Having bad credit has its limitations. You may find yourself having to invest more time and research into finding the tools and financial services available to you when trying to rebuild you credit.
In addition, many of the options offered to you when you have bad credit tend to have high interest rates, and late penalty fees. However, if you get past the stage of high interest by proving your creditworthiness and making on-time payments your credit will be better long term. There are resources you can use to help you build your credit and also benefit your wallet. Cash back credit cards can be a way for you to use your credit card responsibly while getting a reward for using it.
With cash back credit cards you earn cash back or "rewards" with different types of purchases. Generally, the more you use your card on these purchases the better and higher amounts of cash back you get. But it is important to note that when you are rebuilding your credit you do not want to overuse your credit card and max it out quickly. Use it responsibly on purchases you know you can pay back in full at the end of the billing cycle.
Discover It Secured Credit Card
The Discover It Secured Credit Card allows you to build credit while learning how to use your card responsibly. It offers two percent cash back on all purchases at restaurants and gas stations. In addition, you get one percent cash back on additional purchases. This card will provide you with many opportunities to get cash back because you are getting cash back on all purchases regardless. There is no annual fee and they give you your FICO score on your bill each month that allows you to keep track of your score. To start your credit line you pay a refundable security deposit starting at $200.
- Reports to the three major credit bureaus
- Teaches you responsible credit card use
- Easy approval
- Cashback on every purchase
Credit One Bank Platinum Visa
This card is advertised for those with poor credit and it is easy to qualify for because of that. The APR is variable starting at a lower rate for those with bad credit at 16.99 percent. You get one percent cash back on some purchases. In addition, you can monitor your account online with fraud alerts. To help you pay your bill on time they also offer email or text alerts close to your payment due date.
- Designed for poor credit
- Cashback rewards
- Variable APR
Credit One Unsecured Visa
This is an unsecured credit card that allows you the flexibility to choose your payment date. You can also receive opportunities to increase your credit line with responsible use. There are cash back rewards offered on some purchases at one percent per purchase. You do not have to have a hard check performed on your credit score to see if you prequalify. The interest rate is variable and it starts at 16.99 percent.
- Variable APR
- Cashback Rewards
- No annual fee
- Flexible payment date
The Credit One Visa options also give you cash back and have similar features both of these cards can help you rebuild your credit while also earning cash back. But, unlike the Discover It card, which gives you cash back on all purchases, there are some restrictions on the cash back rewards of these cards.
Which One Should You Choose?
Each of these cards is similar but slightly differ in some of the aspects they offer. The Discover It card is a secured credit card, which means you start your credit limit and essentially are investing your own money instead of borrowing from the bank. Secured credit cards tend to help you repair your credit because the credit limits often start as small amounts that limit your use of the credit card because your credit line is not that large.
As a result of this, they encourage you to make smaller purchases, which are easier to pay off. For example, the Discover It gives you the most cash back on food and gas purchases, which tend to be smaller amounts. Remember that rewards encourage cardholders to spend money and since you are rebuilding your credit you want to make sure you are using you card only on things you know you can pay back at the end of the billing cycle. The good thing about these cards is even while you are building your credit you are still earning rewards on small purchases that you are likely to make.