When you have less-than-perfect credit, finding an unsecured card that you can qualify for and won’t take advantage of can be difficult. Difficult, but not impossible. We’ve researched all the options and created this list of the best second-chance credit cards with no security deposit.
What Is a Second-Chance Credit Card?
A second-chance credit card is one with low eligibility requirements designed to help you rebuild your credit after making financial mistakes. These cards often have limited features and benefits and can come with hefty APRs and fees.
The goal of opening a second-chance credit card is to add positive data to your credit reports, like on-time payment history and low credit utilization. Second-chance credit cards are meant to be held short-term. Once you qualify for a better card, you will want to upgrade.
What Is the Minimum Credit Score Needed?
Most card issuers do not post a minimum credit limit, though they may include stipulations about what kind of negative information can be on your credit reports. For instance, some second-chance credit cards permit you to have a bankruptcy, while others don’t.
Many second-chance cards also weigh other information, such as your income or banking history. This gives you better odds of qualifying when you have a low credit score.
💳 Learn more: If you’re navigating the financial realm with a challenging credit score, our recent post delves into the best-unsecured credit cards for bad credit.
5 Best Second-Chance Credit Cards with No Security Deposit
BEST NO-FEE CARD
Capital One Platinum Mastercard
The Platinum card from Capital One is a no-fee, unsecured credit card available to those with less-than-perfect credit. Learn more
Annual Fee:
$0
APR:
30.49%
BEST CUSTOMIZABLE CARD
Credit One Platinum
The customizable Platinium card from Credit One has a reasonable APR and offers up to 10% cash back earnings from select merchants. Learn more
Annual Fee:
$99 ($75 first year)
APR:
28.99%
BEST LOW APR OPTION
Milestone Gold Card
Designed for bad credit, the Milestone Gold Card Mastercard offers a lower APR than most other cards in this category but has a tiny credit limit. Learn more
Annual Fee:
up to $99
APR:
24.99%
BEST FOR CASHBACK REWARDS
Petal 1 Rise
Petal 1 Rise is a card with a great cashback rewards program that caters to those rebuilding their credit. Learn more
Annual Fee:
$59
APR:
28.24% – 35.49%
BEST FOR IMPROVING YOUR CREDIT
Surge
The Surge card is a decent short-term credit-building card with limited features. Learn more
Annual Fee:
up to $125
APR:
29.99%
1. Capital One Platinum Mastercard
🏆 Best No-Fee Card
The Platinum card is among the best second-chance credit cards with no security deposit, zero fees and a decent maximum credit line. However, it’s worth noting that it might be the most challenging card on our list to qualify for.
Capital One advertises that you need fair credit to qualify for this card. They define this as “limited credit history” or “I’ve defaulted on a loan in the past 5 years.”
With the Platinum card, you get access to all of Capital One’s benefits, such as a solid mobile app, Capital One’s CreditWise service, fraud protection tools, and more.
➕ Pros:
- No annual fee
- Decent credit limit
- No foreign transaction fees
➖ Cons:
- High APR
- No rewards
| Fees & Features | |
|---|---|
| Credit Line | Up to $3,000 |
| Annual Fee | $0 |
| APR | 30.49% |
| Balance Transfer Fee | 3% |
| Late Payment Fee | $40 |
| Rewards | None |
Using This Card to Improve Your Credit
You can prequalify for the Platinum card without risking a hard inquiry that will hit your credit.
Once you have the card, Capital One performs automatic reviews of your credit starting at 6 months. If the review is favorable, they can extend a credit limit increase. You can also monitor your score progress using the CreditWise tools and resources.
Because this card has no monthly or annual fees, there is no cost to keeping the Platinum card long-term. Once you qualify for better cards (higher rewards, lower APR, etc.), you can simply sock drawer this card and/or continue using its benefits (i.e., no foreign transaction fees).
💳 Learn more: For those weighing credit card choices, our recent post offers a comprehensive look at the Capital One Secured Credit Card and its features.
2. Credit One Platinum
🏆 Best Customizable Card
The second on our list of best second-chance credit cards with no security deposit is the Credit One Platinum card which has some unique customization features. This includes selecting your own due date, creating specific account alerts, and personalizing your card design.
