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Credit One Bank Secured Card
Credit One Bank Secured Card
- 28.99% variable based on the Prime Rate Regular Purchase APR
- 28.99% variable based on the Prime Rate Cash Advance APR
At a Glance
The Credit One Bank Secured Card is a no annual fee secured credit card from Credit One Bank. The card offers up to 1% cash back on eligible purchases, a $200 minimum security deposit that earns interest, and more.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- No annual fee
- Earn interest on your minimum $200 security deposit
- Earn 1% cash back rewards on gas and groceries as well as your monthly mobile phone, internet, cable, and satellite TV services
- Automatically earn More Cash Back Rewards for using your Credit One Bank card at participating merchants, terms apply
- With $0 Fraud Liability, you won’t be responsible for unauthorized charges
- View your free online access to your Experian credit score, terms apply
- Regular Purchase APR: 28.99% variable based on the Prime Rate
- Cash Advance APR: 28.99% variable based on the Prime Rate
- Cash Advance Transaction Fee: Either $5 or 8% of the amount of each Cash Advance, whichever is greater
- Foreign Transaction Fee: Either $1 or 3% of each purchase in U.S. dollars, whichever is greater
- Late Payment Penalty Fee: Up to $39 (terms apply)
- Return Payment Penalty Fee: Up to $39 (terms apply)
- Minimum Deposit Required: $200
- You're seeking to establish – or rebuild – your credit
- You want a security deposit that earns interest
- You want basic cash rewards
- You do't want to pay an annual fee
Unity Visa Secured Credit Card
Unity Visa Secured Credit Card
- 17.99% fixed rate through the expiration date of the card. Regular Purchase APR
- 17.99% fixed rate through the expiration date of the card. Balance Transfer APR
- 17.99% fixed rate through the expiration date of the card. Cash Advance APR
At a Glance
The Unity Visa Secured Card by OneUnited Bank is a secured credit card that is looking to make a difference. Issued by OneUnited, the largest black-owned bank in the United States, the card seeks to help holders “make a comeback” with sound financial use (and without the need for debit cards or prepaid cards). The card features a fixed-rate APR on purchases, balance transfers, and cash advances, plus a special introductory rate on balance transfers for the first six months – all for a $39 annual fee.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- Get a second chance at credit
- Support the natio's largest back-owned bank
- 9.95% intro APR on balance transfers for the first 6 months
- Regular Purchase APR: 17.99% fixed rate through the expiration date of the card.
- Intro Balance Transfer APR: 9.95% for 6 months from account opening date
- Balance Transfer APR: 17.99% fixed rate through the expiration date of the card.
- Balance Transfer Transaction Fee: Either $10 or 3% of the amount of each transfer, whichever is greater
- Cash Advance APR: 17.99% fixed rate through the expiration date of the card.
- Cash Advance Transaction Fee: Either $10 or 3% of the amount of each transfer, whichever is greater
- Annual Fee: $39
- Foreign Transaction Fee: 3% of each transaction in U.S. dollars
- Late Payment Penalty Fee: Up to $10
- Return Payment Penalty Fee: Up to $37
- Minimum Deposit Required: $250
- You're looking to rebuild your credit with the major credit bureaus
- You want to empower your community by contributing to OneUnited’s education projects
- You plan to pay your entire statement balance each month
Fifth Third Secured Card
Fifth Third Secured Card
- 29.24% variable based on the Prime Rate Regular Purchase APR
- 23.24% variable based on the Prime Rate Balance Transfer APR
- 29.99% variable based on the Prime Rate Cash Advance APR
At a Glance
The Fifth Third Secured Card is a sound secured credit card and a helpful tool that can help you either build or repair your credit history with responsible use.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- Start with as little as a $300 deposit into a Fifth Third Savings Account that earns interest
