Close Menu
    Subscribe

    Why Getting a Subprime ‘Tax’ Refund Could Hand You $3,000—Even If Your Credit Score Is Stuck

    Why Getting a Subprime ‘Tax’ Refund Could Hand You $3,000—Even If Your Credit Score Is Stuck

    Ever feel like you’re paying hundreds—sometimes thousands—more just because your credit score isn’t perfect? You’re not alone. Bankrate found that low-credit borrowers get hit with a hidden “subprime tax,” costing them an extra $3,400 a year in higher loan rates and insurance. But you can claw a lot of that back, fast. Here are four rapid resets anyone can use—even if your score won’t budge yet.

    1. Switch Your Auto or Home Insurance—Save Real Cash Fast

    If your credit score is under 670, you could be overpaying for insurance by hundreds per year. Most drivers and homeowners don’t shop around…but the math says you should.

    92% of insured Americans saved money after switching insurers, and 22% saved at least $200 each year (LendingTree).

    Bold takeaway: A quick switch could put $200+ right back in your wallet starting today.

    • Get quotes from three new insurance companies. Don’t just renew automatically!
    • Check for extra discounts (bundling, good driver, pay-in-full).
    • If you find a better deal, switch—no need to wait for renewal dates.

    Ready for a refund? Compare new policies right after you finish reading—$100+ per year is a win for most households.

    2. Get a Secured Credit Card with $0 Annual Fee (and Perks)

    Can’t get approved for regular credit cards? Secured cards are built for you. They help you build a credit history with just a small refundable deposit—and many charge no annual fee at all.

    The Discover it® Secured Card has no annual fee and earns 2% cash back at gas stations and restaurants, plus 1% everywhere else (WalletHub).

    Bold takeaway: You don’t need a perfect score or lots of cash—just $49 to $200 is enough for approval with many top cards.

    • Apply for cards with no annual fee: like Discover it® Secured, Capital One Platinum Secured, or Chime Credit Builder.
    • Look for perks: cash back and automatic reviews for unsecured upgrades.
    • Pay on time and keep balances low—your score starts climbing, and you qualify for better deals within months.

    Start with one card today—most don’t even check your credit, so no risk of a denial.

    3. Use Cards That Don’t Require a Credit Check at All

    If you’re worried about applications hurting your score, choose cards that skip the credit check. These cards still report to all three major credit bureaus, so you can build or repair credit safely.

    The OpenSky® Plus Secured Visa® and GO2bank Secured Visa® Credit Cards both require no credit check and no annual fee (Forbes Advisor).

    Bold takeaway: You don’t need hard inquiries or rejections to rebuild credit—some cards are invite-free and designed for low-scorers.

    • Find options like Chime Credit Builder or OpenSky® Plus, where there’s NO credit check.
    • No annual fee means all your money stays with you.
    • Your on-time payments get reported, boosting your credit with zero risk.

    Check your eligibility online—it takes 5 minutes and there’s no credit hit for applying.

    4. Pick a Secured Card with Perks and Prepare to Graduate

    The best secured cards give you more than just a fresh start—they offer real rewards, protection, and may even upgrade you to an unsecured card quickly.

    The Navy Federal nRewards® Secured Card offers reward points, charges no annual fee, and reviews you for an upgrade after 6 months (LendingTree).

    Bold takeaway: A powerful, no-fee secured card can set you up for bigger savings in less than a year.

    • Look for cards that promise regular upgrades (like Navy Federal, Space Coast, or Bank of America® Customized).
    • Use the card monthly, pay in full, and watch your limits increase and fees fall away.
    • When you graduate to unsecured, your “subprime tax” drops for good.

    Apply now and use just $10–$50 monthly—consistency is what makes you eligible to upgrade faster.

    Conclusion: Start Your Subprime Tax Refund Today

    The “subprime tax” doesn’t have to own your budget any longer. Switch your insurance, grab a secured card, and you could save up to $3,000 this year, with benefits that grow over time. Choose one reset today and start putting cash back where it belongs—in your pocket.

    Share.