Credit cards can be intimidating. They often require that you have a high credit score to qualify. Unfortunately, it’s not always easy to maintain a high score.
It’s easy to make financial mistakes. Many people wish they could undo mistakes they’ve made with their credit. In some cases, the effects of a bad credit decision can last for years.
For this reason, cards that offer no credit checks can be appealing. Many people believe that they can get credit without affecting their scores. Others believe they can get a reliable card with bad credit.
This is not necessarily the case.
Card companies that claim no credit checks are often predatory. It’s important to know the truth before you proceed.
Do Credit Cards Without Credit Checks Exist?
There are credit cards that offer lines of credit without a credit check. Many people think these cards will preserve their credit. Unfortunately, this usually isn’t the case.
These cards come with high interest rates and many fees. The company must accommodate for not knowing your credit history and risk. They offset this by making you pay in other ways.
How Do You Get a Credit Card with No Credit Check?
If you decide to proceed with a no-credit-check card, be careful. Find a reputable review, and be sure to read the fine print.
Follow the application instructions exactly and be honest. The company needs a great deal of information before approval. Many of these applications can be completed online.
Secured Credit Cards
Reputable credit cards with no credit check are often secured credit cards. This means that the company requires a deposit to secure your card. If you can’t pay your bill, they keep the deposit.
This is nearly always the case for credit cards with no credit check. Without any credit information, companies need to ensure payback. This is the trade-off to avoiding a credit check.
The credit limit for your card will depend on your unique situation. Limits will also depend on your secured deposit. For example, with a $1,000 deposit, you can borrow up to $1,000.
Alternatives
No credit check cards are sometimes not the right avenue. Fortunately, there are alternatives if you’re rejected or want other options.
Paying for utilities is a great way to build credit. Consider putting energy and water bills for your home under your name. These companies report to credit agencies, and paying on time helps.
To ensure that your utilities benefit your credit score, set up autopay. This ensures payments are always on time.
You may also become an authorized user on another person’s card. This helps to build your credit without requiring your own account. Close friends or family members are usually good candidates.
Before you become an authorized user, check the other person’s credit. Be sure they are responsible and have a good credit score. If they don’t, the process could do more harm than good.
The Bottom Line
Remember: you could apply for a secured card from a reputable company. This is a far safer option than accepting a no-credit-check scheme. Avoiding a credit ding is not worth the fees and interest rates.
A secured card is a safe and beneficial way to rebuild credit. You can often be accepted with a low score or no score.