- Your credit limit will be tied to your deposit amount
- Build your credit history—important account information is shared with the three major credit bureaus
- Build, or rebuild, your credit history with each purchase
- Regular Purchase APR: 29.24% variable based on the Prime Rate
- Balance Transfer APR: 23.24% variable based on the Prime Rate
- Balance Transfer Transaction Fee: Either $5 or 4% of the amount of each balance transfer, whichever is greater
- Cash Advance APR: 29.99% variable based on the Prime Rate
- Cash Advance Transaction Fee: Either $10 or 5% of the amount of each cash advance, whichever is greater
- Annual Fee: $24
- Foreign Transaction Fee: 3% of the transaction amount in U.S. dollars
- Late Payment Penalty Fee: Up to $40
- Minimum Deposit Required: $300
- You have little or no credit history, including a low credit score
- You have a credit history in need of repair
- You want a credit card that will keep you organized with your spending
- You're looking for a credit card that will report your commendable behavior to credit reporting bureaus
- You want the same convenience and benefits you’d get from a traditional unsecured credit card
Golden 1 Member First Visa® Card
Golden 1 Member First Visa® Card
- 15.04% variable based on the Prime Rate Regular Purchase APR
- 15.04% variable based on the Prime Rate Balance Transfer APR
- 15.04% variable based on the Prime Rate Cash Advance APR
At a Glance
The Golden 1 Member First Visa® Card is a no-frills secured credit card offer from Golden 1 Credit Union. With no annual fee, no balance transfer fee, and a low APR for purchases, the secured card is ideal for anyone who wants to establish, build, or repair their credit.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- No annual fee
- Funds used for deposit will earn dividends
- Credit limit: $250 to $3,000
- Low APR
- Regular Purchase APR: 15.04% variable based on the Prime Rate
- Balance Transfer APR: 15.04% variable based on the Prime Rate
- Cash Advance APR: 15.04% variable based on the Prime Rate
- Cash Advance Transaction Fee: Either $5 or 2.5% of the amount of each cash advance, whichever is greater
- Foreign Transaction Fee: Up to 1% of the transaction amount in U.S. dollars
- Late Payment Penalty Fee: Up to $15
- Return Payment Penalty Fee: Up to $25
- Minimum Deposit Required: $250
- You need to build (or repair) your credit history
- You don’t want to pay an annual fee or balance transfer fee
- You want to earn dividends from your security deposit
- You will take advantage of a low purchase APR
- You are a member of the Golden 1 Credit Unio
Truist Enjoy Cash Secured Credit Card
Truist Enjoy Cash Secured Credit Card
- 24.24% variable based on creditworthiness and the Prime Rate Regular Purchase APR
- 24.24% variable based on creditworthiness and the Prime Rate Balance Transfer APR
- 27.24% variable based on the Prime Rate Cash Advance APR
At a Glance
The Enjoy Cash Secured Visa® Credit Card is a secured cash back credit card from Truist. The card offers elevated cash rewards on gas, groceries, and utilities, plus the chance to build a positive credit history for a modest $19 annual fee.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- Earn up to 3% cash back on gas, 2% on utilities and groceries (with a combined $1,000 monthly cap), and 1% back on all other eligible purchases
- Unlimited cash back rewards
- Monthly payment history will be reported to three major credit bureaus
- Up to 50% Loyalty Cash Bonus based on your Truist deposit relationship when cash rewards are redeemed into a Truist deposit account
- Low annual fee
- Regular Purchase APR: 24.24% variable based on creditworthiness and the Prime Rate
- Balance Transfer APR: 24.24% variable based on creditworthiness and the Prime Rate
- Balance Transfer Transaction Fee: Either $10 or 3% of the amount of each transfer, whichever is greater
- Cash Advance APR: 27.24% variable based on the Prime Rate
- Cash Advance Transaction Fee: Either $10 or 4% of the amount of each cash advance, whichever is greater
- Annual Fee: $19
- Late Payment Penalty Fee: Up to $40
