credit card advice
Although the number of people with sub-500 FICO credit scores has dropped over the last decade, it’s still a fairly significant 4.7% of US consumers, or around 14 million adults.
And while having a credit score between 400 and 450 is above the minimum — FICO scores range from 300 to 850 — it’s still a very difficult situation to remedy.
That being said, it’s not impossible to qualify for credit with a 400 to 450 credit score, but you’ll need to accept that the rates and fees you’re offered will likely be quite high, the limits likely quite low, and the down payments practically mandatory.
Credit Cards: 400-450 Credit Score
Credit cards are often one of the easiest types of credit to obtain with a low credit score, mostly due to the fact that they often represent very small credit lines.
On the plus side, credit cards are what’s called revolving credit, which means you can reuse the credit line once you’ve repaid your balance (unlike a loan, which closes once it’s been repaid).
Secured credit cards — ones that require a refundable deposit — will be the easiest to obtain with poor credit, though closed-loop (only usable with one retailer) unsecured cards are available to a variety of credit scores.
1. Fingerhut Credit Account
While today a web-based retailer, Fingerhut started out as a mail-order catalog company selling a range of items for the home. The modern digital Fingerhut has thousands of products from hundreds of major retailers including Samsung, KitchenAid, and Dell.
After filling out your Fingerhut application, you may be considered for one of two credit products. The WebBank/Fingerhut Advantage Credit Account is an unsecured credit line that can only be used for Fingerhut purchases (similar to traditional store credit cards).
at Fingerhut'ssecure website
- Fingerhut offers more than 500,000 items including the brand names you want like Samsung, KitchenAid, and DeWalt
- Fast, easy online application process and a quick decision
- Take advantage of low monthly payments if you apply and are accepted for a Fingerhut Credit Account issued by WebBank, who determines eligibility and qualifications for the terms of credit
See Issuer Website
Your WebBank/Fingerhut Advantage Credit Account charges no annual fee and operates the same as a regular unsecured credit card, including offering a grace period to pay off your balance without accruing interest.
Those whose credit profiles restrict them from qualifying for a WebBank/Fingerhut Advantage Credit Account will be automatically reviewed for a WebBank/Fingerhut FreshStart Installment Loan.
FreshStart Loans allow you to build credit by financing a Fingerhut purchase of at least $50 by making a $30 down payment at the time of purchase. Then, you’ll make six to eight monthly payments to pay off the remaining balance.
2. Capital One® Secured Mastercard®
A secured credit card, the Capital One® Secured Mastercard® will require an initial deposit to open and maintain the account. On the plus side, your deposit is fully refundable (so long as you don’t default on the account).
Although the exact amount you will be required to deposit will depend on your credit profile, with a 400 to 450 score, you’ll likely be asked to make the maximum $200 down payment.
- No annual fee, and all the credit building benefits with responsible card use
- Unlike a prepaid card, it builds credit when used responsibly, with regular reporting to the 3 major credit bureaus
- You will get an initial $200 credit line after making a security deposit of $49, $99, or $200, determined based on your creditworthiness
- Get access to a higher credit line after making your first 5 monthly payments on time with no additional deposit needed
- Easily manage your account 24/7 with online access, by phone or using our mobile app
- It's a credit card accepted at millions of locations worldwide
All cardholders will start with a $200 credit line, but you can receive access to a higher credit line after making your first five monthly payments on time.
Additionally, new Capital One® Secured Mastercard® cardholders may have the opportunity to graduate to an unsecured Capital One® product by maintaining their account in good standing and showing credit score improvements over time.
Capital One® will periodically check your credit profile and account activity to see if you qualify for an upgrade to an unsecured product. If so, you will be upgraded automatically and your deposit will be refunded in full.
3. Brink’s Prepaid Mastercard®
Unlike other options on the list, the Brink’s Prepaid Mastercard® is not an actual credit card, as it is not tied to a credit line. This means you will not be required to undergo a credit check to open the account and your credit score will have no impact on your approval.
Instead of a credit line, the Brink’s card is a prepaid card, meaning you will need to load funds on the card to make purchases. Once loaded, the card can be used to make purchases anywhere Mastercard® is accepted.
at Netspend'ssecure website
- Brink's gives you the peace of mind you deserve. Securing cash and valuables since 1859.
