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Best Credit Card for Rebuilding Credit in Canada for 2020

Nov. 5, 20
4 mins
A couple sits at home on their laptop in bright sunny apartment

Your credit score can help you get approved for top tier money products like mortgages, personal loans and rewards credit cards. Not only that, but it can also help you get the best interest rates, ultimately saving you money.

Lenders use your credit score to determine your creditworthiness and risk level when deciding whether to lend you money. Paying your bills on time and applying for credit only when you need it can positively impact your rating. Mismanaging credit by missing payments or maxing out your credit cards can have adverse effects on your score. Those with less than ideal credit scores may find it challenging to get approved for credit.

However, life gets in the way sometimes. The most important thing is to start to take the right steps to improve your circumstances when you can and slowly repair your credit score.

If you are unable to apply for a standard credit card, a secure credit card may be your best bet. Secured credit cards are designed to help people build or rebuild their credit. A deposit, typically $200 or more, is secured on the credit card and is generally the only requirement for approval. The cardholder pays their statements each month just like a regular credit card, and their payment history is reported to the two main credit bureaus, Equifax and TransUnion.

Over time, cardholders who pay their balances in full each month and use the card responsibly will see an improvement in their credit score and should be able to get the initial deposit back. You may qualify for an unsecured credit card that offers a low-interest rate or rewards when your credit score is fair or good.

We compared low-interest credit cards and secured credit cards intended to help people build or rebuild their credit rating. Using our Best of Finance methodology, we ranked the cards that provided the best value.

These are the best credit cards for rebuilding credit for 2020.

Our top pick
Credit card Great features Annual fee
1. Home Trust Secured Visa* 
  • Rebuild credit
  • Low-interest rate of 14.90%

$59 (or $5 per month)

Runners-up
Credit card Great features Annual fee
2. No Fee Scotiabank Value® VISA* Card
  • Build credit
  • Low-interest rate of 16.99%
$0
3. Refresh Financial Secured Visa
  • Rebuild credit
  • Low-interest rate of 17.99%
$12.95 (plus a $3 per month maintenance fee)

1. Home Trust Secured Visa*

The Home Trust Secured Visa* card has a low-interest rate of 14.90% on purchases. Cardholders can set their own limit with the amount of their secured deposit and build their credit rating. This card allows users to buy online, pay bills and shop anywhere Visa is accepted.

Credit score requirement for approval:

No credit: You currently do not have a credit card or loan in your name. You need to improve your credit due to a recent bankruptcy or default on a loan.

Annual fee:

$59

Or, pay monthly: $5

Credit limit (deposit):

$500 to $10,000

Insurance:

  • Purchase security
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2. No Fee Scotiabank Value® VISA* Card

The No Fee Scotiabank Value® Visa* Card is offering new cardholders a 3.99% promotional interest rate on balance transfers for the first six months. This card regularly has an interest rate of 16.99% on purchases, cash advances and balance transfers. By transferring your balance from a higher interest rate card, you’ll make paying off your balance more manageable and save on interest charges.

Credit score requirement for approval:

Good: You’ve had a credit card or loan for at least six years. You’ve had good credit for the last seven years (no bankruptcies or defaults on credit as a result of failing to pay debts back to creditors). You haven’t opened a new credit card account, loan, or line of credit in the last nine months. You’ve made the minimum payments on any existing credit cards for the past three months.

Annual fee:

$0

Limited time offer/bonus:

  • Get a 3.99% introductory interest rate on balance transfers for the first six months.

Offer expiry date: February 28, 2021

Other perks:

  • Save on rental cars at participating AVIS locations across the U.S. and Canada.

3. Refresh Financial Secured Visa

The Refresh Financial Secured Card offers cardholders the opportunity to rebuild their credit rating. This credit card charges an interest rate of 17.99%. Cardholders can choose a credit limit between $200 and $10,000, an amount that needs to be deposited on the account. It has an annual fee of $12.95 and a $3 monthly maintenance fee.

Plus, cardmembers can access Refresh f.i.t, a series of education videos for simple steps for improving credit and setting financial goals.

Credit score requirement for approval:

No credit: You currently do not have a credit card or loan in your name. You need to improve your credit due to a recent bankruptcy or default on a loan.

Annual fee:

$12.95

Plus, a maintenance fee: $3 per month

Credit limit (deposit):

$200 to $10,000

Rates, product information, and rewards estimates are subject to change at any time and do not constitute financial advice. Information in this article is accurate as of the date of this posting, November 5, 2020. This article was first published on August 19, 2020.

This post has been updated.

Best of Finance 2020 Methodology Infographic

Hayley Vesh

Hayley Vesh is a creative, resourceful, and knowledgeable content producer who is passionate about financial literacy, storytelling, and generating ideas. She writes about credit cards, savings, debt management, and personal finance. In her spare time, Hayley can be found wandering in the woods, hunting for second-hand treasures, or curled up with a steeped tea and a good podcast.

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