- Minimum Deposit Required: See Terms
- You already bank with Truist
- You can afford the $400 minimum deposit requirement
- You want versatile cash back rewards
First Latitude Select Mastercard® Secured Credit Card
First Latitude Select Mastercard® Secured Credit Card
- 19.24% (Variable) Regular Purchase APR
- 25.24% (Variable) Cash Advance APR
At a Glance
The First Latitude Select Mastercard Secured Credit Card can help you build a positive credit history with financial responsibility and regular payments, all for a $39 annual fee.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- Earn 1% Cash Back Rewards on payments made to your First Latitude Secured credit card account. • Past credit issues shouldn’t prevent you from getting a credit card with great benefits & rewards! • Choose your own fully-refundable credit line - $200 to $2000 – based on your security deposit. • Build or rebuild your credit!¹ • Accepted wherever Mastercard® is accepted • Reports to all 3 credit bureaus • No minimum credit score required for approval! • ¹Cardholders who keep their balance low and pay their credit card bill on time every month typically do see an increase in their credit score. • *See Important Disclosures for complete offer details
- Regular Purchase APR: 19.24% (Variable)
- Cash Advance APR: 25.24% (Variable)
- Cash Advance Transaction Fee: Either $10 or 3% of the amount of each cash advance, whichever is greater
- Annual Fee: $39
- Foreign Transaction Fee: 3% of the transaction amount in U.S. dollars
- Late Payment Penalty Fee: Up to $41
- Return Payment Penalty Fee: Up to $30
- Minimum Deposit Required: Minimum refundable deposit of $200.00 up to $2,000.00*
- You have little-to-no credit history and struggle to get approved for other credit cards
- You want to establish a credit history or improve your credit score
- You can submit a minimum of $100 for the security deposit
- You don’t intend to carry a balance from month-to-month
USAA Secured American Express® Credit Card
USAA Secured American Express® Credit Card
- 27.9% variable based on the Prime Rate Regular Purchase APR
- 27.9% variable based on the Prime Rate Balance Transfer APR
- 27.9% variable based on the Prime Rate Cash Advance APR
At a Glance
The USAA Secured American Express® Credit Card can help you establish a positive credit history with regular payments and responsible use. The card benefits from no fees for foreign transactions and no annual fee for membership.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- No annual fee
- No foreign transaction fees
- Build credit with on time payments and responsible use
- Regular Purchase APR: 27.9% variable based on the Prime Rate
- Balance Transfer APR: 27.9% variable based on the Prime Rate
- Balance Transfer Transaction Fee: 3% of the amount of each Balance Transfer.
- Cash Advance APR: 27.9% variable based on the Prime Rate
- Cash Advance Transaction Fee: 3% of the amount of each Cash Advance. Fee waived when transferring funds electronically to a USAA deposit account.
- Late Payment Penalty Fee: Up to $35
- Return Payment Penalty Fee: Up to $35
- Minimum Deposit Required: $250
- You qualify for USAA membership
- Your credit history is damaged or non-existent
- You do't want to pay an annual fee
First Progress Platinum Prestige Mastercard® Secured Credit Card
First Progress Platinum Prestige Mastercard® Secured Credit Card
- 15.24% variable based on the Prime Rate Regular Purchase APR
- 24.24% variable based on the Prime Rate Cash Advance APR
At a Glance
The Platinum Prestige Mastercard Secured Credit Card offers an excellent rate, robust Mastercard security, and the ability to rebuild or establish credit – all in one package.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- 1% Cash Back Rewards on payments
- Choose your own credit line - $200 to $2000 – based on your security deposit
- Build your credit score.¹ Reports to all 3 credit bureaus
- No minimum credit score required for approval!
- ¹ Cardholders who keep their balance low and pay their credit card bill on time every month typically do see an increase in their credit score.
