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Editorial Disclosure:Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
Snapshot: The Capital One VentureOne Rewards credit card is a good fit for the occasional traveler who wants to earn travel rewards on everyday purchases without paying hefty annual fees.
Like what you see? Learn how to apply for a Capital One VentureOne Rewards Card
travel rewards cards. Your travel miles never expire as long as you maintain the account. You also have the freedom to transfer these miles to more than a dozen travel loyalty programs that partner with Capital One.
0% Introductory APR For The First 15 Months
If you plan to make many large purchases within the first year or transfer your balance from another credit card, the Capital One VentureOne Rewards credit card offers 0% introductory APR on purchases for the first 15 months, with an ongoing reg_apr,reg_apr_type APR after that (credit-building credit card since it’s only available to those with excellent credit.
Like what you see? Learn how to apply for a Capital One VentureOne Rewards Card here
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Secured credit cards are designed to help individuals improve their credit history and score. However, these cards differ from traditional unsecured cards in a few ways, and it’s important to understand all the details before you apply for a secured card.
What Is a Secured Credit Card?
A secured card is one with a credit limit that’s secured by collateral you put up. In the case of these cards, the collateral is a cash deposit you make to secure the credit limit. Typically, your credit limit is equal to your deposit, and you may have an option for how much that is.
For example, some cards allow you to deposit $200 to $3,000 to open your card account. So if you choose to deposit $500, your credit limit will be $500.
Your deposit is held by the credit card company the entire time you have the card. If you fail to make payments on your balance in a timely manner, the credit card company may close your account and use the deposit funds to cover its losses. This reduces risk for the lender, which is why these card companies are willing to offer credit cards to people with no or bad credit.
Once you close your account—assuming you’ve paid off your balance—you get your security deposit back.
Other than the factors surrounding the security deposit, a secured credit card typically works like any other credit card. You can use it to pay for purchases anywhere it’s accepted—these are usually Visa or Mastercard cards, so they’re accepted widely. If you carry over a balance each statement cycle, you’ll be charged interest on it in keeping with the rates associated with your card.
Building Credit With a Secured Credit Card
Secured credit cards aren’t a magic elixir for your credit. You have to manage these accounts appropriately to get the benefits. Here are some tips for building credit with a secured credit card.
Don’t apply randomly for credit cards. Every application could result in a hard inquiry on your credit report, bringing your score down further. Instead, do your research. Check your own credit, and consider what type of credit the lender is looking for before you apply. That increases your chances of getting approved the first time.
Make sure the cardholder reports your payments. Credit card companies don’t actually have to report your payments—so some won’t report to any bureaus, while others report to just one or two. Ideally, you want to work with a secured credit card lender that will report to all three credit bureaus. That way, your timely payments can help you build your credit on each of your credit reports.
Make every payment on time. Failing to make a payment can result in a negative mark on your credit reports, which defeats the entire purpose of the card. It can also result in hefty missed payment fees, which increase your balance even more.
Don’t max out your credit limit. Try to keep your utilization below 30%. That means if you have a credit limit of $1,000, keep your balance at $300 or lower. Your credit utilization—how much of your credit limit you use—impacts your credit score.
Don’t expect your credit to improve immediately. It takes time to build your credit via any means.
Tools like our Credit Report Card can help you keep track of your credit score and the factors affecting it so you can make good and informed decisions when building credit.
How to Choose a Secured Credit Card
When shopping for a secured credit card, consider the following factors:
Likelihood of approval. Don’t apply for a card you know requires good or excellent credit if you have poor credit. That just creates unnecessary hard inquiries.
Annual fee. You want to pay as little as possible for the benefit of building your credit. A few secured credit cards have no annual fee, but most do. Look for options with the most competitive annual fees, which tend to be under $40 per year.
Credit reporting. The best secured credit card options are those that report to all three credit bureaus. Plenty of secured credit card companies do, so you don’t have to settle for one that doesn’t.
Competitive interest rates. Rates for bad-credit products tend to be higher than average in general. However, you can find secured credit cards with more competitive rates, and you should definitely compare these cards to each other to find the lowest possible rate.
Account management tools. Look for a card lender that makes it easy for you to manage your account well. Payment reminders, online portals and apps can keep you in the know about your balance and reduce the risks you’ll miss a payment.
Next Steps After Using a Secured Card
Once you’re approved for and start building credit with a secured card, continue to plan for your financial future. At some point, hopefully, your credit will improve enough that you qualify for cards with better rates, limits, and perks.
Once you establish new cards, you might consider closing your secured credit card account because you may not want to keep paying an annual fee on a card that no longer serves your needs. However, closing your account might hurt your credit by potentially increasing your credit utilization ratio and also by affecting your average credit age, so weigh the pros and the cons of closing your card before making a choice. Visit Credit.com to learn more about our products like ExtraCredit® that could help you stay on top of your credit.
Advertiser Disclosure: Credit.com has partnered with CardRatings for our coverage of credit card products. Credit.com and CardRatings may receive a commission from card issuers.
Editorial Disclosure:Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
Snapshot: Provided that you’re a student, you can gain access to fantastic cash back rates (anywhere from 1% – 10%, depending on the category), even if you have no prior credit. Did we also mention the annual_fees annual fee?
