Credit Cards to Rebuild your Credit in Canada

Best Credit Cards to Rebuild Your Credit in Canada

Your credit score is an essential component in establishing both the state of your finances and your eligibility for a variety of financial services and products. When you have a strong credit score in Canada, as well as in many other nations, you have better access to better interest rates, approvals for loans, and bigger credit limits. Nevertheless, there is always the possibility that something will happen to lower your credit score, making it more difficult for you to have access to credit facilities. 

Rebuilding your credit is feasible for anyone, regardless of whether you are just starting out with credit or have gone through some difficult financial times in the past. Making responsible use of credit cards that are tailored to meet the requirements of credit-rebuilding can be an efficient strategy.

In this blog, we’ll take a look at some of the top credit cards that are currently on the market in Canada to assist you in reestablishing your credit history.

Credit Cards That Require a Security Deposit

People who have a limited credit history or a terrible credit history frequently choose to apply for secured credit cards. These credit cards require you to make a security deposit, which acts as collateral for your available credit. 

In most cases, the amount of the deposit is either the same or somewhat higher than the credit limit that is issued. When you use your secured credit card in a responsible manner and make your payments on time, you begin to build a positive credit history, which has the potential to help your credit score increase over time.

Top Pick: Home Trust Secured Visa

People who are trying to improve their credit may benefit greatly from applying for a Home Trust Secured Visa. It provides you with an interest rate that is comparable to other products on the market, a credit limit that is equal to or more than the amount of your security deposit, and consistent reporting to the three major credit agencies. 

You can establish a positive credit history with prudent usage, which will eventually allow you to qualify for an unsecured credit card.

Low-Interest Credit Cards

High-interest rates can be a significant source of stress for persons who have credit ratings that are less than ideal. Credit cards with low-interest rates are specifically designed to provide customers with competitive interest rates, which makes it much simpler to keep track of balances and prevents customers from racking up excessive interest fees. 

Although these credit cards typically come with fewer rewards and features, their primary purpose is to assist you in rebuilding your credit in a responsible manner.

Top Pick: MBNA True Line® Gold Mastercard®

Because it has a low annual fee and a low introductory interest rate on balance transfers, the MBNA True Line® Gold Mastercard® is an appealing choice for consumers who are interested in re-establishing or improving their credit. 

This card gives cardholders the opportunity to consolidate debt from other cards with higher interest rates and pay off that debt at a pace that is more manageable financially.

Student Credit Cards

Students who are just beginning their careers with credit can benefit from credit cards that are specifically designed for their circumstances. These credit cards typically have approval requirements that are more lax, which enables individuals with a low credit history or no credit score at all to qualify for one of these cards.

Students can get a head start on building a solid credit history by using their student credit cards in a responsible manner.

Top Pick: BMO SPC CashBack Mastercard

Students who are trying to establish or improve their credit history should seriously consider applying for the BMO SPC CashBack Mastercard. It does not charge an annual fee and provides cash rewards for purchases made with the card. 

10 Best Credit Cards that Use Transunion in Canada

On top of that, it grants access to a program called the Student Price Card (SPC), which entitles the holder to special discounts at a variety of merchants.

 Credit Cards with Credit Monitoring

If repairing your credit is a priority of yours, having access to credit monitoring services can be of tremendous assistance to you in this endeavor. These credit cards frequently provide free monitoring of your credit score, which enables you to keep a close eye on your development as you work towards better credit. 

Monitoring your credit score on a consistent basis enables you to identify areas in which you might use improvement and to adapt your spending and saving behaviors accordingly.

Top Pick: Refresh Financial Secured Visa

The credit monitoring services that come with the Refresh Financial Secured Visa set it apart from other credit cards. Cardholders get free access to their credit score as well as any adjustments that may have been made to their credit report, which assists them in monitoring their progress as they attempt to rebuild their credit.

On top of that, there is a minimal yearly cost associated with the card, and approval for it requires a security deposit.

Credit Cards Sold at Retail Stores or by Retailers

Rebuilding credit with retailer or shop credit cards is an additional option, particularly for people who have a short credit history or no credit history at all. Popular merchants are your best bet for acquiring one of these cards, as they are typically easier to obtain than standard credit cards. When combined with on-time payments, responsible usage of these credit cards can contribute to the development of a solid credit history.

Top Pick: Canadian Tire Options® Mastercard®

Rebuilding credit is a great opportunity to use a shop credit card, and one of the best options available is the Canadian Tyre Options® Mastercard®. It gives you more options to earn and redeem points at Canadian Tyre locations as well as other partner retailers. If you make responsible purchases with this card, you’ll be able to raise your credit score over time.

Credit Cards With No Annual Fees

It is essential for people who are working to improve their credit to steer clear of unneeded costs. The burden of annual fees is lifted off cardholders’ shoulders by no-fee credit cards, which also enable cardholders to focus on managing their credit responsibly without paying any additional expenditures.

Top Pick: Tangerine Money-Back Credit Card

Because there are no annual fees associated with the Tangerine Money-Back Credit Card, it is an appealing option for people who are working to rehabilitate their credit. It allows cardholders to choose certain spending areas for which they will receive higher cashback rates, and it offers cashback incentives on transactions that are made on a daily basis.

Summary 

Rebuilding your credit in Canada may seem like a difficult task at first, but if you use the appropriate credit card, the process may become manageable and even gratifying. Your efforts will produce fruit over the course of time, and you’ll be well on your way to a stronger credit score and improved financial chances as a result. To get started on the road to better credit in the future, select a credit card that meets your requirements and contributes to the achievement of your financial objectives.