Best Second Chance Credit Cards With No Security Deposit Of September 2024 (2024)

Forbes Advisor looked at dozens of offers to find and rank the best second chance credit cards. Factors considered include.

• Credit score requirements
• Reporting to credit bureaus
• Potential to increase credit limit over time
• Ability to upgrade to card with more features and rewards
• Rewards
• Fees

Forbes Advisor rates cards both as stand-alone products (the card rating on the review) and compared to others in a specific use case. Sometimes, cards with average stand-alone ratings may still rank highly on a particular list according to how a person looking for a card in that category may value certain card features.

For instance, a card that might be considered mediocre overall could be the top card on a list of rewards cards with no annual fee. That’s because the card might offer limited features compared to other rewards cards, but after we remove cards that charge an annual fee, it’s the best card that remains.

For second chance credit cards, we focused on identifying cards with lower or no fees to reduce the financial burden of carrying the card. We also had a preference for cards that offered an upgrade path, whether by increasing the credit limit or through product change.

Read more: How Forbes Advisor rates credit cards

Pros

• No security deposit. You don’t have to put down a security deposit to open an unsecured second chance credit card.
• Building credit. Second chance credit cards can help you rebuild your credit if you make on-time payments and use your card responsibly.

Cons

• High fees. Second chance credit cards often come with many fees, including annual fees, high APRs and late payment fees.
• Reduced credit limits. Credit limits offered by second chance credit cards are typically lower than other credit cards.
• Reduced or no rewards. Second chance credit cards often earn no or lower reward rates than other credit cards.
• Fewer options. Secured credit cards are lower risk for issuers and as a result, there are more options available compared to unsecured cards.

A second chance credit card typically offers terrible-for-the-user rates and fees to offset the issuers’ risk of lending to those with a poor history of credit management. This means users pay more for the privilege of a second chance credit card. Otherwise, these cards work much the same as other credit cards.

The credit limit for a second chance credit card is typically lower than a traditional card, but the credit limit can often be increased over time as the account holder demonstrates responsible credit use. Though second chance credit cards may not offer as many benefits as other cards, the best second chance credit cards report activity to all three credit bureaus. This helps cardholders rebuild credit with responsible use.

Where Can I Find a Second Chance Credit Card?

Your current bank may offer a second chance credit card. These types of credit cards typically aren’t as well-advertised as other credit products, so your local bank is a convenient and familiar place to start looking. You may also benefit from dealing with a bank that you already have a financial relationship with.

If your bank doesn’t offer a second chance credit card or you don’t already have a bank, you can find several credit cards by searching online.

You can also use a source like this one that offers transparency and methodology, meaning we’ve already done the research for you. Once you find a couple of products you like, carefully compare to choose the one for your unique needs and situation.

How Do I Get a Second Chance Credit Card With No Security Deposit?

Applying for a second chance credit card without a security deposit requirement may be as simple as filling out an application on the issuer’s website and clicking “submit,” but you might consider several other steps beforehand to improve your odds of approval. Because each credit inquiry made when you submit an application can negatively impact your credit score, it’s wise to ensure you have the best shot at approval whenever you apply for a card.

Some issuers offer preapproval or pre-qualification—processes by which you may submit some basic information and see whether the issuer deems you likely to be approved or not. Preapproval or pre-qualification doesn’t require a hard credit inquiry so it doesn’t affect your credit score. While preapproval or pre-qualification can help give you some idea of the likelihood of approval, neither offers a guarantee.

Even if you know your credit score is low, checking to ensure the damage isn’t as bad as it could be may be worthwhile. Pull your own credit report and verify there are no errors or derogatory marks that shouldn’t be there. Mistakes do happen, so be sure to dispute any errors. Doing so will help you improve your credit before you apply for a new card.

Report as much of your income as possible. Don’t lie—lying on a credit card application is a federal offense—but do try to provide as much proof as possible that you’ll be able to meet your monthly credit card obligations. This can help issuers have more confidence you’ll be responsible enough to pay off your balance each month.

Many credit card issuers will preapprove new applicants without running a hard credit check. This means someone can shop around for a few cards and apply for preapproval without worrying about inquiries on their credit report. Once a consumer decides which second chance credit card to apply for, they can ask the issuer to run the hard inquiry and issue a final decision. Hard inquiries help card issuers determine important terms for customers like credit limits and variable APRs.

Are Second Chance Credit Cards Worth It?

Yes, absolutely. Your credit is a valuable asset, and it’s worth your time to improve. When you’re ready to shop for a car, a home or other loan, good credit will almost always get you better terms and lower rates. Your credit score is also used for other purposes. For example, a landlord will screen prospective tenants using their credit scores.

Plus, when you’re ready, your improved credit can open the door to the best credit cards, including travel credit cards, that can quite literally set you on a new path. There’s really no downside to improving your credit score.

The options for unsecured second chance credit cards are limited, but we’ve identified three that are candidates for someone attempting to rebuild credit and doesn’t have the cash available for a secured card. To successfully rebuild your credit, be sure to make monthly payments on time and keep your credit utilization low—ideally under 30%. It may take time, especially if you have any serious negative marks on your credit report, but consistent, responsible use of your credit card will ultimately pay off in an improved credit profile.

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