Pros
Cons
annual_fees annual fee
This card allows balance transfers but there’s no introductory APR for them
3% cash back on dining, select streaming services, entertainment and grocery store purchases
Potentially higher APR
A potential for relatively low APR for a student credit card
bonus_miles_full
Like what you see? Learn how to apply for the Capital One SavorOne Student Cash Rewards Card
Capital One SavorOne Cash Rewards Card – which you generally have to have at least a good credit score to qualify for (and it has a higher regular APR)*.
You get access to amazing cash back rates on dining and grocery shopping – which are common expenses – in addition to a flat 1% cash back on everything else. This card does have a relatively high APR (see how it compares to other cards) but no annual fee, so as long as you pay your statement on time, you won’t have to worry about interest. (Paying your credit card bill on time will also help you build good credit in preparation for your next card, auto loan, or apartment application, after you graduate).
When you’re just starting out on your own having no credit or bad credit can be a barrier to many things you need in adulthood, like an apartment lease, a car loan or a halfway decent credit card. You need credit to get credit, and most of the time the options aren’t great.
This card is great (actually). Like we said before, many of this card’s benefits are very similar to the card_name. But where you need great credit to qualify for that card, you can qualify for the same benefits by being in school.
So if you’re worried about a low credit score, or maybe you’ve just turned 18 and are starting out on your own and have no credit, provided that you’re a student (among other qualifying factors) this is a great credit card to apply for.
Great Rewards for Dining
If you’re cramming for a test and just don’t have the time to plan out meals and need to Uber Eats some food to keep the study session going uninterrupted, at least you’ll be making a whopping 10% (10%!) cash back on your splurge (through 11/14/2024). 3% cash back on grocery store purchases (excluding superstores like Walmart® and Target®) is also great – not only are groceries a regular expense, but 3% is a decently high rate for a cash back category.
Whether you’re the kind of shopper who loves spending time researching a great deal, or you don’t have the mental energy to pay attention to such things, this card has you covered. Not only does it have great cash back rates, but it also has a varied enough mix of rewards categories that you can earn cash back without having to go out of your way to make unusual purchases.
Like what you see? Learn how to apply for the Capital One SavorOne Student Cash Rewards Card
The Drawbacks
No Introductory APR
If you’re looking for a 0% APR offer, you won’t find it with this card. That means you can’t use this card to make a major purchase you can pay off over a year or two without accruing interest. That’s certainly not a deal breaker for most students, but it’s something to consider.
Potentially High APR
It’s hard to say what ongoing APR you will get when you apply for this card, the quoted range is quite wide at reg_apr,reg_apr_type. If you qualify for a lower APR, great! But if you end up paying a higher APR, that could be a drawback. Especially if you want to rely on this card to help you cover larger purchases.
Is It Worth It?
For students who eat out or grab coffee on the go a lot, this card may be a good option. It lets you earn decent cash back perks, and as long as you pay off your statement every month, that’s cash in your pocket.
What Are The Credit Limits For Capital One SavorOne Student Cash Rewards Card (Minimum and Maximum)?
Your credit limit is determined by your credit history and factors such as income. From what we’ve seen other users report, credit limits may range from $300 to $700 (at least initially), though approvals could certainly fall outside those ranges.
How Soon Can I Increase My Credit Limit After Being Approved For A Capital One SavorOne Student Cash Rewards Card?
Capital One may let you request a credit limit increase after 6 months, though approval of the increase is not guaranteed. During that time you will need to demonstrate that you can handle your credit responsibly, which means both using and paying off your bill on-time.
How Good Is A Capital One SavorOne Student Cash Rewards Card For Building Credit?
This is an excellent card for building credit because you don’t necessarily need great credit to get it. Capital One is a well-recognized credit card provider that typically reports payment history to the credit bureaus. That helps you build a stronger credit profile.
Learn more about how to apply for the Capital One SavorOne Student Cash Rewards Card here:
Advertiser Disclosure: Credit.com has partnered with CardRatings for our coverage of credit card products. Credit.com and CardRatings may receive a commission from card issuers.
When the Canada-based BMO bank acquired Bank of the West, headquartered in the U.S., in 2021, American consumers gained access to BMO’s credit card portfolio, which includes personal and business cards.
As of this writing, BMO offers two cash-back cards, a travel card, a 0% APR/balance transfer card and a secured card. However, a BMO representative confirmed that the card offerings and current card benefits may change in early 2024.
Here’s what you need to know about these cards before deciding whether to apply for one.
🤓Nerdy Tip
While BMO offers business credit cards, this article covers only its personal credit card offerings.
For a break on interest: BMO Platinum Credit Card
If you need an extra-long reprieve from interest, your best option among the BMO cards is the Platinum Credit Card. For a $0 annual fee, cardholders get 0% APR on purchases and balance transfers for 15 months (as of this writing). There are two important caveats to these offers, though: You may lose the 0% APR benefit if you make a late payment, and the balance transfer must be completed within 90 days of account opening in order to get the 0% APR offer.
The balance transfer fee for all of BMO’s personal credit cards is $10 or 4% of the amount of the balance transfer, whichever amount is greater. BMO only allows balance transfers of credit card debt. And as is standard with most issuers, it doesn’t permit transfers between BMO accounts.
As balance transfer offers go, this is a decent one, but it’s possible to find credit cards with longer interest-free promotions. The Wells Fargo Reflect® Card, for instance, offers 0% intro APR for 21 months from account opening on purchases and qualifying balance transfers, and then the ongoing APR of 18.24%, 24.74%, or 29.99% Variable APR .