- With Brink's Direct Deposit, you can get paid faster* than a paper check.
- No late fees or interest charges because this is not a credit card.
- Use the Brink's Money Prepaid Mobile App to manage your account on the go and get text message or email alerts (Message & data rates may apply.)
- Get your tax refund direct deposited to your Card Account and no more waiting in line to cash your check!
- *Card issued by BofI Federal Bank, Member FDIC. Card may be used everywhere Mastercard Debit cards are accepted. "Apply Now" for full details.
Variable Monthly Fees
No Credit Check
Funds can be added to the Brink’s Prepaid Mastercard® through a variety of methods, including a transfer from an existing bank account, through Direct Deposit, or with mobile check loading.
One thing to keep in mind with prepaid cards is that while your credit score won’t impact your approval, your prepaid card also won’t impact your credit score.
Essentially, because prepaid cards aren’t actual credit lines, they won’t report to the credit bureaus. So prepaid cards can be used to make purchases, but they can’t be used to establish or build your credit profile.
4. First Progress Platinum Prestige MasterCard® Secured Credit Card
The First Progress Platinum Prestige MasterCard® Secured Credit Card is another secured credit line, which means you’ll need to make an initial deposit to open your account. As with other secured cards, however, your deposit is fully refundable so long as your account remains in good standing.
The size of your credit line will be directly determined by the size of your deposit. The minimum deposit amount is $200, though qualifying applicants may be able to deposit up to $2,000 to secure a larger credit line.
at First Progress'ssecure website
- Fund your new MasterCard® secured credit card with your tax refund today!
- Our card reports monthly to all three major bureaus and approval is based upon a fully-refundable security deposit.
- We can approve you at any credit score, no minimum required.
- No processing or application fees required.
- Full-featured Platinum MasterCard, accepted for car rentals, hotels, and millions of other locations worldwide.
- Credit Line Secured by Your Fully-Refundable Deposit of $200 - $2,000 Submitted with Application
Bad / No Credit
The First Progress Platinum Prestige is fairly special in that it offers a particularly low APR for a card available to low credit scores, making it potentially a better choice for cardholders who tend to carry a balance on a regular basis. It also has no processing or application fees.
Personal Loans: 400-450 Credit Score
While some lenders will offer personal loans with collateral, most will stick to unsecured personal loans, which can be harder to get with a low credit score.
In general, personal loans will either be long-term installment loans, which can be repaid via regular payments over months or years, and short-term cash advance loans, which are repaid in a lump sum after a period of weeks.
While short-term loans will likely be easier to qualify for with a 400 to 450 credit score, they tend to be significantly more expensive — i.e., they have much higher rates and fees — than installment loans.
BadCreditLoans.com is an online lending network that connects borrowers with lenders who offer personal installment loans to a range of credit scores.
While the site’s partners can provide loans of up to $5,000, those with particularly low credit scores are unlikely to qualify for amounts over $1,000.
- Loan amounts range from $500 to $5,000
- Experienced provider established in 1998
- Compare quotes from a network of lenders
- Flexible credit requirements
- Easy online application & 5-minute approval
- Funding in as few as 24 hours
The maximum APR charged for a loan through BadCreditLoans.com is 35.99%, which can mean significant interest rate costs, though even a high-interest installment loan will typically be more cost-effective than a short-term cash advance or payday loan.
Always compare offers to ensure you get the right lender for you. This means looking at all of the loan’s terms — not just the monthly payment. The APR, time you’ll take to repay the loan, and size of the loan itself will all contribute to the total cost of your loan.
MoneyMutual.com is an online lending network that specializes in lenders who offer short-term loans, which are usually small loans of less than six months.
These loans are typically repaid at the end of the loan term in a single lump sum that includes both the principal amount and all applicable fees.
- Short-term loans up to $2,500
- Online marketplace of lenders
- Funds available in as few as 24 hours
- Simple online form takes less than 5 minutes
- Trusted by more than 2,000,000 customers
- Not available in NY
Most short-term loans charge finance fees, rather than typical interest rates, which are set amounts based on the size of your loan and the amount of time you need to repay it.
