Navigating the world of credit can be challenging, particularly if you have a poor credit history. However, this does not mean that you cannot get a credit card. There are credit cards designed specifically for people with bad credit, and some of them even offer relatively high credit limits. In this article, we will explore some of these options. However, always remember to use credit responsibly to avoid falling into debt and further damaging your credit.
1. Capital One Platinum Secured Credit Card
Capital One Platinum Secured Credit Card is one of the more flexible options for people with bad credit. While it’s a secured card – meaning it requires an upfront deposit as collateral – it does offer the potential for a higher credit limit compared to many other secured cards.
You could get a credit limit of $200 with a deposit of $49, $99, or $200, depending on your creditworthiness. With responsible card use, you could potentially get access to a higher credit line with no additional deposit in as little as six months. This card also has no annual fee.
2. Discover it® Secured Credit Card
The Discover it® Secured Credit Card allows for a credit limit up to the amount of your security deposit, with a minimum deposit of $200. This card also features a cash-back reward program, with 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter, and an unlimited 1% cash back on all other purchases.
One unique aspect of this card is the potential to transition to an unsecured card. After eight months, Discover starts monthly reviews of your account to see if you’re eligible to get your security deposit back, which would make your card unsecured.
3. OpenSky® Secured Visa® Credit Card
With the OpenSky® Secured Visa® Credit Card, your credit limit is equal to your security deposit, up to $3,000. This card doesn’t require a credit check when you apply, making it an accessible option if you have very poor credit or no credit at all.
Considerations for High-Limit Credit Cards
While a high-limit credit card can seem appealing, it’s essential to remember that any balance you carry on your card will need to be paid back, and high balances can lead to high interest charges if not paid in full each month. High balances can also negatively impact your credit utilization ratio, which can further harm your credit score.
Also, many credit cards for people with bad credit require security deposits. While these deposits are typically refundable if you close your account or upgrade to an unsecured card, they can be a substantial upfront expense.
Responsible Credit Card Use
The primary goal of getting a credit card when you have bad credit should be to improve your credit score. This can be achieved by using your card responsibly. This means making all of your payments on time, keeping your balance low, and not applying for too many new credit accounts at once.
In conclusion, while there are credit cards available for those with bad credit offering relatively high limits, it’s crucial to handle these cards responsibly. Using a credit card wisely can help you build your credit over time, potentially making you eligible for cards with better terms and benefits in the future.