🤓Nerdy Tip
All of BMO’s publicly available personal credit cards offer cell phone protection plans. Cardholders are eligible for up to $400 in coverage except for Premium Rewards cardholders, who get up to $600 worth of coverage. To qualify for cell phone insurance, you must pay your cell phone bill with a qualifying BMO credit card. A $50 deductible is required for each claim.
For building credit: BMO Boost Secured Credit Card
BMO’s lone secured card requires a $25 annual fee and a minimum $300 security deposit. Those numbers are on the higher end compared with other secured cards. The Discover it® Secured Credit Card, for example, has a $0 annual fee and a $200 minimum security deposit — and it earns rewards, which the Boost Secured card does not.
However, the Boost Secured does offer two benefits rarely found in other cards for people with bad or limited credit: cell phone insurance and rental car insurance.
For travelers: BMO Premium Rewards Credit Card
The only travel card in BMO’s credit card portfolio, the Premium Rewards card, offers some solid perks for a $79 annual fee, which is waived the first year. Some highlights:
15% bonus points on your account anniversary (15% of total purchases made in the previous year).
A sign-up bonus of 35,000 bonus points when you spend $5,000 within 3 months of opening your account (as of this writing).
Access to over 850 airport VIP lounges worldwide with Priority Pass Select, plus two complimentary visits to participating lounges.
No foreign transaction fees.
Lost or damaged luggage insurance.
By comparison, the venerable Chase Sapphire Preferred® Card awards a 10% points bonus on each account anniversary and doesn’t come with lounge access, and its annual fee is slightly higher than the Premium Rewards card. However, unlike the BMO Premium Rewards card, the Chase Sapphire Preferred® Card features travel partners to which you can transfer your points, often for outsize value.
The Premium Rewards card also earns the following rewards in BMO’s proprietary currency, Flex Rewards:
3 Flex Rewards points per $1 spent on eligible dining, hotels and airfare (on up to $2,500 in combined spending each quarter), and 1x on all purchases after that.
1 Flex Rewards point per $1 spent on all other eligible purchases.
Flex Rewards points may be redeemed for flights, hotels, merchandise, gift cards and statement credits, among other options. Point values vary depending on the redemption; cardholders can check the redemption value at www.bmoflexrewards.com.
Flex Rewards points don’t expire, assuming your account remains in good standing with BMO.
For cash back: BMO Cash Back Credit Card and the BMO Platinum Rewards Credit Card
Two BMO cards would be good picks as cash-back cards. One earns direct cash back as a percentage of each purchase; the other earns BMO’s proprietary currency, Flex Rewards, which can be redeemed for cash back in the form of statement credit.
BMO Cash Back Credit Card
For straightforward cash-back rewards, the aptly named BMO Cash Back Credit Card is probably the better choice. It has the higher rewards rates, and the rewards categories represent a range of everyday spending. The $0-annual-fee Cash Back card earns:
5% cash back on eligible streaming, cable TV and satellite services.
3% cash back on eligible gas and grocery purchases, up to $2,500 in combined quarterly spending (1% after that).
1% cash back on all other eligible purchases.
The only redemption option is a statement credit. Rewards never expire as long as the account is open and in good standing.
As of this writing, the card also comes with the following sign-up bonus: Get a $200 cash-back bonus when you spend $2,000 within 3 months of opening your account.
BMO Platinum Rewards Credit Card
The Platinum Rewards card, like its Cash Back sibling, earns rewards on gas and groceries, but the rewards rates on the Platinum Rewards card are a hair lower. It earns:
2 Flex Rewards points per $1 spent on eligible gas and groceries, up to $2,500 in combined spending each calendar quarter (1x on all purchases after that).
1 Flex Rewards point per $1 spent on all other eligible purchases.
Redemption options for the Platinum Rewards card are the same as the Premium Rewards card because both cards earn Flex Rewards.
In favor of the Platinum Rewards card, its annual fee is also $0, and it has a good welcome offer: Get 25,000 bonus points when you spend $2,000 within 3 months of opening your account. It also gives cardholders a points bonus every account anniversary equal to 10% of the total points earned in the past year. The Cash Back card doesn’t award an annual bonus.
These are both decent options for cash back. But if you’d prefer a simple, high flat rate back on everything, without the need to keep track of bonus categories, you could consider a product like the Citi Double Cash® Card. It earns 2% cash back on every purchase: 1% back when you buy, 1% back when you pay it back.
The card has a $0 annual fee, and it also offers a 0% intro APR on Balance Transfers for 18 months, and then the ongoing APR of 19.24%-29.24% Variable APR.
Who doesn’t want to be rewarded?
Create a NerdWallet account for personalized recommendations, and find the card that rewards you the most for your spending.
Launching a business often involves acquiring funding, which can come from personal savings, angel investors, or loans. However, these options may not always be readily available, leaving businesses reliant on lenders such as banks and government programs.
To assess a business’s creditworthiness and determine its suitability for a line of credit, lenders review the company’s credit profile. This assessment considers factors like payment history, credit usage, credit mix, and other financial indicators that reflect the business’s financial responsibility.
Establishing Business Credit: The Foundation for Growth
Building business credit is crucial for new businesses as it allows them to access financing, secure favorable terms on contracts, and establish a strong financial reputation. Here’s a step-by-step guide to establishing business credit:
Incorporate Your Business: Business credit is separate from personal credit, so incorporating your business as an LLC, C or S corporation, or LLP is essential for building a distinct credit profile.