- Regular Purchase APR: 15.24% variable based on the Prime Rate
- Cash Advance APR: 24.24% variable based on the Prime Rate
- Cash Advance Transaction Fee: Either $10 or 3% of the amount of each cash advance, whichever is greater
- Annual Fee: $49
- Foreign Transaction Fee: 3% of the transaction amount
- Late Payment Penalty Fee: Up to $41
- Return Payment Penalty Fee: Up to $30
- Minimum Deposit Required: $200
- You're looking to rebuild a damaged credit score
- You plan to carry a balance
- You prefer the versatility of a credit card vs. a debit card or prepaid cards
- You want the freedom to use your card virtually anywhere worldwide
TD Cash Secured Credit Card
TD Cash Secured Credit Card
- 27.99% variable based on the Prime Rate Regular Purchase APR
- 27.99% variable based on the Prime Rate Balance Transfer APR
- 30.24% variable based on the Prime Rate Cash Advance APR
At a Glance
If you don’t have an impressive credit score, the TD Cash Secured Credit Card can help you get back on track while you earn 3% cash back on dining, 2% at grocery stores, and 1% on other eligible purchases wherever life takes you.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- Build or repair your credit and earn cash back on everyday purchases
- Chance at an unsecured card in as little as 7 months
- Earn 1% Cash Back on all eligible purchases
- Regular Purchase APR: 27.99% variable based on the Prime Rate
- Balance Transfer APR: 27.99% variable based on the Prime Rate
- Balance Transfer Transaction Fee: Either $5 or 3% of the amount of each transfer, whichever is greater
- Cash Advance APR: 30.24% variable based on the Prime Rate
- Cash Advance Transaction Fee: Either $10 or 5% of the amount of each cash advance, whichever is greater
- Annual Fee: $29
- Foreign Transaction Fee: 3% of each transaction in U.S. dollars
- Late Payment Penalty Fee: Up to $40
- Return Payment Penalty Fee: Up to $40
- Minimum Deposit Required: $300
- You have poor credit and want to rebuild your credit score
- You wish to earn 3% on dining, 2% at supermarkets, and 1% on other qualifying purchases you make
- You eventually want to qualify for an unsecured credit card with an array of benefits and features
Commerce Bank Secured Visa® Card
Commerce Bank Secured Visa® Card
- 23.49% variable based on the Prime Rate Regular Purchase APR
- 23.49% variable based on the Prime Rate Balance Transfer APR
- 30.49% variable based on the Prime Rate Cash Advance APR
At a Glance
The Commerce Bank Secured Visa® Card is a basic secured credit card from Commerce Bank. The card helps holders improve their credit score with smart use and regular payments, hopefully leading to a future upgrade to an unsecured rewards credit card. Commerce Bank reports to the three major credit bureaus and offers complimentary access to the account holder’s FICO® score each month. The card requires a minimum deposit of $400 and features an annual fee of $49 and no hidden fees.
- Best Benefits
- Rates & Fees
- Why Should You Apply?
- Help establish, strengthen or rebuild credit
- Enjoy regular access to your FICO score
- Worldwide acceptance
- Earn interst in your security deposit
- Regular Purchase APR: 23.49% variable based on the Prime Rate
- Balance Transfer APR: 23.49% variable based on the Prime Rate
- Cash Advance APR: 30.49% variable based on the Prime Rate
- Annual Fee: $49
- Foreign Transaction Fee: 1% of each transaction in U.S. dollars; 2% of each transaction made in currencies otherthan U.S. dollars
- Late Payment Penalty Fee: Up to $15
- Return Payment Penalty Fee: $25
- Minimum Deposit Required: $400
- You're looking to rebuild your credit
- You want monthly access to your FICO® score
- You want to earn interest on your security deposit
You've viewed 5 of 78 credit cards
How Do Secured Credit Cards Work?
Secured credit cards are a great option for individuals with no credit history or those trying to rebuild their credit after experiencing financial difficulties. That’s because they require an extra step in the application process. Despite that, secured credit cards function similarly to regular credit cards, with one key difference – the need for a security deposit.
When you apply for a secured credit card, you must provide a cash deposit that serves as collateral for your credit limit. This deposit reduces the risk for the card issuer, as they can use it to cover any unpaid balances in case you default on your credit card payments.
The amount of your security deposit typically determines your credit limit. For example, if you deposit $500, your credit limit will also be $500. It’s important to note that the deposit is refundable as long as you maintain a good payment history and eventually close the account.
Benefits of Secured Cards
When it comes to building or rebuilding credit, secured credit cards offer several advantages that make them a popular options:
- Establish a positive credit history: Making regular, on-time payments and maintaining low credit utilization with a secured credit card can help you build a strong credit profile. This is crucial for obtaining future credit cards, loans, and mortgages and ensuring you get the lowest rate possible.
- Access to credit card benefits and perks: Secured cards let you enjoy the conveniences and perks of traditional credit cards. They can be used for online purchases, car rentals, and hotel bookings. Some secured credit cards even feature rewards programs, allowing you to earn points or cash back on eligible purchases.