As a result, it can be difficult to compare the real cost of a short-term cash advance loan with other types of credit products that use APRs (annual interest rates) instead.
For example, a typical short-term loan may charge a $20 fee for every $100 borrowed. If you borrowed $500 at that rate for one month, you’re essentially being charged an APR of 243%. Compare this to the worst credit card you can find, and you’ll still be paying over 200% more for your short-term loan.
Auto Loan: 400-450 Credit Score
Most automobile loans are secured loans, meaning the vehicle itself acts as collateral for the loan. In other words, if you default on the loan (stop making payments), the lender can — and will — seize the vehicle and sell it to recover its losses.
The extra security provided by the collateral means you may successfully obtain an auto loan with a 400 to 450 credit score, but don’t expect to finance that six-digit car. Even that four-digit car will likely require a sizable down payment with a low credit score.
7. Auto Credit Express
Because the average bank will turn down a credit score below 600, many people turn to dealers to finance car purchases when they have low scores. Auto Credit Express is an online dealer network that helps people with poor or limited credit connect with dealers for financing.
With over 1,200 partners, Auto Credit Express can help a wide range of credit types, though you’ll need to meet the minimum income requirement of $1,500 a month. There’s no fee for using Auto Credit Express to connect with a dealer.
- Dealer partner network has closed over $1 billion in auto loans
- Can help those with bad credit, no credit, bankruptcy, and repossession
- Established in 1999
- Easy, 30-second pre-qualification form
- Bad-credit applicants must have $1500/month income to qualify
While Auto Credit Express can connect you with dealers and show you pre-approval offers, the network itself doesn’t have anything to do with your loan. Once you select a dealer partner, you’ll be invited to meet with a dealer representative to select a vehicle and complete the process.
And, after you obtain your vehicle and financing, you’ll make your payments to the dealer (or the third-party bank, depending on the nature of your financing), not Auto Credit Express.
Home Loan: 400-450 Credit Score
With a sub-600 credit score, your mortgage options are usually limited to FHA-backed loans. But while the FHA has no designated minimum credit score requirements, lenders are allowed to set their own requirements.
As such, the unfortunate fact is that most mortgage lenders simply will not lend to someone with a 400 to 450 credit score. However, exceptions are always out there, particularly if you have a large enough down payment.
Additionally, if you’re struggling with your current mortgage and have built equity in your home, you may have a chance at qualifying for a home refinance loan with some FHA lenders.
Although the pickings for a mortgage loan are slim at best with a sub-450 credit score, you may be able to improve your odds with an online lending network like LendingTree.
With a network containing hundreds of partners, LendingTree can scour the country to find potential offers. This can not only open more possibilities by removing geographical limitations, but it can also save you from an endless stream of individual applications.
- Find lenders for new home purchases, refinancing, home equity loans, and reverse mortgages
- Lenders compete for your business
- Offers in minutes
- Receive up to 5 loan offers and select the right one for you
- Founded in 1996
- Over $250 billion in closed loan transactions
Of course, even with a very sizable down payment, finding a mortgage loan with a credit score below 450 will be a challenge. Not every lender will even offer FHA loans, let alone deal with a poor credit score.
If you do find a lender willing to work with your score, be prepared to pay much higher fees than you’d generally be charged with a better score. On the plus side, making your mortgage payments on time each month can help build a positive payment history and potentially increase your credit score.
Even With Poor Credit, You Still Have Options
Unless you have the income to simply pay cash for everything, having a low credit score can make your entire financial life a struggle. But it’s not impossible to find credit with a 400 to 450 credit score.
And, what’s more, while a 400 to 450 credit score can take time to improve, it can be improved. Creating a sustainable budget so you can pay down debt and build a positive payment history can go a long way toward improving your credit score over time.
Range of credit scores covered in this article: 400, 401, 402, 403,404, 405, 406, 407, 408, 409, 410, 411, 412, 413, 414, 415, 416, 417, 418, 419, 420, 421, 422, 423, 424, 425, 426, 427, 428, 429, 430, 431, 432, 433, 434, 435, 436, 437, 438, 439, 440, 441, 442, 443, 444, 445, 446, 447, 448, 449, 450