Best Unsecured Credit Cards — January 2021

There are two types of credit cards: secured and unsecured. Unsecured cards are more prevalent and don’t have an opening deposit requirement. On the other hand, secured cards require that borrowers pay a deposit as collateral if they default on their payments.

Credit cards for fair credit are typically secured, but several unsecured cards can help you build or boost your credit.

Unsecured cards can be hit-or-miss if you have average credit because they usually lack favorable terms and have higher interest rates. While unsecured credit cards can be beneficial for your credit, it would help to know how they work and compare options to find the right one for you.

Discover it Student Cash Back

Annual fee: $0

Credit score requirements: None

Intro APR: 0% for six months

Regular APR: 12.99% – 21.99% (variable)

Penalty APR: None

Intro balance transfer APR: 10.99% for six months

Intro balance transfer fee: 3% for six months

Balance transfer fee: Up to 5% per transfer

Cash advance fee: $10 or 5% per transaction, whichever is greater.

Foreign transaction fee: $0

 

Discover offers a great welcome offer for new cardholders, which is one reason why it’s one of the best unsecured cards. After your first year, Discover will automatically match your cumulative cashback rewards. 

In other words, if you collected $50 in cashback, you could turn that into $100 — or $100 into $200. Discover has no minimum spending requirements or rewards limits so that you can get the most out of this offer.

You can earn 5% cashback on rotating spending categories, such as Amazon, the supermarket, dining, gas stations, and PayPal payments (activation required). When you reach the quarterly limit, you can enjoy unlimited 1% cashback on everything else (no activation required).

The reason why this card is great for students (besides the cashback rewards) is Discover’s Good Grades Rewards. This program offers $20 in statement credit every academic year you maintain a 3.0 GPA or higher (up to five years).

Discover reports to the three major consumer credit bureaus so that you can establish your credit in preparation for life after graduation. As you build your credit, you can monitor it with a complimentary Credit Scorecard that features your FICO score and other information you can use to identify areas of improvement.

Discover it Student Cash Back has no annual fee, no penalties on your first late payment, and no penalty APR. If you refer a friend and they sign up, you can receive a $50 statement credit every time. 

Discover Freeze It also lets you quickly lock and unlock your account to stop unauthorized purchases, balance transfers, and cash advances. And if Discover finds your personal information on the dark web, it will notify you immediately. 

 

Capital One QuicksilverOne Cash Rewards Credit Card

Annual fee: $39

Credit score requirement: Fair to Good (580 – 740)

Regular APR: 26.99% (variable)

Penalty APR: None

Balance transfer fee: $0

Cash advance fee: 3% of the amount of the transaction, minimum $10

Foreign transaction fee: $0

 

With the Capital One QuicksilverOne Cash Rewards card, you can enjoy unlimited 1.5% cashback on the things you buy every day, without activation or rotating categories. Cashback never expires as long as you keep your account open.

After six months of responsible use, Capital One will automatically review your account to consider you for a credit limit increase. It reports to the three credit agencies so you can build your credit faster.

Capital One also offers a free app called CreditWise, which lets you stay on top of your credit profile easily and conveniently. You get peace of mind in your card is lost or stolen thanks to $0 fraud liability, too. You can also sign up for personalized notifications and track your account through the Capital One mobile app.

 

Journey Student Rewards From Capital One

Annual fee: $0

Credit score requirement: Fair to Good (580 – 740)

Regular APR: 26.99% (variable)

Penalty APR: None

Balance transfer fee: $0

Cash advance fee:  3% of the amount of the transaction, minimum $10

Foreign transaction fee: $0

 

If you like the idea of earning 1% cashback on every purchase, then the Journey Student Rewards credit card from Capital One is for you. Plus, when you pay your monthly bill on time, you can enjoy an extra 0.25% cashback for that month’s purchases. The other benefit of paying your bill on time? An additional $5 each month for eligible streaming services. 

With zero annual fee or foreign transaction penalties, you can hold on to more of your rewards. Since Captial One reports to Experian, TransUnion, and Equifax, you can improve your credit with responsible use. After six months, it will automatically review your account for a potential credit limit increase.

Capital One offers cardholders flexibility by letting you choose the due date that fits your schedule best. You can also enjoy consumer protections like $0 fraud liability and monitor your credit with the free-to-use CreditWise app.

 

Source
  • US News Staff. “Best Unsecured Credit Cards.” U.S. News & World Report, U.S. News & World Report, 8 Jan. 2021, creditcards.usnews.com/unsecured.
Ian Schindler