Having a bad credit score in Canada does not automatically rule you out of getting a credit card. Although it’s always advisable to be a responsible card user, ensure to make timely payment of your balance monthly and keep your credit utilization beneath 30% monthly.
Be reassured that you can restore your credit card, as borrowers with bad credit score, insolvency or bad financial behavior can obtain a number of secured or unsecured credit cards for a bad credit card in Canada to help them build, re-build or repair their credit histories and credit scores. Regardless of the kind of card you are looking to obtain – unsecured, secured, or guaranteed approval credit card, there is always an option for you.
With the above-mentioned credit cards, you can enjoy all the perks of having a credit card, regardless of if you have a credit history or not, or if you have a bad credit score. These credit cards for bad credit will help you build or rebuild a strong credit score. Also, you can make online purchases, and make travel reservations with these cards. All amounts indicated in this article are in Canadian dollars.
Secured Credit Card with Bad Credit Score
This is a credit card option for people with a bad credit score in Canada. This credit card is supported by a security deposit you make to your bank or other financial institution that offers the card. It is like a reassurance deposit to the lender, in case you fail to pay your credit card balance. The lender can claim your security repost to sort out the balance. A secured credit card is not difficult to get even if you have a bad credit score or you’re without a steady income.
The deposit you’re required to make for this card depends on your credit limit. The limit ranges from $200, $500 to $5000. Most issuers promote low annual fees ranging from $10 – $30. Note that the deposit is refundable if you offset your balance and keep your account in good standing. Your deposit will be refunded back t you once you close down the account. Making the timely payment is a sure way to repair your credit score as secured credit cards report to credit bureaus like Equifax and TransUnion.
Secured credit cards work like any conventional credit card. You’ll be responsible for making the least payment on your credit card charges monthly. If you fail to make a payment, you’ll be charged interest on the outstanding balance. Depending on the secured credit card you choose, you may be required to pay an additional setup fee and/or an annual fee.
Note that you cannot utilize your security deposit to offset your credit card bill. Also, a secured credit card sometimes charges higher interest rates, and there are no extra perks like travel reward points or extended warranties.
No Annual Fee Secured Credit Card with Bad Credit Score
-
Home Trust Secured No Fee Visa
This credit card can be utilized like every other credit card, its requirement does not include a credit check, and most applicants are approved instantly. Home Trust reports your payments to both Equifax and TransUnion, which help you to rebuild your credit score. Click here to apply.
Requirement
- Poor/bad credit score
- No minimum fee required
- No annual fee required
Card Features
- A basic interest rate of 19.99%
- $500 – $1000credit limit
- 0% charge on foreign transactions.
- $2.50 minimum fee on cash advances
This card comes with a basic 21-day window period on all new purchases before you start getting interest charges. If you offset your balance when due, you might not be charged higher interest. Note that Home Trust does not allow users to go over their credit limit; you’ll be subjected to a $29 fee every time you cross your credit limit.
Unsecured Credit Card with Bad Credit Score
This card does not require cash or assets as collateral, the card issuer rust you based on your creditworthiness. Because no collateral is involved, the application requirement is a bit strict. There are several types of unsecured credit cards in the Canadian market; some even offer lower interest rates. It is important to always make timely payment; failure to do so will dent your credit score, and increase your interest rates. Subsequently, if you do not maintain good standing, you may not be approved for any unsecured cards in the future.
Type of Unsecured Credit Card for Bad Credit Score
- Capital One Low Rate Guaranteed MasterCard
This card is suitable for people with bad credit scores in Canada. This card provides its holder with guaranteed approval and a low-interest rate. This card is like a saving grace for applicants from high-interest rates. To apply for this card click here.
Requirement
- Poor/bad credit score
- No minimum personal income required
- $79 annual fees apply (APR 14.9%, CAR 19.8%)
Card Features
- Guaranteed approval
- 14.9% interest rate on purchases and balance transfers
- 19.8% interest rate on cash advances
- $79 annual fees
- Price protection
With this card, you can ask for a refund from a retailer if there is a price difference up to $100 per item and $500 per year with 60 days of item purchase. This card also has travel benefits like carrier travel accident insurance, and coverage for baggage and rental vehicles.