Obtain an Employer Identification Number (EIN): An EIN serves as the IRS’s reference for tracking a company’s tax filings and is required for businesses with employees. Sole proprietorships are not mandated to have an EIN, but it’s recommended to protect personal credit from business liabilities.
Explore Supplier Credit: Supplier credit involves extending payment terms for purchases, allowing businesses to access supplies and pay for them later. This option is particularly beneficial for startups with limited cash flow.
Leverage Vendor Credit: Vendor credit provides essential services or products on short-term financing terms, typically with minimal requirements. Net 30 accounts, where payment is due within 30 days, are a common form of vendor credit.
Utilize Service Credit: Consistent and timely payments for services like internet, web hosting, cable, power, and cellphone airtime can also contribute to building business credit. These deferred payment contracts demonstrate a business’s commitment to financial obligations.
Consider Retail Credit Cards: Retail credit cards are often easier to obtain than traditional business credit cards and may offer rewards like cashback, points, and discounts. These cards are typically limited to a single store or a major retailer’s network.
Apply for Business Credit Cards: Business credit cards provide access to revolving credit, allowing businesses to charge company expenses and steadily build their credit profile. These cards can be used for various expenses, including licenses, insurance, taxes, utilities, payroll, supplies, and marketing.
The Path to Success: Building Credit Over Time
Establishing business credit takes time, especially for startups. However, by utilizing financial tools like supplier credit, retail credit, and business credit cards, businesses can cultivate a strong credit profile and pave the way for future growth and success.
Advertiser Disclosure: Credit.com has partnered with CardRatings for our coverage of credit card products. Credit.com and CardRatings may receive a commission from card issuers.
Editorial Disclosure:Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
Snapshot: This card is great if you have a weaker credit score and are looking to access a potentially larger line of credit than most credit cards for bad credit offer. It’s a simple approval process, and with at least 6 months of responsible behavior you can be considered for a credit line increase. Did we mention the $0 annual fee?
Pros
Cons
No annual fee
Higher ongoing APR at reg_apr,reg_apr_type
Simple approval process
No rewards
Credit bureau reporting
No introductory rate or bonuses
Potentially be approved a for a credit line increase in as little as 6 months
Like what you see? Learn how to apply for a Capital One Platinum credit card!
good credit cards for bad credit, we look at the following:
What’s the approval process like? Is a credit check required? Or a secured deposit?
Is there an annual fee?
How soon (if ever) can you increase your line of credit?
Many bad credit cards require an annual fee, a secured deposit, offer a very small line of credit, and may have a low cap on credit increases – if they offer them at all.
So, if you’re dealing with a low credit score that may make it difficult for you to qualify for a typical credit card, we recommend the Capital One Platinum Credit Card. This card has a simple application process (you can see if you’re approved very quickly) and Capital One may consider you for an increased line of credit in as little as 6 months.
Heads up: it does have a higher APR of reg_apr,reg_apr_type. Although it’s a comparable APR to other Capital One credit cards. So if you are considering this card, be sure to pay off your balance every month in order to avoid paying interest.
balance transfers, the Capital One Platinum credit card may not be the best option.
Is It Worth It?
Yes – if you have a lower credit score. If you’re looking for a solid credit card to help build your credit and allow you to access a larger line of credit, this card could be a great choice. With no annual fees, guaranteed credit bureau reporting and periodic credit reviews, this card can help improve your credit. It does come with a higher APR than some other credit card options, but it’s competitive with similar credit-building cards.
Like what you see? Learn more about how to apply for a Capital One Platinum Credit Card!
What are the Credit Limits for the Capital One Platinum Credit Card (Minimum and Maximum)?
Capital One bases credit limits on various factors, such as your credit history and income level (why we say variable). With this card, your credit limit can increase over time based on your payment history and other factors.
How Soon Can I Increase My Credit Limit After Being Approved for a Capital One Platinum Credit Card?
One of the main benefits of the Capital One Platinum credit card is that it offers automatic account reviews. Depending on your specific situation, you could be eligible for a credit limit increase in as little as 6 months.
How Good is a Capital One Platinum Credit Card for Building Credit?
The Capital One Platinum credit card is great (ideal!) for building credit. Special features, such as automatic credit reviews, credit bureau reporting and credit score monitoring, can all help you build your credit over time.
Ready to learn how to apply for a Capital One Platinum Credit Card?
Advertiser Disclosure: Credit.com has partnered with CardRatings for our coverage of credit card products. Credit.com and CardRatings may receive a commission from card issuers.
Renting a house or apartment comes with several perks, like minimal commitment to live in one place. After a certain point, however, most people want to put down roots and purchase their own home.
Owning your own home is the American Dream. Plus, you won’t have a landlord breathing down your neck about what you can and can’t do. But what kind of credit score is needed to buy a house?
We’ve got the answers, plus some extra tips on how to seal the deal, no matter what kind of credit score you have.
How does your credit score affect buying a home?
Your credit score influences your ability to buy a home as a major factor in whether you’re approved for a mortgage. That’s because your credit score is a reflection of how likely you may be to default on your loan.
Weighing all the items on your credit reports, such as payment history and amounts owed, a complex calculation then creates your FICO score. FICO scores are the credit scores that 90% of lenders use. They give mortgage lenders a better idea of how you handle your finances.
