Best Credit Cards for Bad Credit | For Consumers With Poor Credit History

In this article, we are going to explore credit cards for bad credit. The goal is to help you find the best credit cards available to consumers with no or poor credit history. We’ve found some fantastic secured credit cards worth considering. We’ll also talk about how you can use unsecured credit cards to build your credit score.

There are plenty of legitimate reasons why people have bad credit. It’s challenging to manage your finances in today’s economic climate. Just paying a bill late will impact your credit score and affect your ability to get access to unsecured credit. If this happens, expect to receive a lower credit limit and pay a higher annual fee.

It can feel like a vicious circle. The problem is, not having a credit limit makes managing your finances even more difficult. People need a credit card to have the flexibility to afford any unbudgeted costs life throws in their path.

If you are looking for credit cards for bad credit or no credit, this article is going to help point you in the right direction. We are going to introduce you to the best credit cards for bad credit. We will also share with you the best way to use credit cards to start to build your credit score, so you have more options in the future.

The Best Credit Cards for Bad Credit

It was not easy to find unsecured credit cards available to people with poor or no credit history. Most unsecured credit cards will expect you to have a positive credit score. If you have no credit history, some cards will give you a very small credit limit, but that might not be the ideal solution for many people.

Instead, we’ve focused on secured credit cards that require a security deposit. This means you control the credit limit. There are some great offers available, plus they also allow you to build your credit.

Our team has researched and analyzed all the credit cards and credit card providers on the market today to find the best credit cards for bad credit. We’ve picked out our two top secured credit cards. Each offers something a little different, and we hope you’ll select the one that fits your needs perfectly.

We’re going to introduce each credit card. We will walk you through the advantages, explain some of the disadvantages, then summarise why this card is worth choosing.

1. Refresh Financial Secured Card

Our top recommendation is the Secured Card from Refresh Financial. Refresh Financial is based in British Columbia and aims to offer all Canadians affordable access to credit. They have helped more than 100,000 Canadians build their credit score so far.

The Refresh Financial Secured Card is a credit card that helps you to build your credit score. One of the most exciting and rare things about the Refresh Financial Secured Card is that it guarantees every application.

There are not many credit cards on the market that offer a guarantee. This makes this card ideal for younger applicants. It is also recommended for those who are new to Canada and haven’t had time to build up a credit history. It is equally a good option for those who have hit on hard times and may now be suffering from a poor credit score. These types of applicants will be limited in their ability to get credit and may not be accepted for traditional credit cards.

Your credit card limit is linked to the size of your security deposit. For example, if your deposit is $5,000, your card limit will also be $5,000. However, you can increase your limit gradually by adding more to your security deposit.

Helping people build a better credit score is the main objective of Refresh Financial. They focus on secured credit cards, loan solutions and education on how to manage and build your credit score. This means when you choose a Refresh Financial product, you’re in good hands.

Refresh Financial also reports your activity to the credit bureaus. This helps to improve your credit score while you are spending.

No credit check is required when you apply for this credit card. As long as you can provide a qualifying security deposit, acceptance is guaranteed.

Purchases made on this credit card have a relatively low-interest rate of 17.99%. However, you will receive an interest-free grace period of 21 days. This means if you pay off the balance of your credit card within this time, you will not pay any interest.

Let’s take a look at some of the pros and cons of the Refresh Financial Secured Card.

