Today, getting a credit card without a credit check is easier. This helps people with bad credit or no credit at all. About 25% of people with low FICO scores are looking for these cards. Yet, many such cards have high costs over time.
New companies are changing the game with low-fee or fee-free cards. They use new tech to check creditworthiness differently. Now, this tech looks at how you manage your bank account. So, there are more and better options for people without a credit history.
Take the Chime Secured Credit Builder Visa® Credit Card, for example. It’s helped over 40% of its users improve their credit scores. Users saw an average 30-point increase from June to October 2022. The Current Build Card also offers great perks, like up to 7x rewards at certain stores. These options make it easier for folks to get financial freedom.
Key Takeaways
- Approximately 25% of individuals with poor credit are interested in credit cards without a credit check.
- Traditionally, many no credit check credit cards come with high fees and interest rates.
- About 20% of newer startups offer no credit check cards with no or low fees, leveraging proprietary underwriting technology.
- Examples like the Chime Secured Credit Builder Visa® Credit Card have proven to be beneficial for over 40% of Chime users.
- Credit card options such as the Current Build Card offer up to 7x rewards at selected merchants, enhancing financial flexibility.
Understanding Credit Cards That Don’t Require a Credit Check
More and more, we see credit cards that don’t need a credit check. They help people with bad credit avoid the damage of a hard credit check. Financial tech companies now look at things like how steady your income is and your banking habits. They don’t just rely on FICO scores anymore.
Why Some Credit Cards Skip the Credit Check
Some banks have realized that credit scores don’t always tell the whole story about someone’s money habits. That’s why no credit check credit cards are becoming popular. They offer a chance for people who haven’t had much credit before. Or for those with poor credit, to get a credit card without a hard check. This can save their score from going down.
The Potential Downsides of No Credit Check Credit Cards
No credit check credit cards seem great since they don’t need a traditional credit check. But they often come with high fees and tough terms. Over time, this can cost a lot. In 2021, ProPublica talked about Chime customers facing sudden account closures. So, it’s really important to read and understand the terms well before you dive in.
Proprietary Underwriting Technology
There’s new tech in finance that looks at different kinds of data to decide on credit. Companies like Chime and their Chime Secured Credit Builder Visa are leading this change. They consider how you handle your bank account and your income. This opens up credit access to more people without using old credit scores. The success of these new credit options depends a lot on how accurate and fair these new checking systems are.
Exploring Alternative Credit Card Options
Today, the credit card market offers low- and no-fee choices that skip the credit check. These options are great for those wanting to build credit minus the downsides of traditional cards. They let you find credit card options without needing a credit check.
Examples of Credit Cards with No Credit Check
Let’s check out some well-liked cards that match different needs:
What type of Credit Card do you want?
- Varo Believe Secured Credit Card: Great for people starting without credit history, offering user-friendly features.
- Discover it Secured: This card is reported to the three major credit bureaus and offers a pathway to an unsecured card.
- Current Build Card: Targets younger and lower-income groups, who often don’t have credit scores.
Choosing the right card, like the OpenSky® Secured Visa® or the Chime Visa® Credit Builder Card, helps build or start your credit score. These cards provide ways to get credit benefits without needing a credit check. From the chance to earn rewards to different payment options, these cards make it easier to get a credit card without a credit check.
How to Get a Credit Card Without a Credit Check
Getting a credit card without a credit check can be simple if you know where to begin. Start by finding a card that fits your financial needs. Look for reputable issuers like Chime or Discover that offer cards without needing a credit check or that are secured. You’ll need to provide personal details and sometimes set up direct deposits to prove steady income when you open an account.
Steps to Applying for a No Credit Check Credit Card
Applying for a no credit check credit card requires some basic information. You’ll need to give your name, Social Security number or ITIN, address, annual income, job status, housing costs, and phone number. The application is usually done online and takes just minutes. Once you have an account, you may qualify for cards like Discover’s secured options. These offer benefits like cash back rewards and no late fees.
Building Credit with Secured Credit Cards
Secured credit cards are great for building or rebuilding credit. Cards like the Discover it® Secured credit card need a deposit which reduces the issuer’s risk. By making payments on time, you improve your credit score. Discover allows you to move to a regular card after six months of timely payments and good credit status.