The Platinum card is advertised for rebuilding credit. Unfortunately, this means some of the terms aren’t that great. I.E., there is an annual fee and a low starting credit limit. That said, there are some decent Credit One benefits, like cashback earnings and automatic credit limit reviews.
➕ Pros:
- Earns rewards
- Customizable card design
➖ Cons:
- Annual fee
- Low starting credit limit
| Fees & Features | |
|---|---|
| Credit Line | Starting at $300 |
| Annual Fee | $75 first year, $99 after* |
| APR | 28.99% |
| Balance Transfer Fee | Not allowed |
| Late Payment Fee | $39 |
| Rewards | Flat 1% with up to 10% at select merchants |
* The annual fee starting the second year is billed monthly at $8.25/month
Using This Card to Improve Your Credit
Before applying for the Platinum card, you can use Credit One’s prequalification tool to avoid an unnecessary hard inquiry.
Once you have the card, you can use Credit One’s credit monitoring tools to track your score progress. Credit One also performs periodic credit reviews and may extend you a credit limit increase.
While this card has attractive features, such as decent cashback rewards, the low credit limit and the annual fee make this card a poor long-term choice. Once you qualify for better cards, you should close this one.
3. Milestone Gold Card
🏆 Best Low APR Option
The Milestone Gold Card is an unsecured card with a reasonable APR. At 24.9%, this is far lower than other credit cards in the bad credit category. And while there is an annual fee, it could be as low as $35.
Although it is one of the best second-chance credit cards with no security deposit, this low-APR card comes with one significant drawback: the $300 credit limit. Remember that a low credit limit makes it hard to keep your credit utilization low, which can make it harder to improve your credit score.
Milestone offers other versions of the Gold Card, some with higher credit limits or cashback opportunities but often with higher APRs and hefty annual fees.
➕ Pros:
- Decent APR
- Low 1% foreign transaction fee
➖ Cons:
- Annual fee
- Low credit line
- Over-limit fee
| Fees & Features | |
|---|---|
| Credit Line | $300 |
| Annual Fee | $35, $59, or $99* |
| APR | 24.9% |
| Balance Transfer Fee | Not allowed |
| Late Payment Fee | $40 |
| Rewards | None |
| Other Fees | $40 over-limit fee |
* A $99 annual fee is charged as $75 for the first year
It is worth noting that Milestone offers several variations of their Gold card, all with different terms. For instance, the Milestone Gold Card with a $700 limit comes with a $179 annual fee, 35.9% APR, and a monthly fee starting the second year.
Using This Card to Improve Your Credit
Milestone offers a prequalification tool for this Gold Card. Other versions may or may not offer a soft pull preapproval.
Once you open the card, the annual fee immediately hits. This could leave you with as high as 25% credit utilization in your first month without making any purchases.
Because it has a low credit limit with no opportunity to increase it and an over-limit charge, this card is best kept in your sock drawer and not used. You should close this card once you’ve used it to build your credit enough to qualify for better cards.
4. Petal 1 Rise
🏆 Best for Cashback Rewards
Petal offers three credit card programs, with Petal 1 Rise being the solution for those whose credit or Cash Score would not qualify them for Petal 1 or Petal 2.
The Petal 1 Rise card has a decent credit limit and a good rewards program. Shopping with select merchants can earn from 2% up to 10% cashback.
When you open the card, you’ll also get access to Petal’s unique features, like the Leap program for increasing your credit limit, credit monitoring, no foreign transaction fees, fraud protection, and more, making it one of the best second-chance credit cards with no security deposit out there.
➕ Pros:
- Good credit limits
- Earn cashback rewards
- No foreign transaction fees
➖ Cons:
- High APR
- Monthly fee
| Fees & Features | |
|---|---|
| Credit Line | $500 – $3,000 |
| Annual Fee | $59 |
| APR | 28.24% – 35.49% |
| Balance Transfer Fee | Not allowed |
| Late Payment Fee | $29 first, $40 subsequent |
| Rewards | 2% cashback up to 10% at select merchants |
| Other Fees | $8 monthly fee |
Petal offers two other no credit/bad credit cards with fewer fees and better terms that you may also qualify for.