Pros

• As this is a guaranteed credit card, there are no credit checks before approval. You will be accepted even if you suffered from bankruptcy or foreclosure in the past.
• The minimum deposit is just $200, with the maximum deposit capped at $10,000. This makes this secured Visa card very accessible to most people.
• The annual fee is only $12.95, with a $3 per month maintenance fee.
• It takes less than 20 minutes to apply for the Secured Card.
• Refresh Financial Secured Card offers a 21-day interest-free grace period on all purchases.
• The additional fees are quite low too. They charge $0.10 if the transaction is declined and $0.50 if you want to pay a bill. This is respectable when compared to other credit cards.
• There is no minimum personal income requirement.
• Refresh Financial offers free online financial management courses.
• Using this credit card helps you to build your credit score.
• Refresh Financial’s Financial Intelligence Training allows you to learn about saving money and being debt-free. You can also learn about credit cards, how to set financial goals and building your wealth.
• Refresh Financial also offers access to your utilization rate. This shows how your spending and repayment behaviour is affecting your credit score.
• There are no Point-of-Sale fees for transactions in Canada. International transaction fees are relatively low at $3.50
• Get access to the Black Tier app for free. This is the ultimate credit-building experience that allows you to view your credit report and run credit simulations.
• If you sign up to Refresh Financial’s Sprint or Jog packs, you can gain access to a credit builder loan.

Cons

• As mentioned, there is an annual fee of $48.95. Some competitor cards don’t ask for an annual fee. However, be mindful that secured Visa or MasterCard providers will make money from you somehow. This is at least transparent. You also can break the fee down into monthly payments to make it more affordable.
• The interest rate of 17.99% is in the con section because credit cards for bad credit naturally have higher interest rates. However, compared to other bad credit secured cards, this interest rate is one of the best.
• There is a $5 fee to use ATMs or cash advances.
• There is a $2 monthly inactivity fee.
• No welcome offer or perks are offered with this card.

Summary

At INCOME.ca, we have a lot of respect for the Refresh Financial Secured Card. We love the fact it’s all-inclusive and available to everybody. We also appreciate that the minimum deposit is lower than any other secured cards on the market.

There is an annual fee, but the other fees are not extortionate. The interest rate is respectable, and if you have any issues, they have fast and efficient customer support.

If your top priority is building your credit score, Refresh Financial is an excellent option. The amount of credit that is available to you is tied to the size of your deposit. This means you cannot borrow any more than this amount. However, you can add more to your deposit and increase your credit at any time.

If you have a low or no credit score and are working to improve your finances and financial future, Refresh Financial could be an excellent option. Visit their website today for more information or to apply for your new credit card.

2. Home Trust Secured Visa

Our next offering is the Home Trust Secured Visa. Home Trust has been operating for more than 40 years and aims to help Canadians achieve their financial goals.

This credit card is a little different than Refresh Financial’s guaranteed credit card option. It isn’t guaranteed, but it is targeted at people with bad or poor credit. There are very few requirements for this credit card, meaning that almost all applications are accepted.

The application starts with a credit check. Once accepted, you can get interest rates lower than 20%. It is a great way to start to build a credit score because Home Trust will report your payments to both Equifax and TransUnion. This will help to build your credit score over time.

Home Trust offers two options for their Secured Visa card:

1. 14.90% interest rate with a $59 annual fee.
2. 19.99% interest rate with a $0 annual fee.

Your credit limit is based on the value of your deposit. You can choose to deposit as little as $500, up to $10,000. Home Trust is one of the few financial institutions that lend to those with poor credit. They aim to help you build or rebuild your credit score and improve your overall finances.

You can use your credit card to shop online, pay bills and set up accounts online. You can also use your card across the world, anywhere that Visa is accepted.

Home Trust Secured Visa is highly regarded within the industry. It has won a number of awards including 2021’s Best Credit Card for Building Credit. It also won the Number 1 Secured Credit Card for 2021.

Below is a list of some of the pros and cons of the Home Trust Secured Visa.

