Best Cards for Fair Credit of June 2021

Capital One Platinum Credit Card

Why this is one of the best credit cards for fair credit: For consumers with fair credit, Capital One Platinum Credit Card is a good starter product. You won’t pay an annual card fee, and if you make on-time payments for six months, you will be automatically considered for a higher credit limit. See our full review.

Capital One QuicksilverOne Cash Rewards Credit Card

Why this is one of the best credit cards for fair credit: Capital One QuicksilverOne Cash Rewards card is a good product for people with fair credit. You’ll earn 1.5% cash back on all of your purchases: a solid perk that is above average for fair credit. The card charges a $39 annual fee, but with good credit behavior, you can eventually move into a no-fee card. See our full review.

Chase Freedom® Student credit card

Why this is one of the best credit cards for fair credit: Students earn 1% cash back on every purchase and won’t need to track complicated spending categories. The card also delivers 4% back on Lyft ride-hailing purchases through March 2022. See our full review.

Discover it® Student Cash Back

Why this is one of the best credit cards for fair credit: The Discover it Student Cash Back Card offers 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. The card offers unlimited 1% cash back on all other purchases. Discover will match all the cash back you’ve earned after your first year. There’s no annual fee and no late fee the first time you pay late. See our full review.

Journey Student Rewards from Capital One

Why this is one of the best credit cards for fair credit: The Journey Student Rewards from Capital One is designed for students with fair credit and earns 1% cash back on everything. Students who pay on time will get extra credit – and earn 1.25% back for that month. See our full review.

Discover it® Student chrome

Why this is one of the best credit cards for fair credit: This card is designed for individuals who primarily spend on gas and dining. Cardmembers earn 2% cash back at gas stations and restaurants, on up to $1,000 in combined purchases each quarter. All other purchases earn unlimited 1% cash back. Discover will match all the cash back you’ve earned after your first year. See our full review.

When you apply for a credit card, the card’s issuer will likely pull your credit report and use a credit score to help determine whether you qualify. Many issuers use a base FICO Score, which ranges from 300 to 850, or a FICO Bankcard Score (an industry-specific credit score for card issuers) that has a 250 to 900 range to screen applicants. With both scores, FICO defines fair credit as a score of 580 to 669.

“Generally speaking, consumers with fair credit have made some credit missteps along the way,” says Heather Battison, vice president at TransUnion, one of the three major consumer credit bureaus. “Simple actions like paying bills in full and on time each month, establishing a positive payment history, and maintaining a low debt-to-credit ratio demonstrate responsible credit management to lenders.”

A credit card can help you build that positive payment history, as many cards report your activity to all three major consumer credit bureaus. If you have fair credit, you won’t be able to get approved for every credit card. However, choosing a card with few fees, a low interest rate or a rewards program could save you money.

Opening a new account can have a negligible negative effect on your score. But adding a new credit card with positive payment information and increasing your overall available credit will more than offset the temporary hit.

If you decided to open a rewards card, be careful with the temptation to make purchases just to get points or miles. Battison says cardholders should remember that rewards cards “return only a fraction of what you spend and should never be used as justification for spending more than you can afford.”

Carrying a balance can also affect your credit score because about 30% of your score depends on your utilization rate, the percentage of your credit limit that you use. The lower your utilization rate, the better, so try to only use a small portion of your available credit.

If you do make a lot of purchases with your credit card, you could pay down part of the balance early. Doing so will lower your statement balance, which is what the card issuer reports to the bureaus, and by extension, lower your utilization rate.

“Over time, a history of responsible borrowing and positive credit health can help consumers in the fair credit tier,” Battison says. As a result, you may be able to “secure more favorable interest rates and loan terms, and access subsequent credit down the line.”