Using This Card to Improve Your Credit
Petal offers a preapproval process where they use a soft pull of your credit and banking information to determine if you qualify for one of their cards.
Once you open the card, you are enrolled in the Leap program. Completing a Leap challenge involves 6 months of on-time payments and hitting your Leap credit score goal. The result is a credit limit increase of at least $50.
To help you track your credit progress, you’ll get access to credit monitoring featuring your VantageScore.
The one downside to Petal 1 is that you cannot upgrade to Petal 2. So, if you want to avoid the $59 annual fee and $96 a year in monthly fees, you’ll need to close the card once you qualify for a better product.
5. Surge
🏆 Best for Improving Your Credit
The second-chance card offered by Surge gives you the opportunity to improve your credit score.
Among the best second-chance credit cards with no security deposit, Surge stands out with a commendable initial credit limit of up to $1,000. It sweetens the deal by promising to double your credit limit after a mere 6 months of on-time payments, offering a decent boost to your credit utilization rate. Additionally, Surge provides you with an updated credit score monthly to track your progress.
➕ Pros:
- Double your credit limit at 6 months
- Free Experian VantageScore
➖ Cons:
- High annual fee
- Monthly fee after first year
- Low starting credit limit
| Fees & Features | |
|---|---|
| Credit Line | $300 – $1000 initial limit |
| Annual Fee | $99 or $125* |
| APR | 29.99% |
| Balance Transfer Fee | Not allowed |
| Late Payment Fee | $41 |
| Rewards | None |
| Other Fees | Monthly fee up to $10/month starting your second year |
* The annual fee is $75 for your first year
Using This Card to Improve Your Credit
Through the application link, Surge offers a prequalification check that lets you check your eligibility without a hard pull.
Once approved, you will be extended a credit limit between $300 and $1000. After 6 months of on-time payments, your credit limit will double. To help you track your progress, Surge gives you access to your credit score, which is updated once a month.
With the high annual fee and monthly fees starting your second year (up to $200+/year), this card is best when canceled before the end of your first year.
Comparing the 5 Best Second-Chance Credit Cards With No Security Deposit
All of the unsecured cards on our list offer a range of features and fees. Below is a quick comparison of the key fees and benefits.
| Annual Fee | APR | Monthly Fee | Rewards | |
|---|---|---|---|---|
| Capital One Platinum | $0 | 30.49% | No | No |
| Credit One Platinum | $99 | 28.99% | No* | Yes |
| Milestone Gold Card | Up to $99 | 24.9% | No | No |
| Petal 1 Rise | $59 | Up to 35.49% | Yes | Yes |
| Surge | Up to $125 | 29.99% | Yes | No |
* An annual fee is charged monthly after the first year
Secured Credit Cards and Other Options
The go-to solution when you have bad credit and want to open a new credit card is usually a secured credit card. Secured cards require a hefty deposit, which can be difficult to swing, especially if you are working on paying down existing debt.
However, there are some key benefits to secured cards. With a secured card, you can often avoid an annual fee, although this varies from bank to bank. Also, many secured cards offer a path to upgrade, where you can move to an unsecured card after X amount of time.
Secured cards are just one alternative; here are a few more
- A credit builder card (usually tied to a credit builder loan)
- Credit cards with no credit check
- Student cards
- Debit cards that report like credit cards
The most important thing to consider when choosing a credit card when you have bad credit is to look for a card that helps you build credit. If the card doesn’t report to all 3 credit bureaus, it won’t help you escape your bad credit situation.
Upgrade When You Are Able
When searching for the best second-chance credit cards with no security deposit, it’s essential to consider whether you’re opting for a secured or unsecured card. Regardless of your choice, don’t hold onto a second-chance card for an extended period. A year or two max is recommended. This is because these cards often have high fees, low credit limits, and few benefits.
Once you’ve used the card to qualify for a better card, one that fully fits your needs, you should seriously consider closing your second-chance credit card.
