Editorial disclosure: All reviews are prepared by Bankrate.com staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including card rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the bank’s website for the most current information.
Author: Robin Saks Frankel, @robinsaks | Last Updated: September 7, 2018
In this article:
- Reviews of our top picks
- What is considered “average” credit?
- The difference between good credit and fair credit
- Things to consider before you apply
- How to improve your credit score
- Recap: Key features of our favorite cards
How we chose our favorite fair credit cards
Having a fair or average credit score doesn’t mean that you have to settle for an average credit card. Bankrate’s credit card experts have reviewed over 150 credit cards for fair credit to find the cards that offer the most. Using our proprietary measuring system each card is measured against its peers and given a Bankrate score out of 100.
Our credit card connoisseurs include a whole host of factors into their analysis including things like APR rates, the opportunity to build credit, balance transfers, introductory bonuses, annual fees, rewards value and how easy rewards are to redeem, travel perks, and any extras and discounts. For those with fair credit, we figured you would want a card that offers the most bang for your buck whilst maybe working to push up your credit score. With this in mind we focused most heavily on these factors:
- Introductory APR – APR stands for annual percentage rate and refers to the interest rate you incur on your outstanding balance. Standard APR can range from below 10% to over 20%. Some credit cards offer introductory APRs, like on balance transfers and purchases, which can save you a ton on charges. We pay attention to the fine print to help find the best deal and hopefully save you some money.
- Annual fee – A lot of cards charge an annual fee and sometimes this fee can take away from the value of the perks and rewards offered by the card. We review the annual fee cost against the value offered by the card. We also spell out how much you would need to spend on your card each year to make up the annual fee to help you identify which card would suit your lifestyle.
- Sign-up bonuses – Added extras offered for signing up can make a card more valuable. Things like waiving the annual fee in the first year and low balance transfer fees can take a credit card from good to great.
- Rewards – Having a fair credit score doesn’t mean that you need to accept subpar rewards. We study each cards rewards structure — which can be measured in miles, points, and cash back — and identify which card can get you the most back on your spending.
Editor’s take on our favorite credit cards for fair credit
Capital One Platinum Card
If your goal is to own an unsecured card, but your credit isn’t up to snuff, this card may fit the bill. As long as you pay your bill in full every month and can avoid the stiff APR fees, this card can help you boost your overall credit standing.
- If you make five on-time payments in a row, Capital One may grant you access to a higher credit limit, which can help improve your score.
- The card comes with Mastercard platinum benefits which include travel and auto protection.
- If you make a late payment, it won’t affect your APR.
Discover it® Cash Back
This is one of Bankrate’s top-rated cash back cards for good reason. This little no-fee cash-back wonder not only lets you earn rewards by enrolling every quarter to earn 5 percent cash back on up to $1,500 in purchases made in various categories throughout the year, it will automatically match the cash back you’ve earned at the end of the first year. All other spending earns 1 percent cash back, also matched at the end of the first year.
- This card comes with an introductory 14-month 0 percent offer on purchases and balance transfers. After that, it’s a variable 13.74% to 24.74%.
- Your first late payment fee is waived, after that, it’s $37.
- There are no foreign transaction fees with this card.
Capital One QuicksilverOne Cash Rewards Credit Card
Anyone with just so-so credit longing for a rewards card will likely approve of what the Capital One QuicksilverOne Cash Rewards Credit Card is offering. With an unlimited 1.5 percent cash back rewards structure, this is one of the only cards available to those with fair credit to offer meaningful rewards. Keep in mind that there’s a $39 annual fee with this card so you would have to spend over $7,800 a year to make this card’s earnings greater than that of a no-fee card with 1 percent rewards.
- You can get access to a higher credit limit after making five consecutive on-time payments.
- There are no rotating categories to sign up for or keep track of, earning rewards is automatic.
- Your cash-back earnings can be redeemed at any time and in any amount.
What is considered “average” credit?
When your credit score is considered fair, it means that’s it’s neither great nor terrible. When a reference is made to your credit score, it’s typically referring to your FICO score, a three-digit number that ranges from 300 to 850 using a scoring model developed by the Fair Isaac Corporation. If your score is between 580 and 669, you land in the range labeled fair.
The three major credit bureaus—Experian, Equifax and TransUnion assign everyone a credit score based on a combination of factors that make up your financial history. These factors include:
- Your payment history. This will show if you make your payments on time or often you may have missed or skipped payments.
- How much of your available credit limit you’re using. This is called your debt-to-available-credit ratio and generally, it’s better for your score if you’re using no more than 30% of the maximum amount you have the ability to charge on your cards.
