2016's Best Unsecured Credit Cards

Below are our staff picks for 2016's best unsecured credit cards for bad credit. These cards typically grant cardholders a credit line without requiring a security deposit or pre-payment:

Average APR
17.19%
Average Annual Fee
$9.50
Rate Trend
0.11%
since last month

Review Summary

Finding the right unsecured credit card, whether it's for rebuilding bad credit or gaining flexibility with a new credit line, can be daunting. With so many factors to consider, it's easy to make an uninformed choice. The table below, however, makes this much easier. Simply compare cards and click on your card of choice to go to its online application.

Here are 2016's best unsecured credit cards:

Unsecured Credit Cards Bad Credit
Rank Card Name Designed For Annual Fee Expert Rating
1 Surge MasterCard® Bad, Poor Credit $125 for the first year ★★★★ 4.2
2 Emporium Card Poor, Fair, Limited, or Damaged Credit N/A ★★★★ 4.1
3 Total Visa® Card Fair, Bad Credit See Terms* ★★★★ 4.1
4 Credit One Bank® Unsecured Visa® Credit Card Poor Credit $0 - $99 ★★★★ 4.0
5 Milestone® MasterCard® – Bad Credit Considered Bad, Poor Credit $35 - $99* ★★★★ 4.0
6 Credit One Bank® Visa® – No Deposit Required Fair Credit $0 - $99 ★★★★ 3.8
7 Indigo® MasterCard® for Less than Perfect Credit Bad, Poor Credit $0 - $99 ★★★★ 3.8
8 Milestone® MasterCard® with Free Choice of Card Image Fair / Good Credit $35 - $99* ★★★ 2.7
9 Next Millennium No Credit Check N/A ★★ 2.0

More About: Unsecured Credit Cards

How an Unsecured Credit Card Works

Mike Randall
Finance Expert
How an Unsecured Credit Card Works
CardRates.com Guide: Unsecured Cards

Unsecured credit cards are the most common form of credit issued in the U.S. and around the world. An unsecured credit card is a form of preapproved loan that allows a user to make purchases and pay for services without being required to get separate approvals each time.

If the credit card holder shows a willingness and ability to pay back the amount they charge, the credit card issuer keeps the credit line active. As long as they make regular payments and don’t exceed their credit limits, the holder can continue to use the card.

This type of revolving credit line is called an unsecured credit card, and it’s what most people use.

1.
The credit card issues pays the merchant

What’s the difference between a secured and an unsecured credit card? If you think about it, an unsecured credit card is really a lender trusting us with their money. The lender (or credit card issuer) is making the payment to the merchant or vendor that accepts our card. In return, we pay our credit card bill when it’s due and a little extra in interest. That’s it in a nutshell.

But what if we can’t get a bank to give us a credit card? If we don’t have a good credit history, or if we’ve had problems making our credit card payments in the past, it’s unlikely a bank will give us an unsecured credit card.

The alternative is to get a secured credit card. The premise is simple — if we put a deposit into an account held by the card issuer, they’ll give us a secured credit card for the amount we put down (or close to it) and issue us a secured card. It’s no risk to them, and it gets us a card we can use in place of cash. Many people do this until they can rebuild their credit.

2.
There's no upfront deposit

In contrast to a secured credit card, an unsecured card doesn’t require us to put a deposit down before we get the card. It also gives us a credit line that can be thousands of dollars and can be repaid up to 30 days in the future. This is the advantage of having good credit history and establishing a good credit score.

And that’s all there is to know about unsecured credit cards. If you think an unsecured credit card sounds right for you, give it a go!

Photo source: englinea.com

Editorial Note: Opinions expressed here are author's alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Mike Randall

* Advertiser Disclosure: The credit card offers that appear on this site are from credit card companies from which CardRates.com receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). CardRates.com does not include all credit card companies or all available credit card offers. See the credit card issuer's website for specific terms and conditions of each card.