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Navigating through credit card offers without a credit score can be a daunting task. Often, the offers that appeal to us the most are ones that are reserved for people with average or excellent credit scores. According to the Consumer Financial Protection Bureau, 45 million consumers in the United States do not have a credit score. In order to help this population, we looked through many different credit card offers to find the cream of the crop, and then narrowed those down to the cards that can be obtained with no or limited credit history.
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Best Credit Cards For No Credit
After reviewing hundreds of credit cards, we selected the following cards as our picks for the best credit cards for individuals without credit history. Our choice is based on a combination of quantitative factors, such as net rewards rate and value of bonuses, as well as qualitative considerations like whether or not cards report your credit score to the credit bureaus.
Discover it® Student Cash Back: Best Option For Students With No Credit History
The Discover it® Student Cash Back is one easy-to-get option when you have a thin credit profile -- without sacrificing reward value. The card provides users with 5% cash back in categories that change each quarter like gas, restaurants, wholesale clubs and more, up to the quarterly maximum of $1,500 when you activate. For 2019, the categories include grocery stores (January-March), gas stations, Uber & Lyft (April-June), restaurants (July-September), Amazon.com (October-December).
What makes this card particularly great for students is the statement credit for good grades. Those who sign up for the Discover it® Student Cash Back will get a $20 statement credit each school year their GPA is 3.0 or higher for up to the next 5 years. No other credit card we came across offers any rewards for performing well in school.
Why It’s Useful If You Have No Credit: Once you graduate school and you manage to build up a credit history, you can upgrade this card to the non-student version. That card is one of the best reward credit cards, and comes with a very similar reward structure. Furthermore, since both the student and non-student Discover it® cards have no annual fee, there's no harm to keeping them around forever, even if you don't use them. That will help build up what's known as the average age of your credit, further increasing your FICO score.
What to be careful of: There are two important considerations to make before committing to the Discover it® Student Cash Back. First, just like the Chase Freedom®, if you are not paying attention to the categories where you can earn 5% cash back, you'll use the card in a suboptimal manner, and get just a 1% return on your purchases. The card requires you to be on top of the quarterly rotating categories to make the most out of it. Secondly, the Discover network is not accepted nearly as much as Visa or Mastercard -- this is especially true abroad. If you like to travel overseas, or need something for your semester abroad, keep in mind that you may run into difficulties when attempting to charge something to this card.
- Good Grades Rewards: $20 statement credit each school year your GPA is 3.0 or higher for up to the next 5 years
- $0 annual fee
Discover it® Secured: Easiest Credit Card To Get
The Discover it® Secured is one of our favorite secured credit cards thanks to not having any annual fee and a rewards rate akin to offers typically only available to those with average credit or better. The card provides 2% cash back at restaurants or gas stations on up to $1,000 in combined purchases each quarter; all other spending gets you an unlimited 1% cash back. Additionally, Discover will also double all the cash back you’ve earned at the end of the first year for new cardmembers.
Why It’s Useful If You Have No Credit: Outside of being one of the easiest cards to get, all Discover credit cards come with free FICO® monitoring benefits. Through the account website, you will be able to see your credit score increase as you pay your bills, and your age of credit increases. Once your credit score is high enough, you will be able to apply for a better credit card, and increase the rewards you earn.
What to be careful of: The one area where the Discover it® Secured is not great is interest: the card comes with a high interest rate -- 25.24% Variable. That is nearly 8 percentage points higher than the average credit card interest rate. If you cannot pay off a balance month-to-month, we don’t recommend getting this card. The interest charges will overshadow any value you might experience from the rewards.
- 2% cash back at restaurants or gas stations on up to $1,000 in combined purchases each quarter; 1% cash back on every other purchase
- Reports to all 3 major credit bureaus
- For new cardmembers, Discover doubles the cash back you've earned at the end of the first cardmember year
Aeromexico Visa Secured Credit Card: Easiest To Get Airline Credit Card
If you love to travel and want to get ahead of the miles game, the Aeromexico Visa Secured Credit Card lets you do that with no credit history. This is one of the few secured airline mile credit cards, and the benefits are reminiscent of the top performers. Outside of earning double miles on things like gas and groceries, cardholders receive will receive one $99 companion certificate upon making their first purchase, and one upon card renewal. The certificate allows you to buy a ticket with Aeromexico and get the second one for $99 plus taxes and fees. Depending on how you book your itinerary, this benefit can be potentially worth hundreds of dollars.
Why It’s Useful If You Have No Credit: The Aeromexico Secured credit card has a clear upgrade path. As your credit score improves, you will be able to upgrade your account to the Aeromexico Visa card, and eventually the Aeromexico Visa Signature. These come with better and better perks, and benefits.