Pros

• The first thing that grabs your attention with the Home Trust Secured Visa is the lack of annual fees. Having no annual fee is a rarity for a secured credit card.
• Acceptance is virtually guaranteed. You simply need to be within the age of majority in your province and not currently experiencing bankruptcy.
• There are no monthly fees associated with this credit card.
• Even if you have previously declared bankruptcy or are in a consumer proposal, you can still be accepted for this credit card.
• You have a 21-day grace period on new purchases before you are charged any interest. This means you have the flexibility to make purchases and not have to pay more than the original cost.
• You will only pay monthly interest if you carry your balance over to the next month.
• This card helps to build up a credit score by sharing the information monthly with Equifax and TransUnion.
• You can use your card in more than 200 countries across the world.
• There is no minimum personal income requirement.
• You can choose your minimum payment amount – either $10 or 3% of your card’s balance.
• If you cancel your credit card, your security deposit will be refunded in full – as long as the balance of your account is clear.
• All purchases are protected for 90 days with Home Trust’s purchase protection.
• Foreign Exchange Fees are lower than many of Home Trust’s competitors at only 2%.

Cons

• The minimum security deposit, or credit limit, is a little higher than the Refresh Financial Secured Card. You are required to pay a deposit of a minimum of $500
• The standard interest rate is a little higher than the Refreshed Financial Secured Card. It is currently set at 19.99%. This is not a terrible interest rate. However, it is worth noting it is higher than other cards available for people with bad credit, including the Refresh Financial option.
• The application process can take as long as 3 weeks.
• There are no perks or rewards associated with this card.

Summary

This card is a good option for most people suffering from bad credit. You don’t have to pay an annual f

This card is a good option for most people suffering from bad credit. You don’t have to pay an annual fee for a start. Additionally, the standard interest rate is in line with the industry average. Acceptance is virtually guaranteed, as long as you pay an appropriate deposit.

Home Trust aims to educate you on debt and improving your finances. They also make monthly reports to the credit bureaus. This helps to improve your credit score in the short and long term.  

A 21-day grace period means you have the option to pay off the balance before you are charged any interest. There is a credit check, it’s not for everyone, but most people will be accepted if their credit history is bad.

For more information, or to complete an application, visit Home Trust’s website today.

3. Capitol One Low Rate Guaranteed Mastercard

Capitol One has offered credit solutions tailored to people’s individual financial situations for more than 20 years. Capitol One offers six different credit cards, but today we are going to look at the Low Rate Guaranteed Mastercard.

As the name suggests, their Low Rate Guaranteed Mastercard is guaranteed. As long as you are at least the age of majority in your province and don’t have an existing account with Capital One, you are guaranteed to be accepted!

This credit card is a great option for those with a bad credit score who need to rebuild their credit without paying high-interest rates. Capital One’s interest rates are set at 14.9% for purchases and balance transfers, lower than many of their competitors. Cash advances have an interest rate of 21.9%.

If your credit score is slightly higher, you may be approved for an unsecured card. Those with a lower credit score will be offered the Low Rate Guaranteed Mastercard. The main difference is that the Guaranteed Mastercard is a secured credit card. This means you will have to provide a deposit, also known as a security fund.

One of the great benefits of this credit card is that you will likely qualify for a credit limit that is larger than your security fund. Once you have submitted an application, Capitol One will inform you how much of a security deposit you need to pay. Security funds range from $75-$300.

Your credit limit will then be set at between $300 and $7,000.

Capitol One aims to help you build your credit score wisely. They report your activity to credit bureaus every month. They also offer educational resources on their website to help improve your finances. You can learn about managing credit, credit scores and understanding credit reports.

This credit card has an annual fee of $79, which is higher than some of Capitol One’s other credit cards. However, this is because, with this card, you are benefiting from significantly lower interest rates.

Capitol One doesn’t offer any perks or frills with this credit card. It is designed to be a vehicle for improving your credit score and this is the main focus of the card. For this reason, this credit card is not recommended for those with a good credit score. However, those with a bad or no credit score may find this an effective way to improve the financial situation.

Let’s take a look at some of the pros and cons of the Capital one Low Rate Guaranteed Mastercard.