Even after you’re approved for a loan, your FICO score also affects the interest rate on your mortgage. Why is that a big deal? Well, depending on how expensive your loan is, you’ll likely end up paying tens of thousands of dollars (if not more) in interest. That’s on top of your principal loan amount.
An interest rate of even just ¼ percent less can save you a lot of money over the course of a 30-year loan. So, it’s clear that your credit history is an important factor not just for getting approved, but also for getting the best interest rates to lower your monthly payments.
Ready to Raise Your Credit Score?
Learn how credit repair professionals can assist you in disputing inaccuracies on your credit report.
What credit score do you need to buy a house?
The minimum credit score needed to buy a house can vary based on the economy and the housing market. However, there are some basic guidelines you can go by to determine how likely you are to be approved for a home loan. First, the minimum credit score depends on the type of mortgage you’re getting.
Conventional Loans
For conventional loans, which come with the strictest lending standards, the credit score needed to buy a house is 620. With a conventional loan, the minimum down payment is 5%, but could also increase based on your credit scores.
FHA Loans
FHA loans are insured by the Federal Housing Administration. For an FHA loan, the minimum credit score requirement is just 580 with a down payment of 3.5%. It’s possible to qualify for an FHA loan with a FICO score as low as 500, but you’ll need a 10% down payment.
Different mortgage lenders have different credit score requirements depending on how much risk they’re willing to take on a loan. Furthermore, you may be required to pay private mortgage insurance for the life of the loan, depending on the size of your down payment.
VA Loans
For VA loans, the U.S. Department of Veterans Affairs has no minimum credit score requirements. However, most VA loan lenders require a minimum credit score of 620. However, some will allow a credit score as low as 580.
USDA Loans
For qualified buyers purchasing a home in designated rural areas, there is no set minimum credit score from the USDA. However, a credit score of at least 640 is recommended.
What factors determine your credit score?
It’s crucial to know what factors affect credit scores so you can plan the most effective way to build or protect your credit.
Payment history: This is perhaps the most important factor, as it accounts for 35% of your overall credit score. Payment history includes whether you have paid your bills on time in the past and any negative marks, such as late payments, collections, or bankruptcies.
Credit utilization: This accounts for 30% of your credit score and refers to how much of your available credit you are using. A high credit utilization ratio could hurt your credit score, while a low one can help.
Length of credit history: This factor accounts for 15% of your credit score and is a measure of how long you have been using credit. Generally, the longer your credit history, the better your credit score will be.
Credit mix: This factor accounts for 10% of your credit score and refers to the types of credit you are using. A good credit mix includes a variety of different types of credit, such as credit cards, student loans, mortgages, etc.
New credit: This factor accounts for the remaining 10% of your credit score and refers to how often you are applying for new credit. Applying for too much new credit in a short period of time can hurt your credit score.
See also: Does Buying a House Hurt Your Credit?
Average Credit Score
The average credit score for buying a home is 680-739. However, those who have a “good” credit score of 740 and higher will be offered the best mortgage rates.
It’s important to check your credit score to know where you stand. However, your credit score alone doesn’t determine whether you’ll be approved. Mortgage lenders also look at your employment history, how much debt you have, and your down payment amount.
For example, buyers with higher credit scores could be eligible to put down as little as 3.5% of the mortgage loan amount with an FHA loan.
However, those with a lower credit score, may be required to pay as much as 10% since mortgage lenders consider them to be more at-risk for defaulting on the loan.
See also: Which Credit Scores Do Mortgage Lenders Use?
More Options for First-Time Homebuyers & Low-Income Borrowers
You can also explore newer mortgage programs available for homebuyers with low to moderate-income. The Freddie Mac Home Possible mortgage, for example, allows you to purchase a home with a down payment of just 3%. Fannie Mae also offers a 3% down payment option with the HomeReady loan, as long as you have a credit score of at least 620.
What else do you need to get approved?
In addition to your credit scores, your mortgage lender looks at a few other factors to approve your home loan. They’ll review your employment situation to make sure you have a steady income to make your monthly mortgage payments.
You’ll most likely need to submit pay stubs, bank statements, W-2s, and sometimes even a verification of employment form. If you’re serious about purchasing a home, start setting these documents aside in a safe place so you have them ready to give to your lender when the time comes.
Not only does the lender look at your debt-to-income ratio and other financials, but they’ll also check out the actual home you’re purchasing. Some types of home loans require the house to be in a certain condition, which can take rehabilitation projects off the table.
Before making an offer, check with your lender on what types of properties you can consider. That allows you to avoid making an offer you can’t follow through on. The property’s appraisal also needs to come in at or above the amount of the loan because a lender cannot loan more than the appraisal value.
Can you get a mortgage with bad credit?
You can still get a mortgage even if you have bad credit, although you’re likely to pay a much higher interest rate to compensate for the increased risk to the lender.
Government-backed loans, like FHA loans, specifically cater to borrowers with lower credit scores. But even if you’re not certain that you’ll qualify, it’s worth offering some extra security to your lender.
For example, you might give a larger down payment or set aside extra cash reserves to show the lender you have the money to repay the mortgage loan. Or you might give proof that you’ve consistently paid your rent on time for an extended period.