Low-Interest Credit Cards with Bad Credit Score
These cards are provided by major unions, financial institutions, and online lending services. The perks of these card to users is the low-interest charges. Some card issuers offer a low-interest card to lenders with bad credit and offer benefits like cashback, gas rewards, payment alerts, etc.
Type of Low-Interest Secured Credit Card for Bad Credit
- Refresh Financial Secured Visa
This card is a rare credit card in Canada that guarantees approval on every application, as long as the applicant makes the minimum required deposit. No credit card check is required for this card, hence making it an option for people with bad credit score cards in Canada. Click here to apply
Requirement
- Poor/bad credit score
- No minimum income required
- $48.95 annual fees
Credit Card Features
- 17.99% interest rate
- $3 monthly fees plus a $12.95 fee, while $48.95 annually
- $200 – $1000 minimum deposit
This card has a 21-day interest-free window period on all new purchases. Aside from its low annual fee, this card offers $0.10 if your transaction is declined and $0.50 to offset the bill. You’ll be charged $5 the first time you go over your credit limit, for the second time your card will be canceled. Also, you’ll be charged $5 for every ATM cash advance in Canada. Note that, you’ll be charged $2 monthly if you don’t utilize your card.
Low-Interest Unsecured Credit Card with Bad Credit Score
- RBC Visa Classic Low Rate Card
The most outstanding perk of this card is the low credit offer. This card offers cardholders only 12.99% on both purchases and cash advances. Its annual fee is extremely low.
Requirement
- Permanent resident of Canada
- Fair/good credit score
- No minimum income required
- $20 annual fees
Card Features
- 12.99% purchase interest rate
- 12.99% cash advance
- Additional cards at no fee
RBC evaluates an applicant’s credit history, savings, and debt income before approval. Also, this card includes purchase protection and zero fraud liability alongside 3 cents discounts per liter of fuel and 20% extra Petro-Points bonus when you utilize your card at Petro-Canada.
Guaranteed Credit Cards
Guaranteed approval cards are issued by MasterCard and Visa, they offer credit cards to lenders with bad credit scorecards. These cards are available for people who need to build and improve their credit scores. Some of the features of this card include;
- Travel assistance
- Price protection
- Baggage delay coverage, etc.
Generally, issuers of these cards offer less strict requirements for approval.
Guaranteed Approval Secured Credit Card with Bad Credit Score
- Capital One Guaranteed Secured MasterCard
With bad credit score cards, Canadians are at the discretion of the banks to approve their application or not. Most banks go through application less strictly if they are for a secured card, approval is still uncertain though. This credit card offers holders low-barrier access to credit in Canada. Click here to apply.
Requirement
- Poor/Bad credit score
- No minimum personal income required
- $59 annual fees (APR 19.8% CAR 19.8%)
- $75-$300 security fund
- Age 18 and above
- No existing Capital One accounts
- No pending applications for a Capital One product
- No application for a Capital One product more than once in 30 days
This card has other perks aside building your credit score. It is accepted everywhere and comes with universal support provided by MasterCard Global Service. You can share your card and account with an authorized user for free. The card has a built-in liability protect against scam.
Prepared Credit Cards with Bad Credit Score
This card allows people with bad credit score cards in Canada to make purchases and payments; sadly it is not the best for rebuilding your credit score. This is because payments are usually not reported to any of the credit bureaus. Yet, it is one of the options for people with bad credit. There are different ways to make a payment if you’re a holder of this card, you can make a direct deposit, go in-person or pay online. This card also has an option for bill payment, balance alerts, free ATM withdrawals, business and payroll programs, refer-a-friend bonuses, etc.
Store Credit Cards with Bad Credit Score
A store credit card is another option for people with bad credit score cards in Canada looking to obtain a credit card. This card offers several benefits to holders like promos and discounts, sales, coupons, savings on one-time purchases or major purchases and no introductory fee for a certain period. Note that store cards usually charge high-interest rates than secured and standard credit cards.
