Credit Cards For 500 Credit Score? Here’s How You Can Do It

Posted by CreditCardGuru

500Pop Quiz:What do 1 out of 15 people have?

Answer: A credit score below 500. And perhaps an STD.

FICO scores run on a 300 to 850 scale and reportedly only 6.3% of the US population has a 300-499 score. So I hate to be the bearer of bad news, but if you have a 500 credit score you are about as low as you can go.

The silver lining? You can improve and it’s possible to start building your credit now.

1. You won’t qualify for any traditional credit cards

With this low of a score, you are unlikely to qualify for any regular, non-secured credit card. You probably won’t even be able to get a plain vanilla Walmart store card with that low of a score.

So my first piece of advice is to try out this tool right now and find out in 60 seconds if you are matched for any credit card offers. IF you are matched for an offer, then go for it!

Use this tool since it matches you with offers. Don’t screw up your credit even more by randomly applying for cards from other places and hoping something sticks. Why? Because doing so might drop your score even further (or at least put inquiries on your credit report, which can make you look even riskier to lenders, if that’s possible). Having too many can negatively impact your score, wiping out any gains you might experience from good behavior. So the lesson is to only apply for a card for which you have a good chance of qualifying.

2. Avoid other cards that sock you with excessive fees

scary interest ratesThere are a small handful of unsecured cards out there that will probably approve a credit score of 500. When you see the fees they charge, you will understand why.

Example: First Premier Bank MasterCard

With this lovely offer you will pay a $95 processing fee and $75 annual fee. And what do you get in return? A measly $300 credit limit. Oh yeah and a 36% interest rate to go along with it.

Does your credit really stink? 500 is pretty foul, but that doesn’t mean you deserve to get taken for a ride. Don’t fall prey to these fee-harvester sub-prime credit cards from issuers like First Premier. They make tons of money on the backs of working folks who have few other options.

3. Secured cards are your best (and probably only) choice

So with the exception of First Premier Bank, the only credit cards for a 500 credit score are going to be secured.

What does this entail? A security deposit. In exchange for ponying up a deposit, you will be able to get a card. But don’t worry, the deposit will be refundable whenever you choose to cancel your card plus many banks that issue these cards will even pay you interest on the funds, so it’s just as good as putting the money in a traditional bank savings account.

Here is my favorite credit card to rebuild credit. Its fees are very reasonable (and I think you will agree with me too).

Now as far as getting a mortgage or auto loan with a 500 credit score…that’s probably a pipe dream. Just get a secured credit card and build some solid credit over time. Then you can enjoy fair credit terms for all types of loans.

This post was written or last updated August 4, 2014


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Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

20 comments... read them below or add your own

  1. kris October 28, 2014 at 8:06AM

    Credit Score 576 – 3 medical collections on report and a charge off with capital one within last six months.

    Credit One – Approved with 300 dollar limit. 75 dollar annual fee. Automatic credit line increases for on time payments.

    Kay Jewelers – Approved 1500 dollar limit. Extremely easy online approval. Showed up reporting on credit karma within a week of application. Reports 1500 limit with 0 dollars being used. Can use the card at any Kay jewelers stores, at kayjewelers.com, or at any affiliated stores. Approval is easy because your line of credit is given to you by sterling silver inc, versus banks that like to beat up on us with low credit stores due to baddies. Hope this helps.

  2. shane August 19, 2014 at 5:13AM

    My rating is 567 and have candain tire master for 1,500 .and want to make my credit better .do u think I can get a walmart master card for 500?.

  3. pete May 24, 2014 at 7:55PM

    My credit score is 490 I am not eligible do get ANY credit cards becouse of old collections. 8 of them exactly for a total of … 1000 $ There us no way for ne to be approved by any credit card company I tried everything and im in some kind of gimbo Dont know what to do

    • Tesha May 26, 2014 at 11:36PM

      Have you ever applied for credit with fingerhut? It’s one way you could improve your credit score… they report to the credit bureau. I applied today and was approved for a $230 line of credit with a credit score of 512.

    • david August 20, 2014 at 10:23AM

      Apply for credit one its only 300 limit but all fees are charged to card no money out of pocket until your first payment

  4. Angelica March 24, 2014 at 9:10AM

    Does anyone know of unsecured credit cards that will approve someone with a credit score of 570 I’m trying to rebuild my credit! Help

    • Tesha May 26, 2014 at 11:37PM

      Maybe a Walmart card, that’s probably all.