Check Out Our Top Picks for 2023:
Best Mortgage Loans for Bad Credit
You could also try writing a letter to explain your credit situation. This can be done, especially if it’s due to an extenuating circumstance like emergency medical bills. Be upfront in asking your lender what you can do to qualify for a loan, even if you might not meet the usual underwriting standards right away.
If you’ve had a bankruptcy or foreclosure in your past, there are a few rules that you simply can’t get around. The exact specifics depend on your loan type.
However, in general, you have to wait for a predetermined “seasoning period” after the bankruptcy or foreclosure has been discharged before you can get approved for a home loan.
For bankruptcies, the seasoning period is typically between two and four years. For foreclosures, you’ll need to wait between three and seven years.
Can a cosigner help you qualify for a mortgage?
Home buyers with a low credit score may want to consider getting a cosigner to help with their mortgage application.
If you can get someone who has a good credit score (such as a family member) to sign the loan with you, it will strengthen your loan application. Just remember that your cosigner is equally accountable as you are for repaying the loan.
If you fail to make loan payments and your account goes into delinquency or even foreclosure, it will affect the cosigner’s credit.
If you decide to take on a cosigner to get approved, make sure that person understands the responsibility and risk that goes into the decision. It obviously takes a close relationship for this kind of situation to work out, so make sure you choose your cosigner wisely.
What if you don’t have any credit at all?
Building credit from scratch is challenging, but it can be done. Adding a cosigner to the mortgage loan application works for people with no credit as well as for those with poor credit. Another option is to start using a credit card responsibly.
Start with a secured card and make your monthly payment in full each month to build credit. Or ask a close relative if you can be added as an authorized user on one of their credit cards.
You can agree not to spend anything (or make quick payments if you do). This simple step will add that credit card’s entire length of use to your credit report.
You can also show your lender that you’ve regularly paid other bills on time, like your cell phone, utilities, or rent. Another method is to make a bigger down payment to compensate for your lack of credit. Talk to your lender to see what else you can provide to make the loan work.
How can you improve your credit to qualify for a mortgage?
There are several ways you can improve your credit score; just realize that it won’t happen overnight.
Order Copies of Your Credit Report
Get started by ordering copies of your credit report. This way, you can get an idea of everything a lender would see when reviewing your loan application.
First, check to make sure that all the information is 100% accurate. From there, look at where there are weaknesses on your report. Is the amount of debt you owe really high?
Lower Your Credit Utilization
Attempt to re-work your budget to pay off your credit card balances and other debt. This will lower your credit utilization ratio and ultimately increase your credit score.
Is your available line of credit minimal? Ask an existing creditor to extend your maximum amount on one of your current credit cards. This will also lower your credit utilization.
Get Negative Items Removed From Your Credit Report
If you have numerous negative marks on your report and feel overwhelmed, you might consider hiring a credit repair company.
Take a look at our list of top ranked credit repair companies in your area to find a reputable one to work with. They’ll take the lead in disputing negative accounts with the credit bureaus and getting them removed from your credit history. Once that happens, you’ll automatically see your credit score increase.
Even if you don’t have the bare minimum credit score to qualify for a mortgage, there are many ways to buy a house. From getting the right loan to improving your credit score, you’ll be able to quickly put yourself on the path to homeownership.
Advertiser Disclosure: Credit.com has partnered with CardRatings for our coverage of credit card products. Credit.com and CardRatings may receive a commission from card issuers.
Editorial Disclosure:Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
Snapshot: The Capital One Venture X Rewards credit card is an ideal option for those with excellent credit who want a premium travel rewards credit card. Cardholders can earn up to 10 miles per dollar on travel booked through Capital One Travel and 2 miles per dollar on all other purchases.
Pros
Cons
Earn up to 10 miles per dollar
annual_fees annual fee
Receive 10,000 bonus miles every year
Must have excellent credit
Earn a $300 statement credit when booking with Capital One Travel
Miles aren’t as flexible as some travel rewards programs
Like what you see? Learn how to apply for the Capital One Venture X Rewards credit card
flight reservations and 10 miles per dollar on hotel and car rental reservations.
Annual Rewards
In addition to a nice welcome bonus and ongoing rewards, you can receive consistent annual awards, like a $300 annual credit to use for bookings through Capital One Travel. You also get 10,000 bonus miles every year (starting on your first anniversary of opening your account).
Welcome Bonus
The Capital One Venture X Rewards card does have a welcome bonus. If you spend $4,000 on purchases in the first 3 months of opening your account, you can earn 75,000 bonus miles.
Note: This one-time bonus is available by clicking the “Learn How to Apply” button on this page, and may not be available if you navigate away from or close this page. The bonus may not be available for existing or previous Spark cardholders.
Extra Perks
The Capital One Venture X Rewards credit card also comes with all the features you would expect from a premium credit card, including free additional cardholders, $0 fraud protection, no foreign transaction fees and cell phone protection.
Like what you see? Learn how to apply for the Capital One Venture X Rewards credit card
consider other options.
High Annual Fee
You also must pay a annual_fees annual fee. This might seem steep, but like we said above, this annual_fees fee isn’t as high as what other premium travel rewards cards charge.
Is It Worth It?
Yes, if you need the miles and are willing to book your reservations through Capital One Travel, this is a great deal for a premium travel card. Earn travel rewards on your everyday purchases, earn annual rewards, and gain access to premium perks – what more could you ask for?
