credit
Most of the card issuers above offer at least one card for people with less-than-perfect credit. By seeing if you pre-qualify, you can get a good idea of what kind of card you should apply for based on your credit history.
Still, there are a ton of different credit cards geared specifically at people with bad credit as well. If your score is considerably lower than average and you’re not having any luck getting pre-qualified with one of the links above, you can also scour our guide on the Best Credit Cards for Bad Credit. While some cards for people with bad credit come with fees and higher interest rates, they can help you improve your credit regardless, provided you use them responsibly.
Five Ways to Boost Your Credit Score Fast
Whether your credit is fair or poor, moving the needle upward should be at the top of your agenda. If you can’t qualify for a credit card or are scared to try because your score is so low, use these four strategies to boost your credit score fast:
Try a secured credit card instead.
While unsecured credit cards extend an actual line of credit, secured credit cards require a cash deposit you can borrow against. Because you must put down a cash deposit that is normally equal to your credit limit, secured cards are fairly easy to qualify for — the bank has little to lose if you default, since they’ll just keep your deposit.
Since secured credit cards report your credit activity to the three major credit reporting agencies – Experian, TransUnion, and Equifax – using a secured credit card responsibly can help you improve your credit score month by month, and most issuers will eventually let you “graduate” to a regular card.
- Related: Best Secured Credit Cards
Check your credit report for errors.
If you haven’t checked your credit report recently, you’ll want to do that right away. An error on your credit report can wreak havoc on your score without you even knowing. Fortunately, you can get a free copy of your actual credit report from all three credit reporting agencies for free once per year from AnnualCreditReport.com.
- Related: How to Dispute Credit Report Errors
Clear up any debts in collections or default.
Once you’ve scoured your credit report for details, you should make cleaning up any problems a priority. If you have debts in collections or default, you should focus on repaying those debts right away. In the meantime, make sure to keep all of your bills current as well.
- Related: How to Handle Debt in Collections
Pay all of your bills on time.
Most lenders rely on the FICO credit scoring method, in which your payment history makes up 35% of your score. If you want to make a big impact on your credit score, one of the best things to do is to pay all of your bills on time, every time. Never pay late, and you’ll never ding your score for late payments or pay late fees.
Pay down balances.
While paying your bills religiously is the best way to improve your credit score over the course of months or years, the second biggest factor influencing your credit score is the amount of debt you carry relative to your credit limit. If you have a maxed-out credit card (or any line of credit where you’re using more than 20% to 30% of the available credit), paying down that balance will improve your credit score almost instantaneously.
It’s a common catch-22: Having bad credit can make it difficult to qualify for a credit card that might help you improve your credit score over time. If you have a poor credit history but want to apply for a credit card, the best thing you can do is try to pre-qualify for a card to protect your credit report from hard inquiries.
Using the links above, you can get a general idea of where you stand. If your credit score is too low, on the other hand, you should should focus on improving your score with whatever means necessary. As with anything else worth doing, building credit takes time.