Pros

• This credit card is available for those with a bad or no credit rating. Even if you have experienced bankruptcy, you may still be approved.
• Security funds are much lower than many other secured cards, at only $75-$300.
• You can opt to pay your security fund in instalments.
• You will receive Zero Liability Protection, protecting you from unauthorized purchases.
• Capitol One offers Price Protection. This means if an item you purchased goes on sale within 60 days, Capitol One will pay the difference, up to $100.
• You will also receive Purchase Insurance. You will be covered for theft, loss, or damage to items you purchase for 120 days.
• Extended Warranty is offered as standard. This doubles the warranty offered by the manufacturer for up to two years.
• Capitol One offers some great travel benefits. This includes Travel Accident Insurance and Car Rental Collision or Loss Coverage. Travel Assistance is also included. You will also receive up to $100 per day for a maximum of three days if your baggage is delayed.
• There is no minimum annual income requirement.
• There are no foreign transaction fees.
• Capitol One offers security alerts if they notice suspicious activity on your account.
• If your card is lost or stolen, you can get an emergency card replacement and an emergency cash advance.
• The Capitol one mobile app allows you to check your available credit and see payment due dates and minimum payment requirements.

Cons

• As the security deposit is lower, you may be offered a lower credit limit.
• There are no welcome offers or perks available.
• The annual fee of $79 is higher than other credit cards for those with bad credit.

Summary

The Capitol One Low Rate Guaranteed Mastercard is an excellent option for those looking to improve their credit score. Capitol One gives you the opportunity to use credit, regardless of your credit score and credit history. They also make monthly reports to the major credit bureaus in Canada.

One of the great advantages of this card, compared to our previous two offerings, is the ability to have a higher credit limit than your security deposit. This is fantastic for those who are not only looking to improve their credit score but also take advantage of their credit card.

Capitol One’s Mastercard does come with a $79 annual fee, which is higher than many of its competitors. However, if you are happy to pay this amount, you can receive some great benefits, such as low-interest rates and travel perks.

Visit Capitol One’s website today for more information on their Low rate Guaranteed Mastercard.

4. Plastk Secured Credit Card

Plastk offers Canada’s only secured credit card with premium perks and rewards. They aim to help Canadians understand their finances and credit while also providing help strengthening their credit score. The aim is to help you achieve financial freedom.

Credit cards are offered to those with bad or no credit history, or those with a low income. Similar to the other cards we have discussed today, Plastk’s Secured Credit Card requires you to provide a deposit. In most cases, your deposit amount will also be your credit limit. For example, a deposit of $2,000 will result in a $2,000 credit limit. You can provide any deposit amount, between $300-$10,000.

Plastk believes that secured credit cards shouldn’t come without rewards. Plastk offers a point system that is tier-free and easy to understand. For every dollar you spend, you will earn one point. There is no limit on how many points you can earn. Points can be redeemed in several ways:

• Cash-Back: You can use your points to pay your balance. 250 points = $1. You can transfer your points to your credit card through the mobile app.
• Merchandise: Your points can be used for merchandise from well-known brands such as Apple and Sony.
• Flights and Travel: Points can be used for flights anywhere in the world.
• Exclusive Events: You can trade your points for concert or theatre tickets or to be used in a restaurant.
• Gift Cards: Trade your points for gift cards from retailers such as Amazon and Tim Hortons.
• Charitable Donations: You can choose to give your points to charity.

The Plastk Secured Credit Card has an annual fee of $48. The interest rate is set at 17.99% for purchases and 21.99% for cash advances. This is lower than some competitors.

Plastk aims to help you improve your credit score in several ways. They submit your activity to the major credit bureaus every month. They also offer you free access to your credit score with Equifax every month. This allows you to track your credit score monthly.

Applying for this credit card is quick and simple. Most applications are approved within 24 hours. You can apply on Plastk’s website or via the mobile app.

Let’s take a look at some of the pros and cons of the Plastk Secured Credit Card.