Like what you see? Learn how to apply for the Capital One Venture X Rewards credit card
credit limits on your specific information, including your credit score and income level. Because Capital One doesn’t publish their credit limits (minimum or maximum) we can’t definitively tell you what to expect. We can tell you that your credit limit will be unique to you.
How Soon Can I Increase My Credit Limit After Being Approved For A Capital One Venture X Rewards Credit Card?
Capital One periodically reviews accounts for credit limit eligibility. You can also request a credit limit increase if you’ve had your Capital One Venture X Rewards credit card for several months, have a good payment history and haven’t applied for any other Capital One card in the last 30 days.
How Good Is A Capital One Venture X Rewards Credit Card For Building Credit?
The Capital One Venture X Rewards credit card is not a credit-building card because you must have excellent credit to qualify.
Like what you see? Learn how to apply for the Capital One Venture X Rewards credit card
Advertiser Disclosure: Credit.com has partnered with CardRatings for our coverage of credit card products. Credit.com and CardRatings may receive a commission from card issuers.
Merrick Bank issues credit cards designed for consumers who are building credit. Payment activity on the cards is reported to the three major credit bureaus, meaning careful card use can help you establish your credit over time.
Indeed, credit-building is the main benefit of the Merrick Bank credit cards. There are no other perks, like a 0% interest promotion or cash-back rewards. Plus, you may be on the hook for a few pricey fees, making other starter credit cards or cards for bad credit more appealing options to consider.
Here are five things to know about the Merrick Bank credit cards.
1. There are two Merrick Bank credit cards
Merrick Bank issues two credit cards:
The Merrick Bank Classic Secured Credit Card, which requires a security deposit of $200 to $3,000.
The Merrick Bank Double Your Line Credit Card, an unsecured card that automatically doubles your credit limit after the first seven months if you make at least the minimum payment on time each month.
2. You may need an offer by mail to apply
The Merrick Bank Double Your Line Credit Card requires a mailed offer before you can apply. Enter the certificate number that appears in the offer to start the application. You can also search for your certificate number by entering your last name, last four digits of your Social Security number and ZIP code on the card’s website.
You can apply for the Merrick Bank Classic Secured Credit Card online without a mail offer.
3. Get ready to pay some fees
For the Merrick Bank Classic Secured Credit Card,the annual fee is $36 for the first year, after which the fee is still $36, but it’s charged in monthly increments of $3. As of this writing, the APR is more than 22%.
Things get a little pricier with the Merrick Bank Double Your Line Credit Card. It charges high interest rates — as of this writing, the variable APR tops out at nearly 31%. Plus, there are a couple of potential fees you may have to pay depending on what Merrick Bank determines: a one-time account setup fee of $0 to $75, and an annual fee of $0 to $72 (billed at up to $6 monthly after the first year).
High interest rates and fees are common for unsecured credit cards for bad credit. However, depending on what you can qualify for, you may find other cards’ fees to be more affordable.
4. Neither card offers perks
The main benefit of both of these cards is access to credit and the ability to build credit through careful use. And the Merrick Bank Double Your Line Credit Card will, as its name implies, bump up your credit limit after a few months. Otherwise, there are no cash-back rewards or sign-up bonuses to sweeten the deal.
There are alternatives that offer more extras, even for those who are newer to credit-building. The Capital One Quicksilver Secured Cash Rewards Credit Card has a $0 annual fee and earns 1.5% cash back on all purchases. It has a $200 minimum deposit, and you can be automatically considered for a credit limit increase after six months.
The Discover it® Secured Credit Card also has a $0 annual fee and $200 minimum deposit. It earns 2% cash back at gas stations and restaurants on up to $1,000 in combined spending per quarter (then 1% back), and 1% cash back on everything else. New cardholders can also get this sign-up bonus: INTRO OFFER: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. Just a dollar-for-dollar match.
5. There are no other Merrick Bank credit cards to graduate to
As you more firmly establish your credit history, you’ll potentially become eligible for a greater variety of credit cards, including rewards cards with more appealing benefits. However, you won’t be able to stick with Merrick Bank credit cards if you eventually want those extras. And even though unsecured cards are the typical next step after secured cards, the Merrick Bank Double Your Line Credit Card faces some serious competition from lower-fee cards with more to offer.
The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.
Yes, it’s possible to get a credit card without a job, although you’ll usually still need a source of income. This could come from excess financial aid, Social Security, a spouse’s income, or other avenues.
Yes, you can get a credit card without a job—and sometimes, even with low credit. Life transitions, college, retirement, and many other life circumstances may mean you’re unemployed when applying for a credit card. Building and maintaining healthy credit is important during every stage of life, and you may be surprised how simple it is to obtain a credit card even if you aren’t earning a consistent wage.
From using alternative incomes to cosigning and more, here are four tips for how you can get a credit card with no job.
Table of contents:
1. Consider all forms of income
2. Leverage someone else when applying
3. Go for a secured credit card
4. Make sure you can pay your balance
FAQ
1. Consider all forms of income
Ultimately, lenders care more about your income than they do about your salary. This means that qualifying for a credit card—even if you aren’t receiving a consistent wage—is completely feasible. Consider all income you have access to when applying for a credit card, no matter what stage of life you’re in.
If you’re a student
When you’re applying for a credit card as a student without a job, you can report any extra student aid that isn’t going toward tuition as “income.” This may help you qualify for a credit card.