- Length of credit history. If you just opened your first credit card a month ago, your credit score won’t be as strong as someone who opened their account ten years and has built up a solid history of paying their bills on time.
- Credit inquiries. Every time you open a new line of credit—whether it’s with a credit card or another type of loan like a mortgage or car lease, your score gets dinged. Opening up too many cards in a short period of time can be a red flag to lenders that you might be borrowing more than you can afford.
- The types of credit you have. Loans come in two flavors: revolving—like with a credit card where you can carry a balance of different sizes from month to month, and installment—like with a car payment which is typically a fixed amount every month.
The difference between good credit and fair credit
The reason for pursuing good credit is a worthy goal is that the most favorable lending terms are given to those with the best credit. This means that if your credit is just fair, you’ll likely pay higher interest rates on your credit card, mortgage, car loans and any other type of loan that carries finance charges.
For example, if you have a fair credit score of 660 and you apply for a credit card with a variable annual percentage range of 15 percent to 24 percent, you may be approved for the card at an interest rate of 22 percent. But someone with a good credit score of 700 may get approved for that same card but only pay 18 percent APR. Better credit can save you money.
For example, if you owe $10,000 on a credit card with an interest rate of 22 percent, and you don’t touch that debt for a year, you’ll accrue $2,200 in interest. But, someone who owes that same amount but only has an APR of 18 percent will owe $1,800—a $400 difference.
When it comes to longer-term loans, like that on a mortgage, getting a better interest rate can save you thousands of dollars over the life of your loan.
Things to consider before you apply
You can still qualify for a good credit card even if you have fair credit. Use the card as a means to improve your credit standing and eventually qualify for better interest rates by paying your bills in full, on time and not using too much of your available credit. Here are some tips to keep in mind as you choose which card to apply for:
- Know where you stand. Check your credit score before applying to see where you stand. Using a site like myBankrate.com will let you check your score for free. It’s important to know what you can qualify for so you don’t get rejected by applying for something that requires better credit than you have. Every time you apply for a new line of credit, it can cause your score to dip so you don’t want to get turned down for a card and have it negatively affect your score.
- Review your spending patterns. You may think that getting a credit card that offers rewards is a smart move. But, if you typically carry a balance and that card comes with a steep APR, you may be better off with a card without rewards that has lower finance charges. The value of any rewards earned on a credit card will almost always be outweighed by the cost of double-digit interest fees on a balance.
- Stay under 30 percent of your total available credit. If you’re aiming to improve your overall score—and you should be, you should always aim to stay at 30 percent or less of your total available credit on the card. For example, if you have a $10,000 credit limit, it’s best to keep your monthly balance at or below $3,000.
- Consider a secured card. If you don’t qualify for the card you want, or you’re at the low end of what’s considered fair credit, you may want to try a secured card. Although they require a security deposit equal to the credit limit you’re seeking, if you choose one that reports to all three credit bureaus it can be a great way to improve your score over time and help keep your spending in check as the limits on secured cards are typically lower than unsecured. If possible, choose a secured card that lets you “graduate” to an unsecured card after demonstrating good financial behavior.
How to improve your credit score
If your credit is just fair, your goal should be to improve your overall credit standing. Here are some do’s and don’ts to keep in mind as you work towards your goals.
- Pay your bills in full and on time. Any missed or late payments will hurt your score.
- Choose a card that aligns with your spending patterns.
- Keep your balances low and aim to stay under that 30 percent mark.
- Check your credit report thoroughly and often to make sure there aren’t any errors that could be affecting your score.
- Rack up a lot of new charges just because you have a new line of credit.
- Apply for too many new cards or ones that require better credit than you have as this can also lower your score.
- Close a credit card you’ve held for a long time as this can negatively affect your score. If there’s an annual fee that you don’t want to pay any more, ask the issuer if you can product change to another card without a fee.
Recap: Our best credit cards for people with fair credit
|Card Name||Bankrate Score||Annual Fee||Key Feature|
|Capital One Platinum Card||78/100||$0||No foreign transaction fees|
|Discover it® Cash Back||93/100||$0||Rotating bonus cash-back categories|
|Capital One QuicksilverOne Cash Rewards Credit Card||81/100||$39||1.5% cash back on every purchase|
* See the online application for details about terms and conditions for these offers. Every reasonable effort has been made to maintain accurate information. However all credit card information is presented without warranty. After you click on the offer you desire you will be directed to the credit card issuer's web site where you can review the terms and conditions for your selected offer.