Pros

• Receive a sign-up bonus of 0% APR for three months and 5,000 bonus reward points.
• Rewards are available on every purchase you make, with no per purchase, monthly or annual limits.
• Plastk offers a Referral Program to help you earn more points.
• Students receive an additional offer of no annual or monthly fees.
• You will get a 25-day interest-free grace period on all purchases. If you pay the balance of your purchase within this time, you will not be charged interest. You will also receive a 3-day grace period on cash advances.
• All customers receive Zero Fraud Liability, protecting you from fraudulent purchases.
• The $300 security deposit is lower than many of Plastk’s competitors. This means even if you have low initial funds, you can still begin to improve your credit score.
• You can pay your balance instantly with Interac e-Transfers.
• The Plastk mobile app is an excellent tool that allows you to earn points while improving your credit score. You can review your spending habits, check your available credit, track your points, and make payments. The app is available on the Apple Store or through Google Play.
• You can use this credit card worldwide.
• You are likely to be accepted for this credit card even if you have a bad credit score or no credit history. Even those who have experienced bankruptcy are likely to be accepted.
• You can send money to any Canadian credit card, debit card or bank account for a $5 fee.
• To qualify for this card you simply need to meet the age of majority in your province and be a Canadian resident.
• Every time you use your credit card, Plastk will donate $1 to the Calgary Drop-In Centre. This helps to provide health services, employment training, and housing support.

Cons

• There is a $6 per month maintenance fee. When combined with the annual fee, this means you are paying a total of $120 per year.
• If you miss two payments, your interest rate will increase to 29.99%.
• The foreign transaction fee is 3.5%, which is higher than the industry average.
• When you close your account, it can take up to 60 days for your deposit to be refunded.
• Plastk is not available in Quebec.

Summary

Plastk has gone one step further than other credit cards for bad credit. They are the only company in Canada that allows those with bad credit to build their credit rating, while still earning some impressive rewards.

Earning a point for every dollar you spend is a great way of making money on your purchases. Plastk also offers multiple ways for you to spend your rewards. Furthermore, Plastk offers a very generous welcome offer to all customers, as well as additional offers for students.

Plastk’s main focus is still on helping you to improve your credit score and financial future. They offer free access to your credit score every month. They also offer some great features on the mobile app to help you track and improve your credit rating.

However, it is important to note that the fees associated with this credit card are higher than the other options we are looking at today. Monthly fees and annual fees equate to $120, much higher than many of Plastk’s competitors.

It may not be worth discounting Plastk just because of the monthly fees, as they still offer some fantastic benefits.

Visit Plastk’s website today for more information or to apply for your new secured credit card.

5. RBC Visa Classic Low Rate Option

Our final offering is the Classic Low Rate Visa from the Royal Bank of Canada (RBC). This credit card offers low-interest rates to customers who may not have a high credit rating or annual income. Instead of focusing solely on your credit score, RBC looks at a variety of factors when considering your application. This includes your debt to income ratio and any savings you have.

If you do not have a good credit score but still want a more traditional lending option, this credit card is recommended. The RBC Visa Classic Low Rate Option works like a traditional credit card. If your application is accepted, you will be assigned a credit limit. You can then borrow up to this amount. Unlike the other credit cards we have looked at today, RBC does not require a security deposit or down payment.

Your credit limit will be determined based on your credit history and current income. This means if you have a lower credit score, you will likely be offered a lower credit limit. However, credit limits can be changed upon request. Making timely payments and staying within your credit limit can help to improve your credit score. RBC is then more likely to approve an increase in your credit limit.  

The interest rate on this credit card is 12.99% for purchases, balance transfers and cash advances. This is lower than all the other credit cards we have reviewed today. If you are likely to carry your credit card balance over to the next month, this card could be a great option.

RBC offers an interest-free grace period. If you pay your credit card bill before or on your statement due date, you will avoid any interest charges.

The annual fee for this credit card is low- at only $20. There are no monthly fees associated with the card. Although there is no welcome offer available, RBC does offer some reward options, including money off your gas.