    • sheena June 30, 2014 at 3:24PM

      first premier with A 300 LIMIT

  5. Tara August 28, 2013 at 6:57AM

    I got a car loan for a 2013 brand new Ford Fiesta the interest is slightly higher but I am refinancing with my credit union in 6 months. My credit union said after 6 months of steady on time payments my 520 crdit score will be up high enough to refinance through them with a much lower interest rate.

  6. Kaycee June 13, 2013 at 7:58AM

    I have a credit score of 464 and was approved for a car loan thru Santander auto loans. I was shocked but it happened.

    • Julex September 11, 2013 at 4:50PM

      But your interest rate was through the roof I’m sure…

    • John Santoya April 23, 2014 at 5:09AM

      Did you have to pay an outrageous down payment if you don’t mind me asking cause I’m trying to finance a car and my credit score is also pretty low

    • Jade October 10, 2014 at 6:30AM

      You have no idea how bad santander is I also got a loan on a car from them 2 years ago for 19000 I now owe 24000 on the car never had 1 late payment with them they apply every cent to intrest Google them they have a load of lawsuits against them

    • CRYSTAL October 21, 2014 at 5:33AM

      I was shocked as well but I also was approved thru santander for a car! they have been very friendly when ive called….very nice customer service

  7. Christina May 1, 2013 at 3:36PM

    I currently am in the 500′s credit score range. No less than 537 with experian. I am leasing a 2012 Honda Accord. Basically before I got the car my mom used my social security number for numerous of retail card applications as well as cable services and would not pay the bills on time until about 3-4 months later after they cut our services and would just stack up payment. I PERSONALLY pay my statement for my Honda 6 days before the due date every month. I now have lifelock as well to get alerts of any thing that goes under my social. I am 21 years old and I have two jobs as well as i am going to school. I have until 2015 when my lease with this car ends.

    My question is, should I wait those next 2 and a half years to see how my credit score goes up with these lease to apply for a credit card or should I apply for a credit card as you say, a secured card, to help improve my credit score as well? My goal is to reach a high credit score by the time I am 35 so that I may buy a house. All my life I have moved around and I want my future family to be secure. Is there any tips you can give me as you answer my question? Thank you!

    • Allen May 22, 2013 at 8:01PM

      Hello Christina,

      Depending on the type of your credit history, normally it would be kept for 3 or 6 years. So don’t be too worried. See more information here:

      http://www.fcac-acfc.gc.ca/eng/resources/publications/budgetmoneymgmt/creditreportscore/ReportScore-3b-eng.asp

      If you don’t have any credit cards, I suggest you to apply one from CapitalOne now. They have a guaranteed approval Master Card. It may help you to build credits. You may get a limit for only $500 at the beginning, but try calling them to increase the limit to $1,500 after 6 months or a year.

      Please keep in mind to make payment payment on time, if you can’t pay it in full, pay at least the minimum payment.

      Besides paying on time, here are some useful tips:

      if your credit balance on your statment reaches…
      0 – 25% of your credit limit – your credit score will go up
      25% – 50% of your credit limit – your credit score will go up a little
      50% – 75% of your credit limit – your credit score will not go up
      75% – 100% of your credit limit – you’re on the red line
      over 100% of your credit limit – you’re damaging your credit

      Try to apply for another credit card later, because one credit card account and one auto lease account would not be well enough to show on your credit report.

      There’s NO fast track to build credits, beware of the scam websites on the internet. First, make sure all credit accounts are up to date and no collections is against you.

      I can tell you that your credit score will climb back to 650 or up after 2 years because I had the same experience 6 or 7 years ago and I now own a house with a mortgage with only 2.15% interest rate.

      One more important fact, your credit score not only affect you being approved for credits applications, it also affect the interest rate as well.

      For example, if you have a 800 credit score, you may enjoy a much lower interest than the ones who has only 650 buying the exact same product even though you both got approved.

      Keep track on all yourself. You’ll be fine.

      • Allen May 22, 2013 at 8:07PM

        About credit balance, I didn’t mean you should only use 25% of your $500 limit.
        I meant that if you used $500, then pay at least $400 before the statement date not the due date because they report to the credit bureau following the statement date.

        And you have to use the credit card, don’t let it sit idle.

      • Allen May 22, 2013 at 8:07PM

        Regarding the balance, I didn’t mean you should only use 25% of your $500 limit. I meant that if you used $500, then pay at least $400 before the statement date not the due date because they report to the credit bureau following the statement date. And you have to use the credit card, don’t let it sit idle.

    • brian May 25, 2013 at 8:16AM

      how did you secure a lease with a 537 credit score?

  8. Milando March 19, 2013 at 11:12AM

    Thanks for the tips, I’ll give this a shot. I’m trying to get my credit score back up.

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