- Develop healthy financial habits: Since a cash deposit is required to secure the credit limit, individuals are more likely to spend responsibly and avoid accumulating excessive debt. This valuable lesson in financial discipline and budgeting can contribute to your long-term financial well-being.
Chance to Upgrade
Perhaps the best benefit of secured credit cards is the opportunity to upgrade to unsecured credit after boosting your credit and demonstrating positive credit behaviors.
Some secured credit cards offer automatic upgrades. For example, Discover may upgrade the Discover it Secured Card to a Discover it Chrome Card in as little as six months. However, not every credit card issuer offers a path to upgrading, so it’s important to consider your future credit plans before applying.
Key Features to Consider When Choosing a Secured Card
When choosing a secured credit card, it’s essential to consider several key features to ensure it aligns with your financial needs and goals. Here are the key features to look for:
Eligibility Requirements
- Always ensure you meet the eligibility requirements before applying for a secured credit card.
- Some banks have credit score requirements, while others may have strict rules regarding customer status.
- International students should pay attention to banks’ acceptance policies, as some may require a Valid Social Security Number (SSN) while others accept an Individual Taxpayer Identification Number (ITIN).
Affordable Security Deposit
- The security deposit for secured credit cards acts as collateral for the credit line.
- Many secured credit cards require a deposit of around $200 to $300, while some credit unions may require a lower deposit.
- Consider a card with a low deposit requirement if affordability is a concern.
Manageable Fees
- Most secured cards come with various fees, including annual, late, and APR fees.
- Aim for a secured card with an annual fee of $50 or less, and be mindful of the additional fees for essential services.
Grace Period
- Look for a secured card that offers a grace period between the statement date and the due date to avoid accruing interest on purchases.
Credit Bureau Reporting
- Ensure that the secured card reports to the major credit bureaus (Experian, Equifax, and TransUnion) to build and improve your credit score.
Chance to Upgrade
- Some secured cards offer paths to upgrading to unsecured cards after a certain period, which is beneficial for future credit plans.
Considerations When Choosing a Secured Card
- Automatic upgrades: Some secured cards offer automatic upgrades to unsecured cards after a certain period, providing a path to improving credit standing.
- Building credit: Secured cards are primarily for building credit, so ensure the card reports to major credit bureaus for effective credit building.
- Rewards: While some secured cards offer rewards, the value of these rewards may be minimal compared to the focus on building credit and obtaining a lower APR.
By considering these key features, you can make an informed decision about choosing a secured credit card that best suits your financial situation and goals.
Tips for Using Secured Credit Cards Responsibly
Using a secured credit card responsibly is crucial for building credit and maintaining a healthy financial profile. Here are some tips to help you make the most of your secured credit card:
- Pay your balance in full and on time: Make it a priority to pay your credit card balance in full each month. This not only helps you avoid interest charges but also demonstrates responsible credit behavior to lenders.
- Keep your credit utilization low: Aim to keep your credit utilization ratio below 30%. This means using only 30% or less of your available credit. High credit utilization can negatively impact your credit score, so keep your spending in check.
- Monitor your credit activity: Regularly review your credit card statements and credit reports to ensure all charges are accurate. Monitoring your credit activity lets you immediately detect errors or potentially fraudulent activity.
- Avoid cash advances: Cash advances on your secured credit card often have high fees and interest rates. These transactions should be avoided unless absolutely necessary.
- Upgrade to an unsecured credit card: Once you’ve established a positive credit history, inquire with your card issuer about upgrading to an unsecured credit card. This transition can provide you with increased credit limits and the return of your security deposit.
Secured Credit Card Myths
There is so much information online about secured credit cards. How do you weed out the myths? Financial products may change over time. Credit cards today differ from how they might have been 50 years ago. Along the way, secured credit cards may have picked up a few common myths. Let’s debunk them.
Myth: Applying for a new credit card won’t affect my credit score
Fact: Applying for new credit impacts your credit score, regardless of approval or usage.
Myth: Paying less than the monthly minimum due on a credit card won’t count as a missed payment
Fact: Any payment below the minimum amount could be reported as a missed payment, affecting your credit score.
Myth: Closing unused credit card accounts with zero balances boosts credit score
Fact: Keeping unused credit card accounts open can increase total available credit, positively impacting credit score.