If you have an employed spouse
Thanks to the Credit Card Act of 2009, those who are over 21 can report household income that they have access to when applying for a credit card. This means that you can report your spouse or partner’s income if you have a joint bank account or if they transfer an amount of money to you every month.
If you’ve lost your job
After losing a job, you’ll want to avoid overextending your budget. However, a credit card can still be a useful safety net in case of an unforeseen situation when funds are tight. You can report unemployment and severance as income when applying.
If you’re retired
You may also report any non-wage income when applying for a credit card. If you’re not working, this could be interest, dividends or Social Security payments. Ideally, retirees have had a long time to build up a solid credit history, so getting qualified for a credit card shouldn’t be difficult.
2. Leverage someone else when applying
We all need a little help from time to time. If they’re willing, friends and family with good credit may be able to cosign or add you as an authorized user on their credit card.
Have someone cosign
Although it’s a big favor to ask someone, having a parent or trusted close friend cosign on a credit card is a great way to qualify if your own credit history isn’t sufficient. If you choose this route, it’s doubly important that you make on-time payments each month—otherwise, you jeopardize both your own credit score and your co-signer’s.
Become an authorized user
If you still live with your parents, you may want to consider asking them to add you as an authorized user on their card. You can then use their credit card to make purchases and pay them the amount you spent. Although the card won’t be yours, as long as the primary cardholder makes consistent payments, the effects to your credit score will likely be positive. This option is best for those looking to build credit—but if you’re looking for a card of your own, a secured card may be better.
3. Go for a secured credit card
If you’re unable to meet the criteria to qualify for an unsecured credit card, you may want to explore secured options. Although uncommon—secured cards make up less than one percent of all consumer credit cards—they’re a great place to start.
A secured credit card is a card with relatively small maximums that borrowers can qualify for with a refundable safety deposit. The creditor may then use the deposit as collateral in case you are unable to pay back the balance.
New borrowers, those with poor credit or those without a steady income may find it easier to qualify for unsecured credit cards, as they’re seen as less risky by lenders. Two common secured credit card options are:
Discover It Secured Card: There’s no annual fee, and you get two percent cash back at restaurants and gas stations and one percent back everywhere else.
Capital One Secured Mastercard: A deposit as low as $49 gets you a credit limit of $200, and you are eligible for higher credit limits in as little as six months.
4. Make sure you can pay your balance
Remember that if you’re applying for a credit card without a job, you must be able to pay off the balance. Avoid getting into a borrowing situation that will cause you to carry over a large balance month to month, as credit card interest can get expensive.
Additionally, if you’re in college with student loans, credit card debt can be an extra burden on your debt load. In fact, a 2021 report found that credit card debt was the number one source of financial stress for college students, even above student loan debts.
As long as you don’t charge more than you can afford, unemployment doesn’t have to be a barrier to credit building. By ensuring a responsible, on-time repayment plan, you’ll set yourself up for credit success early on.
FAQ
If you have other questions about getting a credit card while unemployed, check out our answers to these commonly asked questions.
Does unemployment affect your credit?
Unemployment does not directly affect your credit. While your credit report does include your repayment history, it does not include your income, employment status, or whether you’ve filed for or received unemployment. If you need to apply for unemployment during hard times, don’t feel like you can’t.
However, if your job loss results in missed payments or overutilizing your credit card, these things could affect your score.
What’s a good annual income to get a credit card?
This depends on the issuer. While income won’t appear on your credit report or affect your credit score, issuers are still legally required to ask applicants their income per the Credit Card Act of 2009. This helps ensure credit borrowers can repay their debts. However, issuers set their own credit application requirements, and no total gross income limit for credit cards exists.
Remember to only borrow what you can reasonably repay. If you’re applying for a credit card with no income of your own, consider alternative solutions, like becoming an authorized user on a spouse’s credit card.
What disqualifies you from getting a credit card?
Credit card application approvals are at the issuer’s discretion, but generally, you must be at least 18 years old to open an account under your own name. Between 18 and 21 years old, you’ll also need to provide proof of independent income or have an adult cosign. Otherwise, issuers can set their own income, credit score and other requirements.
Can students get a credit card with no job?
Yes! Students who receive financial aid in excess of their tuition costs can count this extra money as income on their credit card applications. If this isn’t enough to qualify, students can also ask their parents to cosign on the credit card application—or add them as an authorized user to a family card.
What should I put on my credit application for my occupation if I have no job?
You can simply enter homemaker, stay-at-home parent, or none. Remember, you don’t need a job to get a credit card, so being honest here won’t disqualify you. The same thing goes if you come to a question about your employer information: just be honest and put none.
For more ways to improve your credit, especially if you have questionable negative items on your credit report, learn more about the services at Lexington Law Firm—including how credit repair works.
Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.
Reviewed By
Paola Bergauer
Associate Attorney
Paola Bergauer was born in San Jose, California then moved with her family to Hawaii and later Arizona.
In 2012 she earned a Bachelor’s degree in both Psychology and Political Science. In 2014 she graduated from Arizona Summit Law School earning her Juris Doctor. During law school, she had the opportunity to participate in externships where she was able to assist in the representation of clients who were pleading asylum in front of Immigration Court. Paola was also a senior staff editor in her law school’s Law Review. Prior to joining Lexington Law, Paola has worked in Immigration, Criminal Defense, and Personal Injury. Paola is licensed to practice in Arizona and is an Associate Attorney in the Phoenix office.