To apply for this credit card, you must be a Canadian citizen and at least the age of majority in your province. Completing an application can be done online, over the phone or in an RBC branch. It is quick and simple and can take less than 5 minutes.

Pros

• The annual fee is low at only $20. There is no charge for any additional cards.
• There is no minimum annual income requirement.
• RBC offers Zero Liability Protection, protecting you from fraud on your account.
• Customers also receive Purchase Security and Extended Warranty Insurance.
• Link your credit card to the Petro-Points program to save 3 cents per litre on petrol. You can also earn 20% more points by filling up at Petro-Canada.
• Additional rewards also include a points reward system at Rexall. Get 50 Be Well points for every $1 spent on eligible purchases at Rexall. If you add your credit card to your Door Dash account, you will receive a 3-month free subscription. You will also get unlimited free deliveries on your orders.
• You have the option to add additional services to your account. This includes Balance Protector Insurance and Identity Protection. You can also add RBC Road Assist and Travel Insurance.
• Receive worldwide cash advances of up to $500 daily – as long as you stay within your credit limit.
• As this card is a Visa, it is universally accepted at more than 20 million locations worldwide.
• You can easily manage your account online or via the RBC mobile app. You can easily check your balance, make payments, and send money.
• All customers have access to RBC’s Credit Card Account Updater Service. This automatically updates your preauthorized payments if your card number or expiry date changes. This means you do not need to worry about missed payments.
• RBC makes monthly reports to credit bureaus. This helps to improve your credit score.
• Your credit limit can be changed at a later date, once your credit score has improved.
• RBC’s interest-free grace period is more generous than many of its competitors.

Cons

• If your credit score is rated below ‘Fair’, your application is less likely to be accepted.
• The lower your credit score, the lower your credit limit is likely to be.
• The interest rate was raised from 11.99% to 12.99% in 2019. There is no guarantee that RBC will not raise the interest rate again.
• Be Well points can only be redeemed in $10 increments. 25,000 Be Well points are worth $10. This means you need to spend $500 on eligible purchases at Rexall before qualifying for a reward.

Summary

The RBC Visa Classic Low Rate Option is an excellent option for those looking for a credit card that does not require a security deposit. RBC considers factors other than your credit score. This means you have a higher likelihood of being accepted if you have minimal debt and existing savings.

The interest rate associated with this credit card is also lower than many of RBC’s competitors. With a low annual fee and no monthly fees, this credit card offers some great advantages.

As RBC is one of the biggest banks in Canada, you will also receive some great benefits, such as Zero Liability Protection and Extended Warranty Insurance.

However, RBC does have stricter eligibility requirements. If your credit score is rated below ‘fair’, you may have your application rejected. A declined application can do further damage to your credit score. It is therefore recommended to access your credit score before submitting an application.

If you are still unsure, visit RBC’s website today for more information. Their application process can be as quick as 5 minutes, so you could have your new credit card in no time.

Can I Get a Guaranteed Approval Credit Card?

There is a variety of credit card offers available today in Canada that claim to guarantee approval. Refresh Financial’s Secured Card is one. Naturally, people are skeptical, and one of the questions we get asked regularly is if a credit card is genuinely guaranteed.

The short answer is no. There are some legal limitations put on financial institutions in terms of giving people access to credit. For example, there are age restrictions. So, there are exceptions.

However, in spirit, credit cards can be guaranteed. When card providers guarantee a credit card, the card issuer doesn’t consider your credit score or income level when processing your application. These are key criteria with standard credit applications. Everything from a mortgage to a car loan would need this information.

Types of Credit Cards for Bad Credit

Secure Credit Card

To understand how a secured credit card works, you need to understand the basics of a pre-paid card. When you load the pre-paid card with cash, known as a deposit, you can use the card whenever necessary. For example, many parents like to give their teenagers access to money using pre-paid cards. They can pay for food and travel ( see also Aeroplan and Air Mile credit cards) or have access to money in case of an emergency.