Myth: Carrying a credit card balance helps build credit history
Fact: Paying off the balance in full each month is beneficial for credit history and may increase credit score.
Myth: Having many credit cards improves credit score
Fact: Credit bureaus prefer a variety of credit types, not just multiple credit cards.
Myth: All interest rates on credit card balances are the same
Fact: Different balances may have different interest rates, and payments above the minimum are applied to the highest interest rate.
Myth: High credit limits on credit cards are not beneficial
Fact: Managing high credit limits with low balances can lower debt-to-credit ratio, potentially boosting credit score.
Alternatives to Secured Cards
Not sure if a secured credit card is right for you? There are several alternative options to consider instead of secured cards, including the following:
Debit Cards
Debit cards are popular options for those who prefer convenience and want a safer alternative to carrying cash. Debit cards are payment cards linked to a checking or deposit account. With debit cards, you can only spend what you have in the bank. Because of this, debit cards typically don’t build credit.
That’s not to say that you can’t build credit with a debit card. Banks are increasingly issuing credit-builder debit cards that build credit with every transaction. These cards operate like charge cards in that whatever you purchase is immediately paid off using the account’s funds. When the credit-builder card pays itself back from your account, it reports those payments to the major credit bureaus.
Credit-Builder Loans
Credit-builder loans are designed to help you establish a good payment history. The money you “borrow” is not directly given to you. Instead, it is held in a savings account on your behalf while you repay the loan in monthly installments. Once you repay, the money is released, and your credit report reflects a paid-off loan.
Secured or Debit Card: Which Is Best for You?
Secured credit cards can be a valuable tool for improving your financial standing if you have poor or no credit. By using them responsibly, you can boost your credit score as they report your activity to the three major credit bureaus in the United States. On the other hand, prepaid cards do not report your activity, so they won’t have an impact on your credit score.
If you don’t currently have the necessary credit to qualify for an unsecured credit card, secured credit cards can be a good option. While unsecured cards may offer more attractive APR and benefits, their application process is often stricter, requiring evaluation of personal income, assets, and other factors. However, with time and responsible credit use, you can work towards qualifying for unsecured cards as well.
FAQs
Here are the most commonly asked questions about secured credit cards:
Many secured credit cards do not earn rewards. This is partially because secured cards are designed to help teach sound credit fundamentals and boost credit scores through on-time payments. The other major reason why most secured cards lack rewards is that most applicants place small initial deposits, so the credit limit isn’t sufficient for the kind of spending rewards cards require to be worthwhile.
That said, there are a handful of cards that require a security deposit and offer rewards. The most notable of these cards is the Discover It Secured. The card is like the Discover It chrome Card in that it earns 2% back on gas and dining.
It also comes with the same Discover Cashback Match after year one. The only difference with the secured version is that it requires a deposit of at least $200.
Two other secured cards with rewards are the SKYPASS Visa Secured Card and the LATAM Visa Secured Card. Both cards earn airline miles through purchases, with additional discounts on flights with Korean Air and LATAM, respectively.
As with other rewards credit cards, there are no limits to the total amount of points you can earn with a rewards secured credit card.
Getting more than one secured card might seem counterproductive, but it can quickly boost your credit score. More open credit accounts means the chance to add more on-time payments to your credit report. Multiple secured card accounts will also raise your available credit limit, allowing you to reduce your credit utilization rate. Those two factors comprise the majority of what makes up your FICO credit score.
Since these cards require a deposit that also acts as the credit limit, you can always increase your credit line with an additional deposit. Most issuers have rules about how credit limit increases occur. These may include applications, extra checks, or simply transferring more funds.
Banks and lenders usually require a minimum deposit of around $200 to open a secured account. Some credit unions need as little as $50, on the other hand. On the flip side, most secured cards have a maximum initial deposit of between $3,000 and $5,000.
Again, this amount differs based on the bank and type of secured card. Business secured cards, for instance, have much higher maximum despots – sometimes up to $35,000 or more.
The amount you deposit depends entirely on your unique situation. Those new to credit should start with a small deposit. Once they get the hang of paying the balance in full (and on time), they can increase their deposit as they wish.
