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Credit cards for consumers with fair or average credit
With a fair credit score, you might have trouble qualifying for top-rated rewards credit cards and the most competitive interest rates. The good news is that many credit card issuers offer cards specifically designed for people who don’t have outstanding credit scores.
Used correctly, a credit card for fair credit could help you build up your score and improve your chances at getting better cards, lower interest rates and more. A better credit score could even make it easier to qualify for car loans, mortgages and other types of credit.
Compare our top cards for fair/average credit
What does it mean to have fair or average credit?
When you have a fair credit score, it means that your credit is one level below good but one level above bad or very poor. Credit score typically refers 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 considered fair.
FICO score ranges
|300-579 Very Poor
|740-799 Very Good
How your credit score is calculated
The three major credit bureaus — Experian, Equifax, and TransUnion — assign credit scores based on a combination of factors. Each one counts for a specific percentage of your credit score.
Your payment history
35 percent of your credit score
This record indicates how often you make your payments on time vs. how often you may have missed or skipped payments. In the eyes of credit card issuers and other lenders, paying on time helps establish you as a reliable person to do business with.
How much of your available credit you’re using
30 percent of your credit score
The term credit utilization ratio sounds complicated, but it’s simply a percentage that measures how much credit you’re currently using in relation to how much credit you have available to you. As a general rule, experts recommend using no more than 30 percent of your available credit.
Length of credit history
15 percent of your credit score
If you just opened your first credit card a month ago, your credit score won’t be as strong as someone who’s had a credit card for several years and has built up a solid history of paying their bills on time.
10 percent of your credit score
Applications for new lines of credit account for a small part of your credit scores. Just remember that any application involving a hard credit check can put a small, temporary dent in your credit score. Applying for multiple cards in a short period of time might even give potential lenders the impression that you’re trying to borrow more than you can afford to repay.
The types of credit you have
10 percent of your credit score
Part of your credit score is determined by your credit mix, which can include credit cards, car loans, student loans and mortgages. Credit mix counts for just 10 percent, so you’ll want to avoid aggressively opening new lines of credit just to expand it.
Five ways you can try to improve your credit score
If your credit is just fair, your goal should be to improve your overall credit standing. Here are some good credit habits to keep in mind as you work toward raising your credit score.
- Pay your bills in full and on time. Any missed or late payments will hurt your score. If you do have unpaid balances from time to time, keep them as low as possible.
- Try to keep your credit utilization under 30 percent. In other words, don’t use more than 30 percent of the total credit available to you.
- Look for pre-qualified offers on credit cards, loans and other types of credit. A pre-qualification check won’t affect your credit score the same way a hard inquirywill.
- Check your credit report and be prepared to correct errors. Incorrect information on your credit report — even something as simple as a misspelling of your name — could be keeping your credit score lower than it should be. Check your report and find out how to dispute errors.
- Be careful about canceling older credit accounts. A credit card that you’ve had for a long time adds to your length of credit history. Even if you don’t regularly use the old card anymore, keeping your account open and occasionally active could benefit your score. Consider setting up autopay for a small recurring charge — like a streaming service — on your old card so you won’t worry about cluttering up your wallet.
Don’t expect your credit score to go from fair to good overnight. In fact, it could take months to see it improve significantly. Think of it as a long-term project that will pay off in the long run.
Why a higher credit score matters
The reason why pursuing good credit is a worthy goal is that the people with good credit tend to get more opportunities and better offers.
Having a higher credit score typically makes you a more attractive candidate for a credit card, car loan, mortgage or other type of credit account. If your credit is just average or fair, you’ll likely pay higher interest rates even if you’re approved.
For example, if you have a fair credit score of 660 and you apply for a credit card with a variable APR range of 15% – 24%, 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 pay only 18% APR.
Better credit can save you money. 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.
Four things to consider before you apply
Here are some tips to keep in mind as you shop around for a credit card.
- Know your credit score. It’s important to have a general idea of which cards you might qualify for. Some cards might require a good credit score or even higher, so applying for a card out of your credit range could turn out to be unsuccessful.
- See if the card has a recommended credit score. The card issuer might specify a credit range that’s most likely to be approved. Look for the recommendation in the card’s marketing details.
- Look for lower APR. Annual Percentage Rate (APR) represents the total cost, including interest, charged by credit card issuers and other lenders. If you typically carry a balance on your credit card, APR will come into play. The lower the APR, the less you might have to pay for an unpaid balance.
- Get a sense of the fees. With every card you’re interested in, check the annual fee, late fee, penalty APR and other charges. A card that’s less expensive to own could provide more value.
Frequently asked questions about fair credit and credit scores
Is it easy to get approved for a card with fair credit?
Your credit score gives lenders a general idea of how likely you are to pay what you owe. Although it’s easier with a higher credit score, consumers who have fair credit can and do receive approval for credit cards.
What kind of card can you get with fair credit?
While many credit cards for fair credit fall into the no-frills category, some offer features such as cash back rewards and other benefits. On the other hand, you’ll probably have trouble qualifying for a zero-interest intro offer on a balance transfer credit card with a credit score below 670.
What is the minimum credit score for a credit card?
The lowest possible credit score is 300, which few people actually have. It’s possible to qualify for a card with a credit score in the 300s, even if you have no credit history. People with fair credit can generally expect a minimum required credit score of 580, about 120 points below the national average.
What’s the difference between a credit score and a credit report?
A credit score can be compared to a snapshot that captures the overall state of your credit at a given point in time. A credit report provides a more comprehensive look at your overall credit history from the beginning to the present.
How long does it take to receive a new credit card?
In general, getting a card could take anywhere from several days to a few weeks. The time it takes to check your credit, process the application and send the card through the mail all have an effect on the process. A lot depends on the issuer, even though some offer quick access by sharing your card number and account number with you before the physical card arrives.
How much do late payments hurt your credit score?
Late payments don’t deduct a set number of points from your credit score, but your payment history is the most important score factor at 35 percent. How late payments affect your score varies based on factors including how recent and long overdue your late payment was, which scoring model the lender uses and the number of late payments on your report.
Luckily, a lender can’t report a late payment to the credit bureaus until it’s a full 30 days past due.. Just don’t forget that you could face direct consequences from your lender, like late fees and a penalty APR.
How we evaluate credit cards for fair credit
As someone with fair credit, you should focus on maximum value and potential to build your credit score. While Bankrate uses a 5-star scoring system to rate a card’s overall quality, cards in the fair credit category receive particular attention in the areas of:
An affordable APR could save you money if you ever have to carry an unpaid balance from one month to another.
Continuing the focus on affordability, our top-rated cards for fair credit often charge no annual fee or have an annual fee in the $29-$99 range.
Our top recommendations include cards that increase your credit line if you make the required number of on-time payments.
Many of the cards on our list offer pre-qualification, which means you can get an idea of how likely you are to get approval without a hard credit inquiry that takes a small bite out of your credit score.
More information on credit cards and credit scores
If you’re looking for options with fair credit or ways to build your credit score, check out some Bankrate resources:
Senior Editor Barry Bridges has been writing about credit cards, loans, mortgages and other personal finance products for Bankrate since 2018. His work has also appeared on websites including Nasdaq.com, Zillow.com and The Simple Dollar. He was previously an award-winning newspaper journalist in his native North Carolina. Send your questions about credit cards (and fantasy baseball) to firstname.lastname@example.org.
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