A secured credit card uses the same concept of preloading the card, but this money is used as a security deposit. The card user can pay for products and services using the card as a traditional credit card. They will have a grace period where no interest is charged. Should they not make your payment on time, the security deposit can be used.

A secured credit card can act as a credit builder. It will connect to the most important credit bureaus in Canada and positively impact your credit score if you make payments on time. However, it’s important to remember, should you fail to make a payment, the secured card provider will use the security deposit paid on the card.

Unsecured Credit Card

An unsecured credit card works very much like a traditional credit card. No security deposit is required. However, should you suffer from no or poor credit, access to this type of card will be limited. Some providers offer a minimum amount of credit for you to use to demonstrate your ability to pay back promptly. This, in turn, will help build your credit score and get you access to more credit. However, they usually come with a credit check. Although they might accept people with less than perfect credit, they tend not to be as welcoming to people with poor credit as secured cards.

How to Rebuild Your Credit Score

Unfortunately, there are no shortcuts or easy, quick fixes when it comes to repairing your credit score.

Having a negative score can impact you financially for years. It’s a vicious circle. Typically without good credit, you are unable to get any credit at all. Then, you are not able to pay back your debt on time to be able to build a credit score. However, there are ways that you can start to rebuild the trust of lenders – read our ‘How Long Does it Take to Rebuild Credit? post.

Let’s go through some of the simple things you can do to start to rebuild your credit score.

Open a New Checking and Savings Account

Simply opening a checking and savings account will help you start to manage your finances more effectively. Equally, these types of accounts have little to no fees. If you pick the right savings account, you can even start to earn money on the cash you are able to put away each month as savings.

The best habit you can have is saving money each month. Even if it’s only a few dollars to start with, the habit of saving money is contagious. With the right savings account, you’ll be able to see your pot start to grow.

Pay Your Bills on Time

Most people know that having debt is common. The financial industry wants you to have debt; they make money by you borrowing money. The key to building credit is paying your bills on time. It’s that simple. You get rewarded for paying bills on time, and you lose points if you are late.

Every person has a credit score. You could have good or bad credit. You can he even have no credit, but you do have a score. That score determines the type of finance and interest rates you are offered on financial products, from a mortgage to a contracted mobile phone.

There are credit bureaus that track each individual’s credit score. It matters less how much money is to be paid back, just that you pay it back on time, every time.

Apply for New Credit Cards

The best way to go about building your credit score is to start with a secured credit card. This allows you to start demonstrating your new good habits when it comes to paying bills in a timely manner. Even with a secured credit card, they will inform the credit bureaus that you are paying your balance off in time.

Once you have been able to demonstrate your ability to pay your bills, try to apply for an unsecured credit card. Pick one that is targeted towards people with less than perfect credit history. Obviously, you’re going to pay a higher interest rate because you are a higher risk to the credit card issuer.

When you first get the unsecured credit card, you can expect to have very limited withdrawal limits. However, as you start to use the card to make regular payments, as your credit score increases, so does your credit limit.

The goal is to use both cards simultaneously and pay them back ideally within the 21 day grace period you get before interest is applied. Now you have demonstrated your ability to pay back multiple lines of credit at the same time and on time. This is one of the best ways to start to rebuild your credit in Canada.

The Bottom Line

Life is not easy, especially financially. People need some financial flexibility. Having access to a credit card definitely helps. Unfortunately, not everyone has good credit. A standard credit card provider will run a credit check and will have criteria in place that only accepts applicants with the best credit scores.

But an unsecured credit card is not your only option. A secured credit card issuer cares less about your credit score. We feel the top two credit cards for people with bad credit are the two we’ve talked about in this article.

The Refresh Financial Secured Card is our top pick. But, if you’re looking for a credit card that doesn’t have annual fees, then you’ll want to look at the Home Trust Secured Visa. Both will give you access to credit while giving you the ability to start to build your credit score. Over a period of time, you will have more credit options available to you.