Those with higher credit scores can use the flexible deposits on secured cards to quickly increase their available credit. This, in turn, can promptly decrease their credit utilization rate, leading to rapid increases in their credit score.
Like rewards, most credit cards that require a deposit do not earn interest on that deposit. Typically, deposits are held in a joint account by a card issuer. There the deposits sit until the cardholder either closes the account, or the bank claims the money due to non-payment.
Some credit union secured cards, however, do earn interest. While any interest cards accumulate will not be enough to retire on, it is still an excellent perk worth looking out for.
Yes. As with any other form of credit card, you can be denied a secured credit card. Despite the looser restrictions, card issuers wills till look at things like your employment, income, your payment history, and other relevant materials when you apply. If your credit history is full of late payments, you might struggle to get a secured card.
In those cases, unsecured cards like the Group One Platinum Card might make sense. These cards offer an unsecured line for credit for use in the Horizon outlet, which provides a wide selection of products, goods, gifts, and more. While not a Visa or Mastercard, they are still credit cards that report to the major credit bureaus. This can help you rebuild your credit with on-time payments.
No. While some secured credit cards from credit unions may offer a credit line increase after a history of on-time payments, there are no credit cards that offer a security deposit that can be paid over time.
There are no secured American Express credit cards. American Express and Chase are two of the largest card issuers that don’t offer secured credit cards.
- You must be 18 years or older to apply for a secured credit card
- Most credit card companies mail cards out with a timeframe of 7 to 10 business days before arrival. This is good rule to follow when expecting a new credit card in the mail, regardless of the issuer.
- The graduation period of a secured credit card differs from bank to bank. Some issuers, like Discover or Capital One provide graduation in a year or less, while others, like Merrick Bank, may increase your credit limit in as little as 7 months.
- Secured credit cards require a security deposit, typically between $200 to $5,000. Some card issuers offer deposits as low as $50, however, so shoip around if money is tight.
- There are no guaranteed credit cards, but a secured card is much easier to get than an unsecured credit card. This is because the security deposit doubles as the credit line, meaning you are more attractive to lenders.
- You can, yes, but it will only add a debit to your account balance and will not result in a negative credit utilization.
- You can’t pick up a secured credit card in Walmart, Target, or any other store. Secured credit cards require a credit application. For this reason, you can’t purchase a secured card like you would a prepaid or gift card.
- You pay off a secured card in the same way as any other credit card: online or via the bank’s mobile app, or, where applicable, in branch.
- Paying off a secured credit card will just refresh the credit line. You will not receive your security deposit back unless you close the card account and have a $0 balance.
- Yes, at least for a soft inquiry. Most secured cards require a hard pull, or a full pull of your credit report. Some, however, do not require a credit check, such as the OpenSky Visa.
- In some cases, yes. Check the terms and conditions of every credit card before you apply to fully understand what transactions are allowed.
- No. You cannot go over your credit limit with a secured card. Trying to purchase something over your credit limit will result in the sale being denied.
- Most likely no – even if you apply in branch.
- No. A secured credit card is a loan, so the security deposit cannot be garnished for child support or other judgements.
- A secured credit card is a form of loan, a secured loan. But yes, you can still receive a loan with a secured credit card. In fact, if you are new to credit as secured cards can help you establish a new type of credit, helping to boost your credit mix.
Conclusion
Secured credit cards are powerful tools for building credit safely and effectively. By using them responsibly, you can establish a positive credit history, learn financial discipline, and gradually transition to unsecured credit cards with more favorable terms. Remember to research and compare different secured credit card options, consider fees and interest rates, and follow responsible credit practices. With dedication and mindful credit management, secured credit cards can pave the way to a brighter financial future.
Editorial Disclosure – The opinions expressed on BestCards.com's reviews, articles, and all other content on or relating to the website are solely those of the content’s author(s). These opinions do not reflect those of any card issuer or financial institution, and editorial content on our site has not been reviewed or approved by these entities unless noted otherwise. Further, BestCards.com lists credit card offers that are frequently updated with information believed to be accurate to the best of our team's knowledge. However, please review the information provided directly by the credit card issuer or related financial institution for full details.