What to be careful of: Before applying for this card, take a moment to examine Aeromexico destinations. The miles you earn will be mostly useful towards on flights with the affiliated airline. Since Aeromexico is a member of the SkyTeam alliance, you can also book award travel on some of its partner airlines, however, award availability on these will vary.
- Double Miles on Gas & Groceries
- 5,000 First Use Bonus Miles plus Complimentary Companion Certificate; you also receive another $99 companion certificate with renewal
- $0 Introductory Annual Fee for the first year, and $25 thereafter
SDFCU Savings Secured Visa Platinum Card: Easiest Credit Card To Get For International Travel
If you frequently travel abroad and would like a credit card to handle some of your expenses when there, the Savings Secured Visa Platinum Card will be the best choice, if you have zero credit. The card comes with a number of features that make it well suited for overseas use. First, it has no foreign transaction fees. Most credit cards will charge 3% FX fees for every swipe of the card that goes through a foreign bank. If you frequently use your credit card on your travels, this can produce significant savings over time. The other good feature that comes with the Savings Secured Visa Platinum Card is its Chip & Pin EMV technology. Most cards in the U.S. are issued with the Chip & Signature variant, which will not work in certain countries. With Chip & Pin enabled, you can sue the Savings Secured Visa Platinum Card pretty much anywhere in the world.
Why It’s Useful If You Have No Credit: The Savings Secured Visa Platinum Card is one of the few secured credit cards to come with a reward program -- something that is not common for people with no credit scores. The card reports your credit activity to all three credit bureaus that will, over time, help establish your credit score.
What to be careful of: The SDFCU Secured credit card cannot be upgraded to a non-secured credit card. That means you cannot get your security deposit fully refunded, unless you close down the account completely. If you choose to shut down your account in order to get your deposit back, your credit score will also take a hit. The other consideration to keep in mind is that you need to be a member of the SDFCU in order to apply for the card. Employees of the Department of State can get this for free. You can also qualify by getting a lifetime membership to the American Consumer Council -- the cost of this is just a one time fee of $15.
- Chip & Pin EMV Technology
- Low 7.24% APR
- No foreign transaction fees
How To Get A Credit Card With No Credit History
If you have very limited credit history, there are a few steps you can take to help you open up a credit card account.
Apply for a secured credit card. The easiest credit cards to get with no credit history are secured ones. These credit cards require you to submit a security deposit that will act as your line of credit. If you fail to pay back your debt, the security deposit becomes forfeit. Before applying for a secured credit card, make sure the issuer reports your activity to any one of the three major credit bureaus. The whole point of secured cards is to use them to build or re-build your credit history. If the issuer doesn't report your timely payments, you will not move from square one. So if you put in a security deposit of $300, you can only charge up to $300 on the card, and won't have any more room until you pay that balance down.
If possible, become an authorized user on someone else’s account. If your spouse of family member has an account they would be willing to put you on, you will immediately be generated a FICO score, opening up your available options. However, like with secured cards, not all issuers will report authorized users to the credit bureaus. Ask the banker before applying, before committing to this as a solution.
Apply in branch. By speaking with a bank representative you increase your chances of getting approved for a credit card. A banker can work with you to double check for factors that can make you eligible for a card account. They can also help you call a reconsideration line if your application is initially declined.
Be willing to establish a banking relationship with the issuer. If possible, opening a checking or savings account with the issuer can also aid in obtaining a credit card from them. Because they want to retain you as a customer, a bank may be willing to relax the minimum requirements for their new credit card applicants. With some banks, such as Bank of America, having a checking account can also result in obtaining bonus spending rewards. Just watch out for the checking account fees.
Have proof of income. Being able to show a credit card issuer a proof of steady income can impact your application approval odds. One of the major factors a bank looks at when deciding whether or not to issue a new credit account is the individual’s ability to repay the debt. Federal law mandates that the issuer be certain the account holder will be able to pay back at least the minimum amount due on the line of credit they issue.
Consider signing up for a store credit card. If all else fails, one option left to those with no credit history is to sign up for a card with a big retail store, such as Macy's or Target. Generally speaking, store credit cards are much easier to get than cards issued by banks. We caution everyone to read through the terms of such cards carefully. While they are easy to get, they are also notorious for having high APR and fees. If this will be your first credit card, you should ideally look for one with no annual fee. Even if it doesn't have a great reward program, you can use it to establish your credit history. Make all your payments on time, and keep credit utilization low. Within a year, you should be able to qualify for a better bank card.